Publication of Omnibus I Directive

In February 26, 2026, Directive 2026/470/EU —"Omnibus Directive I"—, which significantly changes the European regulatory framework for corporate sustainability, was published. This directive introduces notable amendments to corporate reporting rules —Directive 2022/2464/EU, or "CSRD"— and due diligence requirements —Directive 2024/1760/EU, or "CS3D"—.

In our Legal Flash | Approval of Omnibus I (December 2025), we outline the key developments introduced by the directive, which must be transposed by March 19, 2027.

Following its publication in the Official Journal of the European Union (OJEU), we:

• summarize the key aspects of the Omnibus I Directive; and
• provide a timeline detailing upcoming milestones in sustainability reform.

Omnibus Directive I: Key aspects regarding corporate sustainability reporting

• Significant reduction in scope. Starting with the financial year beginning on January 1, 2027, only companies that meet the criteria outlined in the table below will be required to report in compliance with the CSRD:
  
  The remaining companies may voluntarily report under simplified rules, which the European Commission will approve by July 19, 2026. This reform effectively excludes approximately 90% of the companies originally covered.
  
  In certain cases, these excluded entities are "first wave" companies already reporting under the CSRD, or those that should have done so had all Member States transposed the CSRD by the established deadline. The Omnibus I Directive permits Member States to exempt these companies from submitting information for the years 2025 and 2026 in accordance with the CSRD.

• Limited verification. Sustainability reporting will be subject to limited scope verification under a delegated act, which the European Commission expects to approve by July 1, 2027.
• Protection for small and medium-sized enterprises (SMEs) —value chain cap—. Information requests are restricted to companies within the value chain that employ an average of no more than 1,000 employees. This measure reduces the indirect impact of the CSRD on SMEs.
• Review clauses. The European Commission will evaluate the use of voluntary rules by April 30, 2029, as well as a possible extension of the CSRD scope by April 30, 2031.

Omnibus Directive I: Key due diligence aspects (CS3D)

• Important reduction in scope. The directive introduces a significant reduction in scope by essentially tripling the previous thresholds. This change substantially decreases the number of companies subject to the CS3D requirements:
  
  
  
• New deadline. The transposition deadline for the CS3D has been postponed to July 26, 2028. The general obligations will enter into force on July 26, 2029.
• Due diligence changes. First, it consolidates and clarifies the "risk-based approach", replacing the previously used "entity-based approach". Second, it limits information requests within the activity chain based on necessity, reasonableness and risk-based priority criteria. It also establishes an obligation to consult the "interested parties".
• Climate transition plans. These are eliminated as a standalone obligation; however, if such plans exist, they must be incorporated into the sustainability reports.
• Liability regime. The harmonized EU liability regime has been removed. However, the directive maintains (a) the right to judicial remedy and compensation under Member State laws, and (b) a penalty cap set at 3% of worldwide turnover.
• Prohibition of gold plating. Member States are prohibited from introducing additional due diligence obligations beyond those established in the CS3D.
• Review clause. The key aspects of the CS3D will be evaluated before July 26, 2031.

Next milestones of the Omnibus I Reform

In our Post | European 2025 sustainability trends and what we expect in 2026, published in February, we analyze last year’s measures and provide forecasts for this year. For corporate sustainability reporting and due diligence, we highlight the following milestones: 

• Entry into force of the Omnibus Directive I: March 18, 2026
• Rules on voluntary corporate sustainability reporting: July 19, 2026
• General European Sustainability Reporting Standard (ESRS) simplification delegated act: By September 2026 (at the latest)
• Deadline for transposing the Omnibus I Directive: March 19, 2027
• Deadline for transposing the CS3D: July 26, 2028
• General application of CS3D obligations: July 26, 2029

For more information, please contact our Cuatrecasas experts in the Knowledge and Innovation Group.