1. Introduction

During the first term of the European Commission in September 2023, President von der Leyen asked Mario Draghi, the former President of the European Central Bank, to prepare a report on the future of European competitiveness. The aim was to determine how the EU could respond swiftly to a changing world and ensure sustainable growth. Draghi produced the report on 9 September 2024. The so-called Draghi Report has had a significant influence on the policy decisions of the second European Commission. The simplification policy is one such initiative.

  When von der Leyen became a candidate for President of the European Commission, she published the political guidelines for the next European Commission (2024–2029), entitled ‘Europe’s Choice’, on 18 July 2024.This document sets out a new plan for Europe’s sustainable prosperity and competitiveness. In particular, it highlights the need to streamline and accelerate business operations in Europe to ensure speed, consistency and simplification across all policies. Each Commissioner is to be tasked with reducing administrative burdens and simplifying implementation, specifically through deregulation, reducing reporting obligations, strengthening trust, improving enforcement and speeding up authorisation procedures. It is clear, therefore, that von der Leyen intended from the outset to undertake a review of all EU measures as a task for the second European Commission.

Von der Leyen appointed Valdis Dombrovskis as Commissioner for Economy and Productivity; Implementation and Simplification. In her Mission Letter, von der Leyen stated the following with regard to this role: ‘You will ensure that existing rules are fit-for-purpose and focus on reducing administrative burdens and simplifying legislation. You must contribute to reducing reporting obligations by at least 25% – and for SMEs at least 35%.’ 

  In light of this, the European Commission put forward ten omnibus proposals in 2025: The Omnibus I package covered the simplification of the Carbon Border Adjustment Mechanism (CBAM) and on sustainability issues, including the Corporate Sustainability Reporting Directive (CSRD) and the Corporate Sustainability Due Diligence Directive (CSDDD). The Omnibus II package covered investment simplification. The Omnibus III package covered the simplification of the Implementation of the Common agricultural policy Strategic Plan. The Omnibus V package covered Small and Mid-Caps, digitalisation and common specification. The Omnibus V on Defence, the Omnibus VI on Simplification of Chemicals Legislation, the Omnibus VII on Digital Simplification Package ( See on this blog a series of comments) , the Omnibus VIII on Environmental Legislation Package, the Omnibus IX on Automotive and the Omnibus X on Food and Feed simplification package. These ten proposals are estimated to reduce administrative costs by €11.9 billion.

  The first von der Leyen European Commission placed a strong emphasis on environmental protection, publishing the ‘European Green Deal’ in December 2019. In July 2021, the document ‘Fit for 55: The EU’s 2030 climate neutrality goals’ was published to ensure the effective implementation of the European Green Deal. Consequently, numerous measures to promote greening have been adopted, including the European Climate Law, and existing measures have been amended. In contrast to these, the above-mentioned Omnibus proposals can be seen as a step backwards. As mentioned above, Omnibus I, relating to the CBAM, the CSRD and the CSDDD, was proposed on 26 February 2025. This paper will focus on the CSDDD.

2. Amendment of the CSDDD

In 2011, the United Nations Human Rights Council adopted the ‘Guiding Principles on Business and Human Rights’. In response, the EU adopted CSDDD on 13 June 2024, which came into force on 25 July of the same year. This imposes actual and potential human rights and environmental due diligence obligations on companies not only in relation to their own operations, but also to those of their subsidiaries and the activities carried out by business partners within their value chains. In other words, companies subject to this Directive must: (1) integrate due diligence into their policies and risk management systems; (2) identify and assess actual or potential adverse impacts and, prioritising where necessary; (3) prevent and mitigate potential adverse impacts, and address and minimise the extent of actual adverse impacts;(4) provide remediation for actual adverse impacts; (5) engage meaningfully with stakeholders; (6) establish and maintain a notification mechanism and complaint-handling procedures; (7) monitor the effectiveness of due diligence policy and measures; and (8) disclose information regarding due diligence (Article 5(1) of the CSDDD).

  The omnibus (amendment) proposal as regards the dates (COM(2025)80) and the proposal (COM(2025)81) on CSRD and CSDDD did not alter this CSDDD provision. However various changes were proposed. The former proposal as regards the dates was adopted on 14 April 2025 as Directive (EU) 2025/794, entering into force on 17 April 2025. With this amendment, the deadline for transposition and implementation of the CSDDD was extended by one year to July 2027, and that the date of application to large enterprises was postponed to July 2028. The latter proposal was adopted on 24 February 2026 as Directive (EU) 2026/470 and entered into force on 18 March 2026. This amendment aims to significantly relax due diligence obligations requirements concerning the following points.

First, the scope of application of the CSDDD was reduced. Specifically, with regard to companies, the turnover threshold was raised from EUR 450,000,000 to EUR 1,500,000,000, and the employee threshold was raised from 1,000 to 5,000 (see preamble (37) of Directive (EU) 2026/470 and Article 2(1)(a) of the amended CSDDD).

Second, the amendment relaxed the obligations for business partners, reducing the burden on companies and making stakeholder engagement more proportionate. In the scoping exercise, companies are not required to systematically identify adverse impacts at entity level. Rather, they are required to scope general areas and companies should rely on information that is reasonably available to them. They should not be required to request any information from business partners where no likely and severe risks were identified. In addition, companies should only request information from business partners where that information is necessary (cf. preamble (39)-(41) of the Directive (EU) 2026/470, Article 8 (2) and (2a) of the CSDDD).

Third, the concept “stakeholder” has changed. The former Article 3(1)(n) provision of the CSDDD was replaced by the following: ‘Stakeholders’ refers to the company’s employees, those of its subsidiaries and business partners, their trade unions and workers’ representatives, individuals or communities whose rights or interests are or could be directly affected by the company’s, its subsidiaries’ and its business partners’ products, services and operations, and the legitimate representatives of those individuals or communities. With this amendment, the phrase ‘national human rights and environmental institutions and civil society organisations whose purposes include the protection of the environment’ has been deleted. This means that environmental NGOs and civil society organisations can no longer be considered stakeholders. Consideration is barely given to the following categories of people: ‘individuals or communities in the neighbourhood of plants operated by business partners where those individuals or communities are directly affected by pollution, or indigenous people whose right to lands or resources are directly affected by how a business partner acquires, develops or otherwise uses land, forests or waters’. Furthermore, in line with the concept “stakeholders”, the amendment of CSDDD deleted Article 29 (3) point (d) which had laid down, ‘reasonable conditions are provided for under which any alleged injured party may authorise a trade union, non-governmental human rights or environmental organisation or other non-governmental organisation, and, in accordance with national law, national human rights’ institutions, based in a Member State to bring actions to enforce the rights of the alleged injured party, without prejudice to national rules of civil procedure’. The amendment reduces the possibility of civil liability and representative actions brought by trade unions, human rights and environmental organisations at EU level, while leaving the Member States with discretion at national level.

   Fourth, the CSDDD was amended with regard to penalties. Preamble (48) of Directive (EU) 2026/470 states that ‘to ensure a level playing field across the Union and in line with the objective of harmonisation, Member States should be required to set a uniform maximum limit of pecuniary penalties of 3 % of the net worldwide turnover’. Therefore, Article 27 (4) of the former CSDDD laid down, ‘when pecuniary penalties are imposed, they shall be based on the company’s net worldwide turnover. The maximum limit of pecuniary penalties shall be not less than 5 % of the net worldwide turnover of the company in the financial year preceding that of the decision to impose the fine’ (underlined by author). Following the amendment, Member States must now ensure that the maximum limit of pecuniary penalties is set at 3 % of the net worldwide turnover of the company.

   Fifth, with regard to preventing potential adverse impacts, the previous CSDDD provision required companies not only to suspend relationships with business partner, but also to terminate them if the potential adverse impact is severe. Following the amendment, however, the word “terminate” was deleted from the amended CSDDD (See Article 10(6)(b), Article 11(7)(b)).

   Sixth, with regard to monitoring, the amendment based on the Omnibus Proposal I reduced the frequency of plan reassessments from once a year to once every five years (amendment to Article 15 of the CSDDD).

Seventh, taking into account the principle of subsidiarity, the Union-wide liability regime is abolished alongside Article 29 (1) of the CSDDD. Instead, national law regulates liability. Following the amendment, Article 29 (5) of the CSDDD lays down, ‘Companies that have participated in industry or multi-stakeholder initiatives or used independent third-party verification or contractual clauses to support the implementation of due diligence obligations may nevertheless be held liable in accordance with national law’.

Furthermore, the deadlines in several provisions (Article 16, 17, 18, 19, 24 of the CSDDD) have been postponed.

3. Concluding remarks

The amendments for the CSDDD have restricted the scope of EU measures, exempted SMEs, postponed implementation deadlines, reduced the number of reviews, and generally relaxed EU measures. Thus, the amendments of the CSDDD can be viewed as a reversal or a step backwards, as Gómez indicated, for example. The amendments certainly reduce administrative costs and respond to requests from industry by exempting SMEs without compromising the effectiveness of the CSDDD, as this does not affect the achievement of their objectives. Nevertheless, there are undoubtedly issues, such as the loss of the supervisory role previously granted to NGOs and civil society under the CSDDD.

 Finally, it must be pointed out that there are two factors which prevent the situation from deteriorating further. First, Member States are permitted to legislate more. With the amendment of the CSDDD, the Union-wide liability regime was deleted. However, preamble 49 of Directive (EU) 2026/470 states that ‘such deletion is without prejudice to any provision of the applicable national law allowing a trade union, a non-governmental human rights or environmental organisation, any other non-governmental organisation or a national human rights institution to bring actions to enforce the rights of the alleged injured party, or to support such actions brought directly by such party’. Second, Article 1 (4) was added to the CSDDD to ensure that the amendment of CSDDD does not affect EU or national law relating to the protection of human, employment and social rights, or the protection of the environment or of protection of climate.

 Although ten omnibus proposals were tabled in 2025, this does not mark the end of the process. Further omnibus proposals could be submitted in the future. This can be inferred from the European Commission’s Annual Work Programme for 2026, which was published on 21 October 2025. In the programme, the European Commission states that it will continue to simplify existing EU measures, building on the work carried out in 2025.  

Yumiko Nakanishi

Professor, Graduate School of Law, Hitotsubashi University, Tokyo