Article
New draft by EU-Commission: FAQs on the EU Taxonomy Regulation
What companies should know
The European Commission has recently published a draft of a new FAQ (Frequently Asked Questions) on the application of the EU Taxonomy Regulation. It covers various aspects of the Regulation and provides background information. In this article, we'll highlight some of the key points of this FAQ to help businesses understand it better.
Background
The EU Taxonomy Regulation is a set of rules that was introduced in April 2021. The aim is to create a single EU framework to facilitate sustainable investment, giving investors a clear direction on the sustainability of their investments. The Regulation requires companies within its scope to assess the sustainability of their activities against defined criteria.
The results of this assessment must be disclosed in an annual report. According to the Commission's mission statement, the assessment serves as a basis for future evaluation of sustainable investments and can have a significant impact on the perception of the company.
Accordingly, the EU taxonomy joins CSRD, EUDR, LkSG or CBAM in the jungle of relevant regulations that companies have to comply with.
New draft FAQs on the application of the EU Taxonomy Regulation
The European Commission has published a new draft set of FAQs on the application of the EU Taxonomy Regulation. The aim is to make it easier for companies and investors to implement the EU Taxonomy and to demonstrate possible synergies with the Corporate Sustainability Reporting Directive (CSRD).
In addition, the FAQs provide new information on the content requirements and interpretation aids for the individual compliance requirements that companies will have to meet in the future.
The new draft FAQs focus on three main areas:
- Scope: Who is covered by the obligations of this Regulation and what types of economic activities are affected?
- Disclosure requirements: What information do companies and financial market participants have to disclose and what is the disclosure process?
- Technical review criteria: How will the technical review criteria be applied?
These FAQs are an important resource for companies seeking to understand the significant implications of the EU Taxonomy Regulation. The impact on business and investment strategies should not be underestimated.
We strongly recommend that companies familiarise themselves with the requirements of the EU Taxonomy Regulation and the explanations provided in the FAQs. If you have any further questions or concerns about the application of the Regulation, you should seek professional legal advice. Our team is always on hand to help you navigate these complex regulations.
Published: December 2024
