EIC and FIEC call on MEPs to reject the final CSDDD compromise proposal

On 15 March, the Committee of Permanent Representatives of the Governments of the Member States to the European Union (COREPER) gave its green light with a narrow majority to the Corporate Sustainability Due Diligence Directive (CSDDD). The European Parliament's Legal Affairs Committee (JURI) followed suit on 19 March. The CSDDD will be voted on in a final vote in the plenary of the European Parliament on 24 April 2024.

When scrutinising the final compromise text negotiated by the Belgian EU Presidency, FIEC and EIC welcome the fact that the EU Council and the European Parliament have corrected their erroneous decision taken during the trilogue negotiations to classify the construction sector as a "high impact sector". The two federations are further pleased to note that their joint demand to raise the thresholds for in-scope companies to 1.000 employees and €450 million net turnover was met at the last minute of the legislative process.

At the same time, FIEC and EIC maintain their opposition against the final text, as it will burden affected companies with excessive bureaucracy and expose them to significant liability risks given the construction sector’s complex and changing supply chains. The introduction of a civil liability and the harsh sanctions regime will place a particularly heavy burden on the construction industry. The linkage of the CSDDD with public procurement has the potential to exacerbate the situation, as it will affect the construction industry more than other sectors.

The two federations further criticise the intrusive clause on stakeholder engagement and the low level of harmonisation, which could lead to ‘gold-plating’ by certain Member States and an unlevel playing field within the EU Single Market.

FIEC and EIC expect that the costs associated with implementation will be high and will affect a larger group of companies than expected given the structure of the European construction industry and the anticipated ‘trickle down’ effect. With regard to overseas business, FIEC and EIC are concerned that European contractors may be forced to withdraw from markets where sufficient information on supply chains is not readily available.

In the light of the sensitivity and the importance of the subject matter, FIEC and EIC call on the Members of the European Parliament to reject the current proposal in the April plenary session.

Please find our official press release below.