Reading the EU's sustainability rules as a market-entry checklist

The EU's Omnibus I Directive entered into force on 18 March 2026, and it did something unusual: it made the sustainability rulebook dramatically smaller. Estimates suggest roughly eighty percent of companies previously captured by the Corporate Sustainability Reporting Directive now fall outside it.

For companies planning European market entry, the instinct is to read this as one less thing to worry about. That reading is wrong in a specific and expensive way.

What actually changed

CSRD. The reporting thresholds rose to more than 1,000 employees and more than €450 million net turnover. The previous thresholds were €50 million turnover, €25 million balance sheet total, and 250 employees. For non-EU parent companies, the test is €450 million net turnover generated in the EU, together with an EU subsidiary or branch above €200 million. The amended requirements apply to financial years beginning on or after 1 January 2027, with first reports due in 2028. Member States must transpose by 19 March 2027.

CSDDD. The due diligence directive was narrowed further, to companies with more than 5,000 employees and more than €1.5 billion net worldwide turnover. For non-EU companies the test is €1.5 billion generated within the EU, with no employee threshold. The obligation to adopt and implement a climate transition plan was removed. Penalties are now capped at three percent of net worldwide turnover, and the harmonised EU civil liability regime was dropped, leaving liability to national law. Transposition is due by 26 July 2028, with application from 26 July 2029.

Why the checklist still matters

Three reasons the scope reduction changes less than it appears to.

Your customers are still in scope. The thresholds exclude most companies but capture the largest — which are precisely the buyers, distributors and retail partners a new market entrant wants. Their obligations run through their value chains. A supplier that cannot produce credible data does not become exempt; it becomes difficult to onboard.

The floor has moved, not the direction of travel. The Commission is required to review both regimes by 26 July 2031, including whether thresholds should be revised and whether high-risk sectors need sector-specific treatment. Building a European business on the assumption that 2026 is the permanent settlement is a bet on a specific political configuration holding for a decade.

Voluntary reporting became a positioning decision. A voluntary standard now exists for companies outside scope. Adopting it is no longer about compliance; it is about whether a company can answer the questions its counterparties are contractually required to ask.

The market-entry reading

Regulatory analysis done properly answers a commercial question, not a legal one: what will it take to be an acceptable counterparty in this market?

Two years ago, that meant preparing for broad reporting obligations. Today it means understanding which of your prospective partners are in scope, what they will require of you, and what evidence you can produce. The regulatory text is the same input. The question it answers is different.

Companies that read the Omnibus as permission to defer are optimising for an obligation they never had, while ignoring the requirement that actually determines market access — the one arriving through their customers' contracts rather than through a directive.