How does the omnibus procedure affect procurement?

The European Commission has adopted a package of measures called the Omnibus Regulation. It aims to simplify EU regulations and reduce the bureaucratic burden on businesses. Which directives and regulations does the EU Omnibus affect and what changes?

What is the Omnibus procedure?

The term "Omnibus" refers to a legislative initiative in EU legislation. It makes changes to several sets of rules simultaneously and bundles them into a single legal act.

What is the aim of the Omnibus procedure?

The Omnibus procedure became known through the Budapest Declaration, announced by EU Commission President Ursula von der Leyen on 8 November 2024. It is intended to reduce the administrative burden on businesses by 25 per cent from 2025. These proposals could save annual administrative costs of around 6.3 billion euros and mobilise additional public and private investments of 50 billion euros, according to estimates.

The initiative aims to strengthen competitiveness within the EU by reducing bureaucracy, particularly through simplifications in sustainability reporting. EU regulations are to be adapted more efficiently and overlapping requirements standardised.

For example, the requirements of the EU supply chain law (CSDDD) are more closely aligned with other regulations such as the sustainability directive (CSRD).

Which laws are being adjusted with the omnibus?

The EU's omnibus procedure adjusts several laws on sustainability reporting and corporate obligations, including

• Corporate Sustainability Reporting Directive (CSRD)
• Corporate Sustainability Due Diligence Directive (CSDDD)
• EU taxonomy regulation
• EU deforestation regulation (EUDR)
• Carbon Border Adjustment Mechanism (CBAM)

Additionally, other regulations such as general accounting guidelines and auditing standards could be affected.

How is the EU supply chain law (CSDDD) changed by the omnibus procedure?

The omnibus procedure makes some changes to the Corporate Sustainability Due Diligence Directive (CSDDD). These are specifically:

• Indirect suppliers: They only need to be included in risk management on a case-by-case basis.

• Stakeholder group: The group of stakeholders to be included is limited to those directly affected and their representatives. Consumers and human rights and environmental organisations no longer need to be consulted. Only individuals and communities whose rights or interests may be directly affected by a company's products, services, or business activities are considered stakeholders.

• Consultation obligation: The consultation of stakeholders is only required for specific procedural steps that have a direct connection to the respective duty of care. For certain steps, such as the decision to suspend business relationships or the development of monitoring indicators, it is completely omitted.

• Climate protection plans: These are no longer mandatory but voluntary and are aligned with the CSRD directive on sustainability reporting. Climate protection plans that are not implemented will therefore remain without consequences in the future.

• Time shift: The deadline for implementing the CSDDD by member states is extended by one year. Companies also receive more time. Large companies (over 5,000 employees, turnover > 1.5 billion euros) will only start from July 2028. For medium-sized companies (over 3,000 employees, turnover > 900 million euros), the start has been postponed to July 2029, and smaller companies must meet the requirements from July 2030.

• Civil liability: The much-criticised civil liability for breaches of due diligence obligations is completely abolished.

How is the Corporate Sustainability Reporting Directive (CSRD) influenced by the omnibus procedure?

The omnibus procedure brings significant changes to the EU directive on sustainability reporting. These include:

• Scope: Only companies with more than 1,000 employees, a turnover of over 50 million euros or a balance sheet total of over 25 million euros are required to report. This change alone reduces the number of companies required to report by about 80 percent. Companies below the new thresholds can voluntarily produce reports according to a simplified standard.

• "Value chain cap": Companies only need to obtain information from suppliers with fewer than 1,000 employees if they report according to the simplified standard.

• Extension of deadlines: The introduction of reporting obligations is postponed by two years. Companies that were originally supposed to report in 2026 or 2027 will now start in 2027 or 2028.

• Report content: The number of data points to be reported is significantly reduced. Sector-specific standards are dispensed with.

• Audit of the sustainability report: The audit will be carried out permanently with "limited assurance".

How is the taxonomy regulation affected by the omnibus procedure?

The omnibus procedure also brings several changes to the EU taxonomy regulation. Here too, the reporting obligations are simplified, reducing the administrative burden for companies. The main adjustments are:

• Scope: Only companies with more than 1,000 employees and a turnover of over 450 million euros are now required to report according to the EU taxonomy. Companies below these thresholds can report voluntarily, which particularly relieves smaller companies.

• Reporting obligations: The number of data points to be disclosed is reduced by 70 percent, which significantly reduces complexity and effort. The OpEx KPI (operating expenses) only needs to be specified if the proportion of taxonomy-eligible revenues accounts for at least 25 percent of total revenue.

• Materiality thresholds: New is the so-called materiality threshold. This states that economic activities only need to be reported if they have a certain significance for sustainability.

• “Do no significant harm”: The corresponding criteria (DNSH) are simplified and revised to facilitate application.

Changes to the CBAM regulation through the omnibus procedure

The CBAM regulation (EU 2023/956) is also amended by the omnibus procedure. As with the EU supply chain law and sustainability reporting, the bureaucratic burden is also expected to decrease here. The main adjustments are:

• New de-minimis threshold: The previous de minimis threshold of 150 euros per shipment is replaced by a new threshold: Imports of less than 50 tonnes of CBAM-relevant goods per year are now exempt from reporting obligations. According to Germany Trade & Invest (gtai), this change mainly relieves SMEs and companies that only occasionally import CBAM-relevant goods. This accounts for about 90 percent of importers.

• An evaluation of the previous transition phase concluded that tens of thousands of importers are responsible for only about one percent of emissions, while a few importers are responsible for the majority of recorded emissions. Therefore, the change would still capture 99 percent of emissions.

• CBAM registrants: Companies importing more than 50 tonnes of CBAM goods still need the status of an authorised CBAM registrant. In the future, however, they can appoint a representative or service provider to take over the reporting obligations and submission of certificates on behalf of the importer.

• Longer deadlines: From 2026, annual reporting and accounting deadlines will apply, which are to be postponed. Instead of a submission on 31 May of the following year, it should be possible to submit the declaration by 31 August of the following year.

• Calculation of emissions: Emissions for certain products made of steel and aluminium mainly arise from the production of the precursors. Here, the calculation specifications are to be changed so that the emissions of the precursors are mainly taken into account. EU precursors, for which a CO2 price has already been paid under the EU Emissions Trading Scheme (ETS), should no longer be considered in the future.

• CO2 prices from third countries should be simplified in their calculation by standard values.

• CBAM certificates: The start of sales is postponed to 2027. The price of a CBAM certificate depends on the price of ETS certificates and is derived from the average price of the respective previous week. Only the price of the CBAM certificates sold in 2027 will reflect the price level of 2026.

Criticism of the omnibus procedure

The omnibus procedure is intended to reduce bureaucracy but is still being discussed controversially. Critics fear that the planned simplifications could weaken important due diligence and sustainability standards. In addition, the exact design of many changes remains unclear.

What happens next?

So far, the omnibus procedure is only a proposal by the European Commission. Both the European Parliament and the Council still need to approve it. The procedure must be completed by the end of 2025 so that the simplifications can come into effect in time for the start of the implementation phase in 2026. Without an agreement, the implementation phase will begin as planned on 1 January 2026.