/>iOpen Questions Regarding the Taxonomy Regulation
While the legislative file of the EU Taxonomy Regulation has been reopened with some proposed amendments by the Commission in its recently released Omnibus Sustainability Package, and a notice providing useful guidance to companies subject to the EU Taxonomy.
Following scrutiny by the European Parliament and the Council, the Taxonomy Environmental Delegated Act, the amendments to the Taxonomy Disclosures Delegated Act and to the Taxonomy Climate Delegated Act were published in the Official Journal on 21 November 2023 and these came into force on 1 January 2024.
The EU Commission released a Commission Notice on the interpretation and application of specific EU law provisions on 5 March 2025. Notably, the notice contains technical clarifications responding to frequently asked questions (FAQs) on the Technical Screening Criteria set out in the Taxonomy Climate Delegated Act (as amended) and the Taxonomy Environmental Delegated Act, as well as on the disclosure obligations for the non-climate environmental objectives laid down in the Taxonomy Disclosures Delegated Act.
The aim of the notice is to help stakeholders comply with the regulatory requirements in a cost-effective way and to ensure that the reported information is comparable and useful also in scaling up sustainable finance. Thereby, the EU Commission attempts to assist businesses in putting the law into practice by answering 155 questions that cover both the interpretation of the law and the justification of its provisions.
Key Topics of the Notice
The EU Commission specifically addresses inquiries about the following topics:
- Mitigation and adaptation to climate change
- Water and marine resources
- Circular economy transition
- Pollution prevention and control
- Biodiversity and ecosystems
- Generic Do No Significant Harm (DNSH) criteria
The questions in Section IX regarding the Taxonomy Disclosures Delegated Act reporting requirements are especially pertinent to the financial industry, with specific information given on the following subjects:
- Timeframe for reporting on Taxonomy eligibility and alignment of economic activities
- Modified reporting templates included in the Taxonomy Environmental Delegated Act
- CapEx and OpEx reporting scope
- Terminology interpretation
The Omnibus Simplification Package
The Commission has prior presented on 26 February 2025 its Omnibus Simplification Package, which aims to create a consolidated sustainability framework, and simplify overlapping EU reporting and due diligence requirements. The omnibus package also proposes several changes to the Taxonomy framework. For companies within the proposed amended CSRD scope (that is, large companies with more than 1,000 employees and a net turnover up to EUR 450 million), the proposal envisages voluntary taxonomy reporting, reducing the number of companies obliged to report their taxonomy alignment. Companies that partially meet EU taxonomy requirements can voluntarily report their progress. The notice published by the Commission on 5 March remains fully relevant in that context.
