What a year, what a rollercoaster ride! In the latest 2025 newsletter, we recap the developments of the past three months for you. There’s a lot going on – from PPWR, CSRD, and EFRS standards, EUDR, CBAM, green claims, EmpCo, and the UWG amendment to the German Packaging Act. We also recommend the four most important steps you should take now.
Ten years ago, the legislative process in the EU still took 10 to 15 years. About five years ago, the EU began announcing and developing laws at a significantly faster pace. This year, things have started to slide, and we have gone from solid ground to quicksand. To put it politely, the political stability that one would expect from legislation has evaporated – as has reliability.
CSRD and EFRS standards
- Reform of ESRS standards: In the summer/fall of 2025, the European Financial Reporting Advisory Group (EFRAG) published heavily abridged ESRS drafts, which were reduced in scope by over 55 percent. A 60-day consultation was then conducted until September 29, 2025, with the aim of reducing data points, clarifying double materiality logic, and improving implementability for companies. The reform was developed primarily for later waves of the CSRD and will only come into effect in the CSRD’s scope from 2026/27 onwards. EFRAG was supposed to submit its final recommendation to the Commission by November 30, 2025, so we are now on the verge of a political assessment. (Source)
- Omnibus package to ease the burden and limit the scope:
In mid-November 2025, the European Parliament adopted its position on the so-called “Omnibus”: In the future, reporting will primarily be required from the largest companies, while smaller companies (especially SMEs) will be partially relieved of CSRD/ESRS and parts of the EU taxonomy. (Source) - Consequences for companies:
- Very large companies subject to reporting requirements must continue to expect full CSRD/ESRS implementation, but can count on adjusted, leaner standards.
- For smaller groups (especially those outside the capital market), there are signs of noticeable relief or later/reduced application. Planning should take these scenarios into account.
- Comparison of the thresholds under discussion (employees & financial criteria)
- Number of employees: This is currently still the central point of conflict in the trilogue. Parliament wants 1,750 FTE, while the Commission/Council insists on 1,000 FTE.
- Scope: A significant reduction in scope is likely, but it remains unclear how large the reduction will be.
- SME relief: A “freeze” for companies with fewer than 750 employees has already been decided, meaning that smaller groups will not have to report until 2028 at the earliest.
- Impact on planning: The final decision is expected in 2026, so companies are currently best advised to work with scenario planning (1,000 and 1,750 thresholds).
- We have summarized a detailed comparison of the thresholds under discussion for you in tabular form:
EUDR (EU Deforestation Regulation)
There is a major political movement surrounding the EU Deforestation Regulation, resulting in a postponement of one year.
- Council adopts mandate for “targeted revision“: On November 19, 2025, the member states agreed on a negotiating mandate that provides for a simplification of the EUDR and a one-year postponement of its application to give authorities and companies more time to prepare. (Source)
- Parliament supports postponement: On November 26, 2025, the European Parliament confirmed the one-year postponement. The new target dates are:
- December 30, 2026 for large companies and
- June 30, 2027 for micro and small enterprises (Source)
- Commission guidance: Back in September 2025, the Commission had already clarified its guidelines (source), including
- “negligible risk,”
- the depth of due diligence in complex supply chains,
- the interpretation of legality requirements, and
- the question of when packaging falls under the EUDR (only if it is placed on the market as a separate product).
- Consequences for companies:
- Companies gain time, but do not receive a free pass. They should continue to develop their geodata, traceability, and supply chain processes, nonetheless. Many have already invested, and the basic regime remains in place.
CBAM (Carbon Border Adjustment Mechanism)
September 2025 also brought important changes for the Carbon Border Adjustment Mechanism.
- “Omnibus I” – Simplifications adopted:
- On September 10, 2025, the European Parliament approved simplifications to the CBAM that are intended to ease the burden on SMEs and occasional importers. For example, there are exemptions for very small import volumes and expanded use of default values. (Source)
- The Council finally adopted this CBAM amending regulation on September 29, 2025. (Source)
- In terms of content, it concerns:
- simplified calculation and reporting requirements, particularly for small import volumes,
- the possibility of postponing the purchase of CBAM certificates for 2026 until February 2027, and
- a stronger link with the EU ETS and potentially with other emissions trading systems (e.g., UK ETS). In the future, linked ETS countries could be partially exempted from CBAM. (Source)
- Political flank: The EU is also using CBAM as leverage for global CO₂ pricing and is negotiating exemptions or alternative mechanisms with India, for example, as part of trade talks – so far without a fundamental exemption from CBAM. (Source)
- Consequences for companies:
- For importers of iron/steel, aluminum, cement, fertilizers, etc., January 2026 remains the start date for the CBAM, which is subject to payment. However, the administrative implementation will be somewhat simplified.
- Important: Companies should finalize their internal carbon accounting structures and supplier data in good time.
Green Claims & EmpCo
Brief overview (as of mid-December 2025)
- EmpCo (Empowering Consumers for the Green Transition Directive)
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- Deadlines: This EU directive has been in force since March 2024. The implementation deadline for member states is September 27, 2026.
- Objective: Protection against greenwashing through stricter rules for environmental and sustainability claims. These include, among other things:
- prohibition of vague claims (“environmentally friendly,” “green”) without clear evidence,
- stricter rules for sustainability labels, and
- requirements for future promises (e.g., “climate neutral by 2030” only with a plausible strategy).
- Relationship to the Green Claims Directive (GCD)
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- The Green Claims Directive is currently on hold politically. The process was “put on ice” in 2025.
- The EmpCo therefore remains the main set of rules for environmental and sustainability claims until further notice.
- The GCD could be resumed later as “lex specialis,” but this is currently irrelevant for implementation.
- Implementation in Germany (UWG amendment)
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- Germany is implementing the EmpCo via an amendment to the Unfair Competition Act (UWG). A draft bill from the Federal Ministry of Justice and Consumer Protection (BMJ) is available. Implementation must be completed by fall 2026. Initial drafts show that Germany will impose strict rules.
- Key elements of implementation:
- definition and regulation of environmental claims,
- evidence requirements for “green” advertising claims,
- stricter requirements for labels/seals,
- obligation to provide realistic transformation plans for future promises.
- Significance for companies:
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- Even without the Green Claims Directive, environmental and sustainability claims must be substantiated, precise, and verifiable.
- Claims such as “climate neutral,” “CO₂-neutral,” “environmentally friendly”, etc. require clear and reliable evidence with the implementation of EmpCo.
- Companies should already be preparing the following measures for 2025/2026:
- create a claim inventory,
- establish a system for substantiating statements
- adapt internal communication and review processes.
PPWR (Packaging and Packaging Waste Regulation)
The EU Packaging and Packaging Waste Regulation (EU) 2025/40 is omnipresent. Starting with the next newsletter, we will dedicate a separate blog to the PPWR to keep you fully informed about all developments.
- Legal status: The PPWR has been in force since February 11, 2025, and will generally apply from August 12, 2026, with some longer transition periods. It replaces the previous Packaging Directive and creates a directly applicable, harmonized legal framework for all member states. (Source)
- Developments in recent months:
- Exceptions for load securing: A draft Delegated Act has been presented for the exemption of strapping bands and stretch films in the area of load securing from the targets of Article 29(2) and (3) of the 100% reusable quota in inter- and intra-company transport.
- In some member states, there is growing pressure to adapt national implementation to the PPWR. Examples include Germany (VerpackDG; see below) and France (AGEC/EPR adjustments). (Source)
- There are an increasing number of practical guides and “10 things you need to know” papers that specify the obligations (recyclate quotas, reuse targets, design for recycling, bans on certain types of packaging, etc.) for companies. We recommend our PPWR white paper.
- Consequences for companies: The focus is now on implementation planning until 2026 and on synchronization with existing EPR systems such as LUCID/Duale Systeme in Germany or CITEO & Co. in France.
German Packaging Act
The draft bill for a new packaging law has just been released.
- VerpackDG: At the end of November 2025, the Federal Ministry for the Environment, Nature Conservation, Nuclear Safety, and Consumer Protection (BMUV) published a draft bill for a new “Packaging Law Implementation Act” (VerpackDG). It is intended to replace the previous Packaging Act (VerpackG). (Source)
- Objectives of the draft:
- adaptation to the PPWR to ensure the smooth coexistence of German and EU regulations,
- maintaining and further developing established structures (e.g., dual systems, Central Agency Packaging Register),
- expansion of producer responsibility, additional prevention/reduction measures, and more ambitious recycling quotas.
- Consequences for companies:
- For distributors in Germany, it is foreseeable that:
- the administrative framework (LUCID, dual systems) will remain in place, but
- the scope of obligations and quotas will increase and be more closely linked to the PPWR.
- The draft may still change during the parliamentary process, but the direction is clear: more responsibility and higher requirements.
- For distributors in Germany, it is foreseeable that:
Four recommendations for the new year
- Preparation for the PPWR should be a priority. Implementation will begin with staggered transition periods starting in August 2026. That’s practically tomorrow. Complete our PPWR Impact Check!
- Priority 2 is the question of what sustainability data and evidence you as a company need for your customers. A good sustainability report is the best calling card for a company and helps with banks, customers, and other stakeholders.
- You need transparent climate data for this sustainability report. A company carbon footprint is standard, while the product carbon footprint (more on this in our article) is becoming a distinguishing feature. Climate risk assessments should be a must-have as a basis for longer-term planning of corporate development.
- Supply chain assessments are required not only in the CSRD or EUDR, but also in the PPWR. A good, pragmatic supplier risk assessment strengthens your company’s resilience and can have a very positive impact on a wide variety of purposes. Keyword here: EcoVadis (see article).
