VDA President Hildegard Müller regarding Omnibus Initiative to Simplify Reporting Requirements

"Excessive bureaucracy is placing a significant and ever-increasing burden on companies in the German automotive industry, particularly those in the automotive medium-sized sector. It is therefore good that the EU Commission wants to counteract this with its Omnibus initiative to simplify reporting obligations and is taking the first steps to remove unnecessary bureaucratic burdens from companies. Nevertheless, the initiative can only be a first step towards a comprehensive reduction in bureaucracy on the part of Brussels."

EU Supply Chain Act and CSRD Directive

"Many large companies and also large medium-sized companies have already made extensive preparations to meet the complex requirements of the EU Supply Chain Act and the CSRD reporting obligations. The postponement of the first implementation deadlines of the EU Supply Chain Act by one year and the postponement of the CSRD reporting obligations for certain companies by two years therefore have little effect on them. This relief comes too late. However, smaller companies could benefit from it – they gain valuable time to prepare themselves as best as possible for the complex requirements and to learn from the experiences of other companies.

Companies can only be held liable for risks over which they have influence; anything else is unrealistic. It is therefore logical that the EU Supply Chain Act now refrains from EU-wide civil liability and limits due diligence obligations to direct business relationships. However, although the EU Commission is largely averting future additional costs for companies, this does not really relieve companies of existing regulations at this point in time.

Raising the thresholds for employees and net turnover for the application of the EU Supply Chain Act and the EU Corporate Sustainability Reporting Directive (CSRD) are fundamental steps in the right direction, but they are not enough. The regulations continue to directly affect medium-sized industrial companies and place a significant burden on them. The VDA therefore proposes a threshold of 3,500 employees.

In addition, sales thresholds do not provide reliable information about the size of a company in industry, since the high costs of intermediate products and equipment account for a large part of sales without this reflecting economic performance.

In addition, the planned streamlining and simplification of the CSRD and CSDDD regulations will help to improve compliance with the regulations. The consistent implementation of the announced simplifications is now important. This applies in particular to the planned harmonization of data points, because the fact is that sustainability reporting, the EU Supply Chain Act and the taxonomy collect thousands of often redundant and often overlapping data. These reporting obligations must finally be merged. It must also be checked whether redundant reporting obligations also exist due to other requirements."

European Carbon Border Adjustment Mechanism (CBAM)

"There are both positive and negative aspects to the changes proposed by the EU Commission to the European Carbon Border Adjustment Mechanism (CBAM). The increase in the CBAM exemption limit and the expansion of the use of CO₂ average values are positive. What is completely incomprehensible, however, is that a legislative proposal for the CBAM expansion has already been announced for the beginning of 2026. No facts can be created before the results of the review of the CBAM measures scheduled for the end of 2025 are available. The planned Carbon Pricing Diplomacy Task Force can basically help to work towards CO₂ pricing systems globally."

EU Taxonomy

"With regard to the Taxonomy Regulation, raising the thresholds for the reporting obligation is not enough to sufficiently relieve the burden on medium-sized automotive companies. In the further process, the Commission should place much greater emphasis on the financing of transition activities within the framework of the taxonomy."