US presses EU to ease sustainability rules that hamper trade
US urges EU to ease corporate sustainability rules, citing Turnberry trade commitments. Brussels has made some concessions but resists further changes.
The United States has renewed its push for the European Union to relax corporate sustainability regulations, arguing that these rules create unfair hurdles for American businesses and contradict commitments made during July's trade talks in Turnberry, Scotland.
US Ambassador to the EU Andrew Puzder took to social media on Friday to press the bloc on the issue. He pointed to the Framework Agreement, under which the EU pledged to ensure its Corporate Sustainability Due Diligence Directive (CSDDD) and Corporate Sustainability Reporting Directive (CSRD) do not create undue restrictions on transatlantic trade.
These directives require large companies operating in the EU, including American firms, to disclose their environmental and social impacts, as well as working conditions across their supply chains. Puzder argued that the extraterritorial provisions of these laws harm American businesses and workers.
Washington is also pushing for changes to the EU's Carbon Border Adjustment Mechanism (CBAM), which applies charges to imports of goods that do not meet the bloc's carbon emissions standards.
The pressure comes as both sides shift focus to non-tariff barriers following the implementation of tariff commitments agreed in July. Three sources familiar with the discussions indicated that joint statements covering these non-tariff elements are expected in the autumn.
Brussels has already made some adjustments to its policies over the past year, including softening its anti-deforestation law and methane emissions rules. The EU also scaled back its corporate sustainability rules in December, limiting the CSDDD's scope to the largest companies and delaying its compliance deadline to mid-2029. The CSRD now applies only to firms with more than 1,000 employees, up from the original threshold of 250.
However, several sources familiar with the EU's position said the bloc is not planning further concessions on these measures. US companies, including ExxonMobil, had sought broader changes, such as a complete exemption for foreign firms.
A statement accompanying Puzder's post acknowledged some positive reforms in the December Sustainability Omnibus but said those reforms failed to fully address US concerns regarding the directives.