Europe eases corporate obligations and presents reindustrialization plan

Europe is simple. This is the message that the European Commission wanted to convey on Wednesday 26 February by unveiling regulatory simplifications for businesses. Europe is also a large industrial continent focused on clean technologies. And to convince investors, the Commission unveiled a large number of support measures for businesses on the same day.

"In recent years, we have created a lot of obligations, sometimes redundant," acknowledged Commissioner Stéphane Séjourné when presenting these measures. "We want to show that Europe is a continent where it is good to do business, and that knows how to reform without a chainsaw," he added in an allusion to Argentinian President Javier Milei and Elon Musk, responsible for drastically reducing the spending of the American administration with his Department of Government Efficiency (DOGE).

In terms of support measures, the Commission announced the creation of a decarbonisation bank, which could raise up to €100 billion. It will help electro-intensive sectors (steel, aluminium, cement) to switch to clean energy. The Commission will also "introduce sustainability and European preference criteria in public procurement" in order to support demand for green cement and steel.

Europe wants to "protect the continent's economy"

This point gives the measure of the mental revolution underway in Brussels. Faced with Chinese competition, but also the risk of falling behind the United States, Europe has decided to strengthen its muscles. It now assumes to give preference to European companies, moving away from the time when the Commission primarily ensured free competition.

The European Union will also invest to lower the price of energy, while its cost is two to three times higher in Europe, compared to the United States. And still to gain competitiveness, it will develop joint purchases of critical raw materials (lithium, cobalt).

"The EU has too little growth. What we are presenting today is a reindustrialisation plan that aims to protect and grow our economy," said Dutch Commissioner Wopke Hoekstra.

Commission reviews application thresholds

To convince investors, the European Union is also cutting the obligations imposed on companies. The previous Commission had adopted, after ten years of work, a series of texts: the directive on corporate sustainability reporting (CSRD), the European duty of care (CS3D), a regulation on green taxonomy and a carbon border adjustment mechanism.

The continent's employers' organisations had denounced the new administrative burden for them. The Commission is reviewing the application thresholds and the number of data to be collected: only companies with more than 1,000 employees will, for example, have to publish a report on their sustainability, which exempts 80% of them.

Regarding the Duty of Care Directive, companies will no longer be required to analyse the activity of their entire value chain. Their responsibility will be limited to their first-tier suppliers. They will no longer have to carry out this analysis every year, but every five years.

For the carbon border tax, all small exporters (less than 50 tonnes per year) will be exempted, i.e. 90% of them. "The mechanism will remain effective because 1% of exporters are responsible for 99% of carbon emissions," explains a Commission official.

The sustainable development goal is maintained

The EU is therefore trying to convince people that it is not giving up on its sustainable development goals, but is simply reviewing their implementation. "We are not questioning the 'green deal', it is not a step backwards. But we are putting in place mechanisms to make our industry more competitive, to have quality jobs in Europe," insisted Teresa Ribera, the Commission's number two, responsible for the energy transition and the main architect of this plan.

In the Commission's vocabulary, this series of simplification measures is called the "Omnibus". It is only the first. The Commission plans to launch four more this year, to continue to simplify the lives of businesses.

She estimates that this first train could allow European companies to save 6 billion euros each year in administrative costs. These measures will however have to go through the European Parliament.