Under pressure, EU to cut green rules February 27, 2025

Despite the push for clean technology, climate groups have expressed concern about the watering down of green business rules.

By AFP - Agence France Presse

Under pressure, EU to cut green rules

by Raziye Akkoc and Camille Camdessus

The European Union is expected to roll back a series of environmental rules this week as it pushes ahead with a deregulation initiative in a bid to keep up with the United States and China.

The EU's focus has turned to competitiveness amid concerns over sluggish economic growth - in a significant shift from EU chief Ursula von der Leyen's first term, which focused on tackling climate change.

The issue has taken on an acute urgency with US President Donald Trump promoting an America First strategy that risks a trade war with the EU.

Exasperated companies - as well as major powers France and Germany - are calling on Brussels to facilitate business and reduce energy costs, which are higher than in the United States.

With these concerns in mind, the European Commission will unveil a package of proposals which, according to leaked preliminary documents seen by AFP, will include watering down green standards, as well as measures to reduce energy costs and strengthen the clean technology sector.

They will need the approval of EU states and the European Parliament.

At stake are the new rules on environmental and human rights standards in the supply chain - adopted with fanfare a few months ago, but now attacked as too onerous for companies.

“The reality is that there is an increasingly tense geopolitical context and we cannot ask our companies to invest massively in reporting resources when they should be in a war economy and are in the midst of decarbonization,” said EU industry chief Stephane Sejourne.

Cutting green rules

Two important texts are in the EU's firing line: the Corporate Sustainability Reporting Directive (CSRD), which requires large companies to provide investors and other “stakeholders” with information on their climate impacts and emissions, and the measures taken to limit them.

The other is the Corporate Sustainability Due Diligence Directive (CSDDD) - approved last year - which requires large companies to correct the “adverse impacts on human rights and the environment” of their supply chains worldwide.

In a draft document, the EU states that companies should submit reports on supply chains every five years instead of annually, which will “significantly reduce burdens”.

The document adds that the commission will oblige larger companies - with more than 1,000 employees - to comply with the rules.

Currently, the rules apply to companies with more than 250 employees and a turnover of 40 million euros ($42 million).

The EU believes that with the US “moving away” from the green agenda under President Donald Trump, the bloc must “take a step forward”.

'Mistakes' of the past

The changes are likely to be hotly debated in the EU parliament, with centrist, left-wing and green lawmakers opposed to weakening environmental rules - although some liberals have said they accept the changes.

French centrist Marie-Pierre Vedrenne now considers the rules to have been a “mistake”, despite having previously voted in favor of them.

“The world is changing completely,” she said. “I think we need to say in the European Parliament: 'OK, sometimes we make mistakes'.”

The parliament's socialist group, however, urged Brussels to “review” its approach in a letter last week.

Climate groups are opposed to reducing the rules.

“Changing course now would be very damaging for leading companies that are committed to sustainability and have started investing money and resources to comply with the legislation,” said Amandine Van Den Berghe, from environmental law NGO ClientEarth.

“If the race goes to the bottom, we won't win,” she said.

Europe takes a step forward

Brussels insists that it remains committed to its environmental targets and climate neutrality by 2050.

In sync with the initiative to cut red tape, on Wednesday the EU will present its “Clean Industrial Deal” - a combination of measures for a stronger green technology sector - as well as measures to reduce energy prices.

With Trump rejecting his predecessor's push to strengthen investment in clean technology, Brussels believes there is an opportunity for Europe.

“The fact that the US is now moving away from the green agenda... does not mean that we would do the same. On the contrary. It means we need to take a step forward,” said EU energy commissioner Dan Jorgensen.

Representatives of the business sector in Brussels, however, expressed particular concern that concrete measures to reduce energy costs could come too late.

For example, they pointed to a leaked document that says Brussels will reform state aid rules by July and a legal proposal to reduce the waiting time for renewable energy project licenses that will be introduced by the end of 2025.

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