On 14 April 2025, the Council of the EU formally adopted the ‘Stop-the-clock’ Directive under the Omnibus I package. The Directive postpones the dates of application of certain corporate sustainability reporting and due diligence requirements, as well as the transposition deadline of the due diligence provisions.
The Omnibus I package was adopted by the European Commission at the end of February 2025, with the aim of simplifying EU legislation relating to sustainability. The Council of the EU notes that it and the European Parliament have treated the proposal for a Stop-the-clock Directive as part of Omnibus I with ‘utmost priority’ in order to give EU companies legal certainty regarding their reporting and due diligence obligations.
The Directive seeks to postpone:
- By two years, the entry into application of the Corporate Sustainability Reporting Directive (CSRD) requirements for large companies that have not yet started reporting, as well as listed SMEs.
- By one year, the transposition deadline and the first phase of the application (covering the largest companies) of the Corporate Sustainability Due Diligence Directive (CSDDD).
The Council of the EU explains that its and the European Parliament’s agreement to the proposal will allow them time to agree on substantive changes to the CSRD and CSDDD, which have also been proposed by the Commission as part of the Omnibus I package.
Next steps
The Directive entered into force on 15 April 2025 and must be transposed by Member States into their national legislation by 31 December 2025.