"EU's 'Omnibus' green rollback likely to hit legal challenge, experts warn"

The EU’s efforts to roll back green reporting and due diligence rules adopted by the previous commission are moving fast.

And last week's draft proposals from both member states and the European Parliament show broad political alignment, making a deal to water down the laws likely later this year.

But there's likely to be trouble ahead. Because the so-called Omnibus simplification package is being rushed through without an impact assessment, the EU's push to slash reporting obligations may soon be challenged in court, leading to “years of legal uncertainty where no one really knows what the law says.” 

So says David Frydlinger, a partner at Cirio, one of Sweden’s leading commercial law firms, in an interview with EUobserver.

He recently co-authored a legal analysis of the Omnibus package, and concluded that “the commission hasn’t done its legal homework,” he told EUobserver in an interview. 

One area of concern is that under EU law, once a certain level of protection has been achieved, any rollback must be justified as proportionate and necessary.

But proportionality checks have been skipped. “Scrapping protection against forced labour and child exploitation without proving less dramatic measures are ineffective would trigger legal challenges from progressive member states and NGOs immediately,” he said.

The Omnibus hasn’t even officially been adopted, but there are already signs that some may be preparing to do just that. 

Spain and Denmark have already voiced concerns. And a group of eight NGOs and trade unions recently filed a complaint with the European Ombudsman, arguing the process disregards environmental and human rights protections.

The Omnibus is meant to help EU businesses. But “if challenged in the court, parts of the Omnibus could be annulled,” said Frydlinger. The ensuing legal chaos "would only harm EU competitiveness, as well as the people and climate goals Europe claims to protect.”[...]

Legal risk

All this talk about cutting red tape abstracts why these regulations are there in the first place, and why it's not simply a matter of less is more. 

“What the commission and Mr Warnborn call ‘red tape’ is in fact legislated protection of rights recognised in the EU Charter and the European Convention,” said Frydlinger. 

“Changing such a law isn’t forbidden, but you can’t roll back protections without separate tests of necessity and proportionality and no such analyses have been published," he said. 

The legal principle underpinning this is one of ‘non-regression’. Repealing parts of the reporting and due diligence laws without showing that milder alternatives could work therefore carries the “highest risk” of being challenged in court, Frydlinger said. 

“I find it very unlikely the EU Court of Justice wouldn’t apply a full proportionality test,” if the law is weakened to quite the degree Macon or Warnborn envision, he added.

But that’s not the only point where the Omnibus’ legality is doubtful. 

Due diligence rules currently apply across entire supply chains, but the commission wants to limit them to direct suppliers only. 

That would exclude exactly the parts of the chain where the worst human rights and environmental abuses often occur — such as informal cobalt mines, smallholder farms, or garment factories like Rana Plaza, the Bangladeshi plant that collapsed in 2013 which resulted in 1,100 deaths and sparked the political push that resulted in the CSDDD over a decade later. 

The commission admits that the Omnibus would “partially diminish" the positive effects of the CSDDD on human rights.

And as Frydlinger pointed out, “courts can’t ignore it when authorities admit to weakening human rights protections without demonstrating that it is necessary or proportional.”

Another legal risk emerges from deleting the original requirement for companies to adopt and implement a transition plan. That obligation has now been softened to merely outlining intended actions. [...]