Latest on EU CSDDD proposal

Latest on EU CSDDD proposal

(Article by Panagiota Maragkozoglou, Associate, published in the Corporate & Commercial Newsletter of the ILO on July 31, 2023)

On 23 February 2022, the European Commission submitted a Corporate Sustainability Due Diligence Directive (CSDDD) proposal for the:

• issuance of a new EU Directive on corporate due diligence in relation
to sustainability; and
• modification of EU Directive 2019/1937.

The CSDDD proposal responds to the call of the European Parliament(2)
with respect to the need to submit a legislative proposal on mandatory
value chain due diligence.
Given that after the publication of the CSDDD proposal, the legislative
procedure consists of its review by the Council of the EU as well as the
European Parliament, on 1 December 2022, the former one adopted its
agreed negotiating position thereon, which included amendments
regarding (among others):

  • the subject scope of application;
  • the notion of “value chain”;
  • directors’ duties; and
  • civil liability.

In the latest developments, on 25 April 2023, the European Parliament’s committee on legal affairs (JURI) drafted a report entailing amendments to the CSDDD proposal. The report addressed the threshold criteria as well as the rest of the issues raised by the Council – although JURI disagreed with the Council’s stance on the majority of those issues. Subsequently, on 1
June 2023, the European Parliament agreed on its own position, thus allowing interinstitutional negotiations to commence. However the CSDDD is not expected before 2024.

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