The regulatory landscape for corporate sustainability reporting and due diligence is evolving. Recent legislative developments at both the EU and French levels have resulted in the postponement of key ESG compliance deadlines, marking a significant shift in the implementation timeline.
On April 16, 2025, the European Union published the “Stop the Clock” Directive1, part of the broader “Omnibus Package,” which postpones the application of the Corporate Sustainability Reporting Directive (CSRD)2 and the Corporate Sustainability Due Diligence Directive (CS3D)3. In swift alignment, France enacted the DDADUE 2025 Law4 on May 2, 2025, updating national legislation in accordance with the revised CSRD calendar.
This postponement was justified by the intention to first observe the initial reports published by large listed companies before extending the obligations under the CSRD to a broader group of firms, and more broadly, to allow companies time to adapt their reporting and compliance systems — with the aim of strengthening the competitiveness of European businesses.
Additional regulatory adjustments are currently under discussion at the EU level as part of the upcoming “Omnibus II Package.”
The “Stop the Clock” Directive brings a major adjustment to the CSRD timeline by postponing sustainability reporting obligations for the second and third waves of companies initially targeted by the CSRD:
Importantly, Wave 1 companies — publicly listed firms with more than 500 employees and annual revenues above €50 million — are not affected by the postponement. They remain subject to the original reporting obligations.
As for Wave 4 entities — non-EU companies generating more than €150 million in annual turnover within the EU and operating through a subsidiary covered by CSRD or a branch with annual turnover exceeding €40 million — the reporting schedule also remains unchanged. Their first reports will be due in 2029, in respect of financial years starting in 2028.
The “Stop the Clock” Directive also affects the timeline for implementing the CS3D, which imposes due diligence obligations on companies regarding environmental protection and human rights. For the first wave of companies—those with more than 5,000 employees and global turnover exceeding €1.5 billion—the application of the CS3D is now postponed by one year. These companies must be fully compliant by July 26, 2028.
However, no delay has been granted for other companies falling within the scope of the CS3D. Their compliance deadlines remain unchanged.
EU Member States have been granted an extended deadline of July 26, 2027, to transpose the directive into national law.
The French “DDADUE law”, published on May 2, 2025, aligns French national law with the CSRD timeline adjustments introduced by the “Stop the Clock” Directive. It amends the deadlines originally set by Ordinance No. 2023-1142 of December 6, 2023, and also introduces regulatory changes aimed at easing or clarifying certain ESG obligations.
Article L. 822-40 of the French Commercial Code, which imposed criminal penalties for failure to appoint a sustainability information auditor or for obstructing the certification process, has been repealed. These offenses were previously punishable by up to two and five years’ imprisonment, and fines of €30,000 and €75,000 respectively.
Certain companies already required to publish a GHG emissions report (BEGES) under Articles L. 232-6-3 and L. 233-28-4 of the French Commercial Code are now exempt from doing so under Article L. 229-25 of the French Environmental Code.
