The new 'Omnibus' Directive proposal from the European Commission endangers corporate due diligence obligations

On February 26, 2025, the European Commission unveiled an “Omnibus” Directive proposal that threatens to strip the Corporate Sustainability Due Diligence Directive (CSDDD) of its substance. Presented as a "Simplification", it proves to be a an major weakening of already established due diligence obligations

First, the proposal introduces a "legal ceiling", limiting the scope of the requirements to levels below international standards such as the UN Guiding Principles or the OECD Guidelines. It also removes the obligation for companies to systematically conduct in-depth assessments of their indirect business partners: they would only be required to act in the event of “plausible information” indicating incidents or major risks. Furthermore, the periodic monitoring frequency would shift to every five years (instead of annual monitoring), effectively undermining the directive’s preventive power.

Moreover, the text discards the EU civil liability regime, leaving each Member State to legislate on this matter. The result: a fragmentation of the law and a weakening of legal certainty for victims. Along the same lines, financial sanctions, which were previously linked to turnover, would be reduced, encouraging some companies to view human rights violations as merely a “cost of doing business.”

Finally, the Omnibus proposal no longer obliges a company to terminate a business relationship affected by adverse impacts, nor does it require consulting all stakeholders. The Commission boasts "EUR 320 million in savings" thanks to these measures suggesting that the protection of human rights and the environment is being relegated to second place.

The text must now be submitted to the Parliament and the Council for review and approval. There is still time to block the proposal and ensure the protection of human rights and the environment.