Omnibus update: New agreement on CSRD and CSDDD and deferral of reporting requirements

In February 2025, the European Commission presented the so-called Omnibus I, which proposes major changes to the key sustainability regulations Corporate Sustainability Reporting Directive ("CSRD") and Corporate Sustainability Due Diligence Directive ("CSDDD"). The background to the proposal is to simplify the regulatory frameworks for sustainability reporting (CSRD) and due diligence in the value chain (CSDDD) with the aim of reducing the administrative burden on companies and increasing competitiveness. The EU has previously decided that the application of CSRD will be postponed by two years for those companies that have not yet started applying the framework. The CSDDD has not been implemented yet, but the application for this directive will also be postponed. Since the launch of Omnibus I, there have been intense negotiations on how the content of the regulations will actually change.

On 8 October 2025, the major political groups in the European Parliament reached an agreement on the terms of the CSRD and CSDDD. The agreement now clarifies the types of companies that will be covered by each set of rules, providing much-needed clarity for business.

New thresholds and scope

According to the political agreement, the CSRD will only cover companies with more than 1,000 employees and the CSDDD only companies with more than 5,000 employees. This means that companies below these new thresholds will not have to apply the CSRD or CSDDD as currently proposed.

Next steps in the decision-making process

The agreement now needs to be formally approved by the JURI (Legal Affairs) Committee of the European Parliament, before the full Parliament will take a position on the proposal. The CSRD has already been implemented in Swedish legislation, notably the Annual Accounts Act. After the final version has been approved at EU level, Swedish legislation will need to be adapted before the changes enter into force. 

Swedish postponement - the "Stop the clock" bill

One element of Omnibus I has been to postpone the application of the CSRD by two years while the terms are renegotiated, the so-called "Stop the clock" that we previously reported on. Now, the Swedish government has also submitted the bill "Deferred sustainability reporting requirement for certain companies (Prop. 2025/26:21)" to the Swedish Parliament. It proposes that the introduction of CSRD in Swedish law be postponed by two years for companies that have not already started applying CSRD, i.e. companies in the so-called wave 2 and 3.

The bill is expected to be adopted by the Swedish parliament shortly and the new rules will enter into force on 31 December 2025. During the postponed introduction, companies that have already been covered by older rules will continue to report on sustainability according to these.

While the CSRD is postponed, work will continue on finalising the CSRD. However, with the political agreement now struck, companies with fewer than 1,000 employees now have clarity that they will most likely not have to start applying CSRD after the postponement. 

Overall importance for Swedish companies

The combination of the EU agreement and Swedish policy measures now provides greater clarity for companies:

• The rules are postponed.
• Companies below the thresholds will probably not have to apply CSRD and CSDDD in practice when the rules enter into force.
• Many companies in wave 2 and 3, which have not already started reporting under the CSRD, are unlikely to be covered by the CSRD
• However, companies that have previously reported under the old sustainability rules will continue to do so until further notice.

This gives companies increased clarity and both time and opportunity to adapt to the final regulations, as they are now being chiselled out in both Brussels and Stockholm.

For questions and support on how this may affect your company, please contact us at DLA Piper.