The EU Competitiveness Compass and its Impact on REACH and Other Regulations
Following the Draghi and the Letta Reports, the European Union (EU) is considering simplifying several pieces of legislation and reducing the regulatory and administrative burden imposed on businesses to increase competitiveness. These objectives were communicated in the recently published European Commission Communication titled “The Competitiveness Compass for the EU,” which was officially published in the Official Journal of the EU on January 29, 2025.
The Competitiveness Compass, which will guide the Commission's work in its 2024-2029 mandate, identifies as core areas of action:
- Innovation,
- Decarbonization and competitiveness, and
- Security and resilience.
One of the policy initiatives to achieve these objectives is the proposed adoption of an Omnibus Simplification Package, scheduled for publication on February 26, 2025. This package aims to significantly reduce the reporting burdens imposed on businesses by consolidating and simplifying the requirements under multiple EU sustainability laws, including the EU Taxonomy Regulation, the Corporate Sustainability Reporting Directive (CSRD), and the Corporate Sustainability Due Diligence Directive (CS3D). The result could reshape the international landscape for sustainability and due diligence reporting.
Importantly, the Competitiveness Compass highlights that the REACH Regulation will also be simplified, bringing significant benefits for the competitiveness of the chemical industry.