CSDDD – Amending Directive published in the Official Journal of the European Union

On 26 February 2026, Amending Directive (EU) 2026/470 was published in the Official Journal of the European Union. It is part of “Omnibus I” package and introduces changes to the Corporate Sustainability Due Diligence Directive (CSDDD) (Directive (EU) 2024/1760). In addition, the Amending Directive contains adjustments to the Corporate Sustainability Reporting Directive (CSRD).

Following a provisional agreement during trilogue negotiations, the European Parliament approved the proposed legislation in December 2025, and the Council of the European Union gave its approval on 24 February 2026. The Amending Directive will enter into force 20 calendar days after its publication in the Official Journal of the European Union.

Significant changes to the CSDDD

Reduced scope of application

The scope of the CSDDD has been significantly reduced by the Amending Directive. Unlike the Commission’s proposal, the CSDDD now applies to undertakings with at least 5,000 employees and a global net turnover of at least €1.5 billion (Article 2(1) of the CSDDD, as amended). Previously, the thresholds were 1,000 employees and global net turnover of €450 million.

Furthermore, non-EU undertakings are only covered where they, or the group of undertakings to which they belong, generated a net turnover of more than €1.5 billion in the European Union in the financial year preceding the last completed financial year (Article 2(2) of the CSDDD, as amended).

Risk-based approach

The European Commission had proposed limiting the due diligence obligations of obliged undertakings to the activities of their own operations, their subsidiaries and their direct business partners.

The final Directive goes beyond this proposal and introduces a far-reaching limitation: on the basis of a purely risk-based approach, undertakings may focus on those areas of their own operations, the operations of their subsidiaries and, where linked to their value chains, the operations of their business partners where adverse impacts are most likely to occur and are most severe (Article 8(2) of the CSDDD, as amended).

Furthermore, it is no longer necessary to carry out comprehensive mapping of the entire supply chain and value chain. Instead, a scoping exercise is sufficient. In doing so, undertakings may rely on information that is reasonably available.

The Directive lays down rules on the type and extent of information to be obtained in the context of due diligence, linking this to the size of the business partner in the value chain. When implementing the Directive, Member States are to ensure that information may be required from business partners with more than 5,000 employees only where this information is necessary to comply with due diligence obligations. In the case of business partners with fewer than 5,000 employees, information may be requested where, based on reasonable judgement, the information cannot be obtained by other means (Article 8(2a) of the CSDDD, as amended). This is intended to protect small and medium-sized enterprises in particular from extensive information requests in future.

Climate transition plans

While the Commission and the Council of the European Union initially advocated simplified requirements in their original proposals, the final Directive provides for the complete deletion of the transition plan.

Civil liability

The harmonised European civil liability regime has been removed. However, a review clause has been introduced, which allows for a future reassessment of a harmonised liability framework at Union level. Procedural facilitations for affected persons have been maintained. These concern, for example, rules on limitation periods and evidence. Member States must still ensure that courts, in accordance with national law, can order the disclosure of evidence that lies within the control of the company (Article 29 of the CSDDD, as amended).

Penalties

Previously, under the CSDDD, the maximum limit for pecuniary penalties was to be set at not less than 5% of the undertaking’s worldwide net turnover; in future, the maximum limit will be 3% of the undertaking’s worldwide net turnover (Article 27(4) of the CSDDD, as amended). The Commission is to issue guidelines in this regard.

Implementation period

The implementation deadline for the CSDDD has been extended until 26 July 2028; the new obligations will therefore apply only from 26 July 2029 onwards.

Outlook

The legal uncertainty of recent months regarding supply chain due diligence obligations has at least been resolved at the European level. For business practice, it is to be hoped that the German legislature will promptly amend the Supply Chain Due Diligence Act so as to ensure legal certainty and planning reliability.

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