Cutting red tape, the Omnibus Initiative, the abolition of reporting obligations: many terms are currently circulating, all sharing one common thread. The drive to relieve the European economy of excessive bureaucratic burdens is very much present at the moment. At the same time, the EU Commission continues to pursue its “Green Deal,” and with it the goal of making the EU climate-neutral by 2050. Since the enactment of the European Climate Law (Regulation (EU) 2021\/1119), the EU Commission has adopted ambitious rules to achieve this goal. These include:<\/p>\n\n\n\n
Although these instruments take very different approaches, they impose obligations on numerous companies engaged in import and export activities. Very few of these companies are likely to fall under the CSRD, which is aimed primarily at large or capital-market-oriented companies.<\/p>\n\n\n\n
At present, only the CBAM Regulation is directly applicable; the other instruments are either about to become applicable (the EUDR from 30 December 2025, or 30 June 2026 for micro and small enterprises) or are casting their shadow ahead of time, making clear that they will bring with them numerous documentation and reporting obligations for those affected. This has drawn considerable criticism, in particular from trade and industry associations, out of concern that these additional obligations will undermine the competitiveness of the European economy, and in particular of already hard-pressed small and medium-sized enterprises, vis-\u00e0-vis companies from third countries.<\/p>\n\n\n\n
The EU Commission has taken this criticism seriously and has launched an initiative (the so-called Omnibus Initiative) aimed at relieving businesses of this burden while continuing to pursue its climate-neutrality goal. There has been a development here:<\/p>\n\n\n\n
1. Content and status of the Omnibus procedure<\/strong> Parliament and the Council have now agreed initial adjustments regarding Directive 2022\/2464 (CSRD) and Directive 2024\/1760 (CSDDD). Directive (EU) 2025\/794 <\/a><\/strong>(OJ EU L of 16 April 2025) adopted the following changes:<\/p>\n\n\n\n The EU Commission had pushed for the European Parliament and the Council to prioritise the Omnibus Initiative’s legislative packages. It is therefore to be hoped that, in particular, the planned changes to CBAM (see Schlagbaum issue 02\/2025 on this)<\/a><\/strong> will soon acquire the force of law. Companies currently subject to CBAM find themselves somewhat in limbo here, since, should the planned changes not enter into force, they will need to address the process of obtaining authorised CBAM declarant status. If, however, the changes proposed by the Commission prevail in the legislative process, many of the companies currently affected are likely to fall outside the scope of application (see Schlagbaum issue 03\/2025<\/a><\/strong> for further discussion of this issue).<\/p>\n\n\n\n 2. Status of the LkSG<\/strong> Since this Act, too, entails extensive documentation and reporting obligations for the companies concerned, the question of whether it will remain in force continues to be debated politically, causing considerable uncertainty.<\/p>\n\n\n\n What is the current state of play?<\/strong> Most recently, BAFA, as the competent supervisory authority, postponed the obligation to submit reports and announced that the reports will first be reviewed as of the reference date of 1 January 2026 (https:\/\/www.bafa.de\/DE\/Lieferketten\/Berichtspflicht\/berichtspflicht_node.html<\/a>).<\/p>\n\n\n\n Indications as to the future of the Act can be found in the new Federal Government’s coalition agreement:<\/p>\n\n\n\n “Furthermore, we will abolish the national Supply Chain Due Diligence Act (LkSG). It will be replaced by an act on international corporate responsibility that transposes the European Supply Chain Directive (CSDDD) with a low administrative burden and in an enforcement-friendly manner. The reporting obligation under the LkSG will be abolished immediately and will cease to apply entirely.<\/em> Although the term “abolition” is used, an important point is noted at the same time: the European Supply Chain Directive (CSDDD) will still come into effect, albeit further delayed (see above). The provisions of the national LkSG will be adapted to align with that Directive. Against this background, an interim abolition of the LkSG in the meantime appears unlikely. Companies subject to the Act are advised to continue observing the LkSG and fulfilling their obligations under it, since these remain formally in force. The fact is that, at present, no statutory amendments to the Act have yet been made. We will continue to monitor developments for you!<\/p>\n\n\n\n
The EU Commission’s proposals to amend the various regulations and directives are grouped under the terms Omnibus 1 <\/a><\/strong>and Omnibus 2. We already outlined these in Schlagbaum issue 02\/2025<\/a><\/strong>. They are currently making their way through the legislative process, in which the European Parliament and the Council of the EU are considering the proposals. Put simply, the aim of these initiatives is to reduce the number of companies covered by the rules and, for those companies that remain subject to them, to reduce, in particular, the scope of the reporting obligations.<\/p>\n\n\n\n\n
In Germany, the LkSG already provides a statutory framework governing companies’ due diligence obligations relating to their supply chains, with a focus on respecting human rights and protecting the environment within the supply chains of the companies concerned. Since 1 January 2023, the Act has applied to companies with at least 3,000 employees, and since 1 January 2024, to companies with at least 1,000 employees.<\/p>\n\n\n\n
It should be made clear that the LkSG remains in force.<\/p>\n\n\n\n
The existing statutory due diligence obligations will not be sanctioned pending entry into force of the new act, with the exception of severe human rights violations. We support the Commission’s ‘Omnibus’ initiative to significantly reduce and postpone the extensive requirements governing the content of EU sustainability reporting, in particular for small and medium-sized businesses<\/em>.” (p. 60 of the CDU\/CSU\/SPD coalition agreement<\/a><\/strong>)<\/p>\n\n\n\n