EU Parliament Rejects Weaker Due Diligence Rules, Paving Way for New Vote

The European Parliament recently rejected a mandate from its Legal Affairs Committee concerning the Omnibus 1 directive, which aimed to further simplify rules on sustainability and due diligence. In a closely contested vote, 309 Members of European Parliament (MEPs) voted in favour of the Committee's approach, while 318 voted against it, with 34 abstentions, ultimately leading to the rejection of the proposed mandate.

Looking ahead, the legislative process for these crucial rules will continue to unfold. MEPs are now scheduled to vote on the simplification of sustainability and due diligence regulations on November 13. Following this pivotal vote, discussions are slated to commence with various European governments, with the overarching goal of finalising the comprehensive legislation by the end of 2025.

The primary reason cited for the Parliament's rejection of the Legal Affairs Committee’s mandate was that the proposed amendments were seen as further weakening the text of the directive. Specifically, the Committee had suggested raising the thresholds for applying the duty of vigilance significantly. Its proposal would have limited this duty only to companies with more than 5,000 employees and an annual turnover of at least €1.5 billion, a substantial increase from the initial version’s scope of 1,000 employees and €450 million in turnover. Furthermore, the Committee argued that companies breaching these rules should not face civil liability at the EU level.

This latest development comes in the context of an already diluted legislative framework. The duty of vigilance, as voted on in April 2024, was already a significantly watered-down version of the original draft, limiting its application to only very large corporations. Under these existing, albeit restricted, provisions, concerned companies are mandated to prevent, identify, and remedy violations of human and social rights (such as child labour, forced labour, and safety standards) and environmental damage (including deforestation and pollution) across their entire global value chains, encompassing their suppliers, subcontractors, and subsidiaries worldwide.

The trajectory towards weakening these rules is not a new phenomenon; a discernible step backward in progress began earlier in the year. Notably, France, a nation that frequently prides itself on pioneering a national duty of vigilance, paradoxically initiated efforts to slow the advancement of the European text. In a significant move in May, the French President himself called for the complete abandonment of the European duty of vigilance proposal, further complicating the legislative landscape.