The ESPR aims to make sustainable products the norm in the EU, replacing the current Ecodesign Directive and introducing broader measures for sustainability.
By Paul A. Davies, Cesare Milani, José María Alonso, Michael D. Green, James Bee, and Telmo Iriondo
On 18 July 2024, the Ecodesign for Sustainable Products Regulation (ESPR) entered into force. The ESPR forms part of a package of measures central to achieving the objectives of the European Commission’s 2020 Circular Economy
Denmark’s unprecedented carbon removals fund has facilitated the coexistence of corporate and national carbon claims in carbon accounting.
By Jean-Philippe Brisson, Paul A. Davies, Lars Kjølbye, John-Patrick Sweny, and Qingyi Pan
In the past few years, stakeholders in the carbon market have debated how to integrate the voluntary carbon market (VCM) and the emerging international carbon market governed by the Paris Agreement — Denmark’s recent move to allow stacking of voluntary carbon credits and nationally determined
The key principles for a Carbon Management Strategy and draft act on the revision of the Carbon Storage Act create new opportunities for investors and project developers.
By Tobias Larisch, Alexander “Stefan” Rieger, John-Patrick Sweny, Jean-Philippe Brisson, and Joachim Grittmann
The German Federal Government’s Carbon Management Strategy and the revision of the Carbon Storage Act (Kohlendioxid-Speicherungsgesetz, KSpG) aim to remove current obstacles to (i) Carbon Capture and Storage (CCS) and (ii) Carbon Capture and Utilisation (CCU)
The proposed regulation would ban forced labour-made products from the EU market, affecting companies’ supply chains and requiring compliance checks.
By Paul A. Davies, Michael D. Green, and James Bee
On 5 March 2024, the European Parliament and European Council announced that they had reached a provisional political agreement on the regulation (Regulation) that aims to prohibit any product manufactured using forced labour from being placed on or exported from the EU market.
The European Commission proposed the
The European Parliament and the Council of the EU have made some significant changes to the European Commission’s proposal.
On 5 February 2024, the European Parliament and Council of the EU announced that they had reached a provisional political agreement on the text of the ESG Ratings Regulation (the Regulation). The agreed text was subsequently published on 14 February 2024. The Regulation was initially proposed by the Commission in June 2023, and seeks to introduce a new regulatory regime for ESG ratings providers “operating in the Union”. Refer to this Latham blog post for previous commentary on the proposal.
The target aims to set the path for climate neutrality by 2050.
By Paul A. Davies, Michael D. Green, and James Bee
On 6 February 2024, the European Commission (Commission) presented its recommendations for the EU’s 2040 climate target, following a detailed impact assessment on potential emission reduction pathways. This publication aligns with the implementation of the EU’s Climate Law, which enshrines the EU’s commitment to become climate-neutral by 2050, alongside the 2030 target to reduce net greenhouse gas (GHG) emissions by at least 55%, relative to 1990.
The Commission recommends a 90% net GHG reduction by 2040, as compared to 1990 levels. Notably, the recommendation refers to “net” GHG reduction, and therefore opens the door for the use of carbon removal technologies within the EU to meet the target.
The new rules would oblige companies to integrate their human rights and environmental impact into their management systems.
By Paul A. Davies, Michael D. Green, and James Bee
On December 14, 2023, the European Council (Council) and European Parliament (Parliament) reached provisional agreement on the Corporate Sustainability Due Diligence Directive (CSDDD). The agreement follows an extensive negotiation processes, which began in June 2023, after the European Commission had initially proposed the CSDDD in February 2022.
The CSDDD’s key aim is to enhance the protection of the environment and human rights globally. The CSDDD as proposed will set obligations for companies regarding the actual and potential adverse impacts of their own operations, those of their subsidiaries, and those carried out by business partners, described as the “business chain of activities.” The CSDDD would also establish a requirement for large EU companies to adopt a plan to ensure that their business model and strategy are compatible with the Paris Agreement, i.e., including concrete targets and measures in line with limiting global warming to 1.5 °C.
The proposed CSDDD would establish rules on penalties and civil liability for infringements (although these will ultimately be set by Member States).
The regulation aims to minimise the EU’s contribution to deforestation and forest degradation.
By Paul A. Davies, Michael D. Green, and James Bee
The European Deforestation Regulation (EUDR) entered into force on 29 June 2023, following publication in the Official Journal of the European Union. However, the main requirements and prohibitions of the EUDR will apply from 30 December 2024, 18 months after the entry into force.
The regulation forms part of the European Green Deal (for more information on the Green Deal, refer to Latham’s blog post here), which includes a proposal to ensure EU consumption does not contribute to deforestation and forest degradation. The EUDR will repeal and broaden the scope of the existing EU Timber Regulation.[i]
The Commission is also consulting on proposed targeted amendments to the Taxonomy Climate Delegated Act and on the Taxonomy Disclosures Delegated Act.
By Paul A. Davies, Michael D. Green, and James Bee
On 5 April 2023 the European Commission opened a consultation on its proposal for four additional environmental objectives under the EU Taxonomy Regulation[1] (the Taxonomy), including: (i) sustainable use and protection of water and marine resources; (ii) transition to a circular economy; (iii) pollution prevention and control; and (iv) protection and restoration of biodiversity and ecosystems.
The Commission is seeking feedback on technical screening criteria (TSC) for economic activities that may substantially contribute to one or more of those four environmental objectives. The TSC do not only identify the technical requirements that an activity must meet to be considered to make a substantial contribution to one of these areas, they also specify the conditions by which the activities can be considered to not do any significant harm to the remaining areas.
The Commission has already adopted TSC related to the economic activities of two other environmental objectives: climate change mitigation and climate change adaptation.
The Commission is also proposing amendments to the Taxonomy Climate Delegated Act, introducing additional activities that may be considered to substantially contribute to climate change mitigation or climate change adaptation, as well as the Taxonomy Disclosures Delegated Act.
The proposals form part of the Green Deal Industrial Plan and aim to scale up technology and materials for the energy transition.
By Paul A. Davies, Beatrice Lo, JP Sweny, Alexander Buckeridge-Hocking, Michael D. Green, and James Bee
On 16 March 2023, the European Commission (Commission) formally proposed two legislative initiatives and announced the development of a European Hydrogen Bank as part of its program to enhance the EU’s competitiveness in green technologies and support its transition towards net zero greenhouse gas emissions by 2050.