European Commission Delays ESRS Sustainability Standards for Non-EU Companies to 2027

The European Commission announced the de-prioritization of the adoption of European Sustainability Reporting Standards for non-EU companies under the CSRD, pushing the deadline beyond October 2027. The move is part of a broader simplification agenda identifying 115 legislative acts as non-essential, and delays reporting requirements that had been scheduled to apply to large non-EU companies operating in the EU from 2028.

The ESRS for third-country undertakings was originally due by end of June 2024, was already postponed to June 2026 by EU lawmakers, and has now been further delayed indefinitely beyond October 2027. Non-EU companies with significant EU revenues have faced growing uncertainty about their obligations under the CSRD, and the delay provides additional time for businesses headquartered outside the bloc to prepare. The de-prioritization was revealed in a Commission letter to EU financial regulators listing legislative follow-up acts it deemed non-essential.

The delay carries particular significance for large Indian companies with EU market presence. Under the original CSRD roadmap, Indian multinationals generating substantial revenues in the EU faced potential reporting obligations from 2028 under ESRS tailored for third-country companies. The postponement beyond 2027 reduces near-term compliance pressure, but Indian companies would be well-advised to monitor the Omnibus process, which may ultimately alter the scope of non-EU company obligations more substantially. The US under the Trump administration had specifically pushed back on CSRD requirements for American companies, which may have contributed to the Commission's decision.

The delay to ESRS for non-EU companies is part of the broader Omnibus I process, which proposes raising the CSRD's general applicability threshold from 250 to 1,000 employees, dramatically narrowing the number of EU companies subject to the regulation. A stop-the-clock directive earlier in 2025 paused implementation for companies not yet reporting. Other de-prioritized acts include ESRS for listed SMEs and sector-specific ESRS, though these are also likely to be affected by the outcome of the broader Omnibus negotiations expected to conclude in late 2025.

Key figure — ESRS for non-EU companies delayed beyond October 2027