Spain Sustainability Newsletter April

Omnibus Proposal. The EU Council and the European Parliament endorse the "stop-the-clock" directive proposed by the EU Commission in the first omnibus package.

The EU Council and the European Parliament endorse the so called "stop-the-clock" proposal to adopt a directive amending Directives (EU) 2022/2464 (CSRD) and (EU) 2024/1760 (CS3D) in order to:

• delay the application of the CRSD reporting requirements for companies required to do so in 2026 and 2027; and 
•  delay the deadline for transposition and implementation of the CS3D. 

After being endorsed by the two bodies, on 3 April, the European Parliament adopted the Commission's proposal. This adoption follows a vote two days earlier by the Parliament in favour of the urgent procedure, for the proposal to directly be put to a vote by the plenary. Therefore, only the formal approval of the Council and its publication in the OJEU remain pending for it to come into force. 

This "stop-the-clock" proposal is one of the several proposals included in the first omnibus package that the European Commission published on February with the aim of simplifying the EU regulatory framework applicable to companies. This first package additionally included:

• a proposal for a directive amending Directives (EU) 2022/2464, (EU) 2024/1760, 2006/43/EC and 2013/34/EU to simplify due diligence requirements for sustainability as well as sustainability reporting rules, due diligence and taxonomy and reduce the burden of these obligations, restricting them to the largest companies;
•  a proposal for a delegated act amending the delegated acts on Taxonomy subject to public consultation;
• a proposal for a regulation amending the Carbon Border Adjustment Mechanism Regulation to simplify and strengthen it; and
• a proposal for a regulation amending the Invest EU Regulation.

The next step is for these remaining proposals to be submitted to the European Parliament and the Council for consideration and adoption. 

For detailed information about the changes introduced by this initiative in the CSRD and CS3D, you can consult our newsflash about the first omnibus package at the following link.

Other sustainability-related news from recent weeks

Environment

1. New law to prevent food loss and waste throughout the food chain

On 2 April, Law 1/2025, of 1 April, on the prevention of food loss and waste was published in the official gazette (BOE), establishing mechanisms to prevent and reduce food losses and waste by all actors in the food chain. The text is available in Spanish at this link.

This law is applicable to all activities carried out by actors involved in the food chain in Spain, including those dedicated to production, processing or distribution, as well as the hotel and catering industry, restaurants or organisations that distribute donated food and the public administration. Activities involving the withdrawal of products as a result of crisis management measures in specific programmes, such as those for fruit and vegetables or bananas in the Canary Islands, are excluded.

It establishes a hierarchy of priorities that food chain actors must apply with regard to food waste. However, the regulation allows for actors to adapt their actions, providing justification, to the characteristics of their activity or those specific to the sector and a possible regulatory development is envisaged to clarify the way in which this adaptation and its justification should take place.
In addition, food chain actors must: (i) have a plan in place to prevent food loss and waste; and (ii) promote agreements or arrangements to donate their surplus food to social initiative entities and other non-profit organisations or food banks.

It also foresees a set of voluntary good practices for the actors in the chain and it introduces a system of sanctions with fines ranging from 2,000 to 500,000 euros.

The law establishes its entry into force with retroactive effect from 2 January 2025. However, the mandatory measures set out in article 6 will not be applicable until one year after its publication. Therefore, actors still have one year to start implementing the hierarchy of priorities foreseen in the law, as well as to have a prevention plan in place.

2. New obligation for large companies to calculate their carbon footprint

On 18 March, the Government approved the amendment to the Royal Decree 163/2014, of 14 March, by virtue of which the carbon footprint registry was created with the aim of extending its scope of application.

With this amendment:

(a) companies required to report non-financial and diversity information in accordance with Law 11/2018, including those that prepare consolidated accounts and companies whose average number of employees during the financial year exceeds 500 and are considered public interest entities or meet the conditions to be considered large companies; and

(b) the ministerial departments of the Spanish administration (Administración General del Estado), its autonomous institutions, as well as the management entities and common services of the Social security system, and other institutions of the Spanish administrative public sector. 

will be obliged to calculate their carbon footprint and prepare a plan to reduce it in order to be included in the carbon footprint registry. The aforementioned greenhouse gas emissions reduction plan that these organisations must prepare will include, at a minimum, a quantified reduction goal over a five-year time frame, as well as the measures for achieving it.

Furthermore, this information should be made available to the public free of charge and in an accessible way on its website.

The amendment approved by the Government also extends the scope of the registry to new types of absorption projects and to events' carbon footprints (arising directly and indirectly from events with more than 1,500 attendees).

The official text remains to be published in the official gazette (BOE) and therefore its final wording, as well as when the new obligations will come into force, remain still unknown.

3. The legislative proposal amending Law 1/2005 on greenhouse gas emission allowance trading has been withdrawn

The Spanish Council of Ministers has decided to withdraw the legislative proposal to modify Law 1/2005, of 9 March, which regulates the system for greenhouse gas emission allowance trading. The decision, adopted on 25 February 2025, is based on the need to undertake a new examination of the regulatory dossier due to the complexity of the matter and its connection with general and sectorial administrative legislation.

The proposal referred to the Congress in June 2024 and which we covered in the January newsletter (available at this link), will undergo a thorough review before its possible reintroduction.

4. Royal Decree 91/2025, of 11 February, establishing the governance mechanism for energy, climate change and air quality

On 23 February, the Royal Decree 91/2025, which establishes the governance mechanism for energy, climate change and air quality (available in Spanish at this link) came into force. The aim of this regulation is to facilitate compliance with the reporting commitments acquired by Spain under national and international agreements and commitments relating to the fight against climate change and emissions of atmospheric pollutants.

The law sets out the mechanisms for:

• the creation of the National Inventory of greenhouse gas emissions and atmospheric pollutants (on an annual basis) and forecasts of atmospheric emissions (on a biennial basis) by the Spanish System of Inventories and Forecasts of Atmospheric Emissions;
•  the identification, monitoring and notification of policies and measures to reduce greenhouse gas emissions and other atmospheric pollutants, to promote carbon sinks, to adapt to climate change and to provide financial and technological support and training support to developing countries; and 
•  complying with the communication and information commitments undertaken by Spain before the United Nations Framework Convention on Climate Change, the European Commission and other international organisations.

Transparency

1. The European Commission publishes new guidelines on EU taxonomy and its delegated acts

Throughout the month of March, the European Commission has published two interesting guidelines relating to different aspects of Regulation (EU) 2020/852 that establishes a framework to facilitate sustainable investments (Taxonomy Regulation) and its delegated acts.

• On 25 March it published a technical guide (available at this link) regarding the implementation of the "do no significant harm" (DNSH) principle included in Article 17 of the Taxonomy Regulation within the framework of Regulation (EU) 2023/955 (Social Climate Fund Regulation). The guide aims to provide guidance to Member States on the implementation of this principle to ensure that measures and investments financed by the Social Climate Fund (Fund) meet this objective.

The guide establishes: (i) the common foundations for defining the DNSH principle, including the guiding principles that activities and assets must respect; (ii) different tools and approaches for the practical application of these common foundations; (iii) certain sector-specific appendices that establish criteria for a non-exhaustive list of activities and assets admissible within the scope of the Fund, (iv) the applicable DNSH assessment for activities and assets not included in the appendices; and (v) the specific conditions for financial products executed in the InvestEU Member State compartment market.

The Commission hopes that this technical guide will facilitate the preparation and implementation of the social climate plans by Member States and that it will contribute to the achievement of the objectives of the European Green Deal and the Sustainable Finance Action Plan.

• On 5 March, it published a new notice (available at this link) with technical clarifications provided in a question and answer format on the technical screening criteria (TSC) established in the EU taxonomy climate delegated act (Delegated Regulation (EU) 2021/2139) and in the EU taxonomy environmental delegated act, and on the information disclosure obligations with respect to non-climate environmental goals set out in the amendments to the EU taxonomy disclosures delegated act (Delegated Regulation (EU) 2021/2178).

The notice includes 155 frequently asked questions raised by stakeholders on TSCs of different sectors and economic activities, as well as on cross-cutting issues such as the DNSH principle, minimum safeguards or assessments of vulnerabilities and climate risks and addressing various issues such as, among others, the frequency of third-party verification of the disclosure of taxonomy-related information, whether the scope of environmental impact assessments extends to all activities included in the EU taxonomy and the deadline for disclosing eligibility under the taxonomy or the adaptation to it of the economic activities included in the EU taxonomy environmental delegated act and the amendments to the EU taxonomy climate delegated act.

2. The Clean Industrial Deal, a joint roadmap to boost the EU's competitiveness and decarbonisation

As announced by the European Commission last January in its Compass for Competitiveness, on 26 February, the Clean Industrial Deal was introduced, a joint roadmap to support the decarbonisation and competitiveness of the EU (available at this link).

The initiative contains a strategic plan that focuses its efforts on accelerating the decarbonisation and circularity of the European economy while strengthening and boosting the competitiveness and resilience of the industry in Europe. The plan sets the goal of making the EU the world leader on circular economy by 2030 and achieving climate neutrality by 2050. To this end, the plan focuses mainly on energy-intensive industries and the clean technology sector and presents measures that cover the entire value chain, distinguishing six strategic factors:

• Access to affordable energy: The EU faces high and volatile energy prices compared to its trading partners and competitors, which harms its competitiveness. The European Commission highlights the need to reduce energy costs and guarantee access to affordable clean energy, accelerating electrification and the transition to clean, domestically generated energy, completing an integrated and interconnected internal energy market and using energy more efficiently. For this purpose, an Action Plan for Affordable Energy is being adopted alongside this plan, which includes, among other things, measures to reduce the price of energy for industries, businesses and households, to reduce the cost of electricity supply and to ensure the proper functioning of gas markets.
• Leading markets in clean products: The plan aims to lay the foundations for the creation of leading markets in clean technologies and to increase the competitiveness of key clean sectors. Among other measures, the Commission will adopt the Industrial Decarbonisation Acceleration Act, which aims to increase demand for clean products manufactured in the EU by introducing sustainability and resilience criteria.
•  Investment in the clean transition: The plan envisages mobilising 100 million euros, adopting measures to: (i) reinforce funding at EU level, (ii) stimulate private investment; and (iii) facilitate the approval of state aid for decarbonisation and the manufacture of clean technologies.
• Circularity: The principle of circularity is one of the pillars of the decarbonisation strategy to guarantee access to raw materials and reduce dependence on unreliable suppliers. The Commission proposes to prioritise the implementation of the Critical Raw Materials Act, to create an EU Critical Raw Materials Centre and to adopt a Circular Economy Act in 2026.
• Global markets and international cooperation: The Commission emphasises the need to continue signing new Free Trade Agreements (FTAs) and implementing those that are pending, and plans to create the first Clean Trade and Investment Partnerships, which will complement FTAs with a more flexible and specific approach. It also announces that it will review the CBMA.
• Skilled labour: The plan includes support measures and the creation of a Skills Union to boost workers' access to skills required in the context of the clean and digital transition, attract talent and create new quality jobs.

Financial markets

1. Updated Green, Social and Sustainability-Linked Loan Principles for 2025

On 26 March, the Loan Market Association (LMA), in collaboration with the Asia Pacific Loan Market Association (APLMA) and the Loan Syndications and Trading Association (LSTA), published a new update of the Green, Social and Sustainability-Linked Loan Principles, as well as of the corresponding guidance accompanying each of these principles. These documents are available at this link.

The main changes introduced with this new update include the following:

• Regarding the Green, Social and Sustainability-Linked Loan Principles: 

(i) a new section on the interpretation of terms is included, allowing for a clearer differentiation between mandatory requirements, recommendations, options and possible courses of action. In addition, several matters previously considered recommendations are now considered mandatory requirements; and

(ii) the exemption that until now excluded those transactions completed or in progress at the time of publication of updated principles from carrying out its revision in accordance with such update. The exception instead foresaw its revision in accordance with the principles in force at the time of origin, extension or refinancing of the loan is eliminated. Therefore, it is possible that those transactions in progress at the time of publication of this new update shall be reviewed in accordance with the latest version of these principles.

• Regarding the Green and Social Loan Principles:

(i) amendments have been made to the Eligible Green Projects and Eligible Social Projects categories to adapt them to the latest market trends; and

(ii) it includes the definition of "Sustainable Loans" for loans that intentionally combine Eligible Green Projects and Eligible Social Projects.

• With regard to the Principles Related to Sustainability, changes, clarifications and considerations are introduced in relation to the Key Performance Indicators (KPIs) and the Sustainability Performance Targets (SPTs) that offer a clearer vision of the criteria for their selection.

2. CDP and EFRAG publish a correspondence mapping between the CDP question pool and the ESRS E1

On 18 March, CDP (the global independent disclosure system for companies to measure and manage their environmental impacts) and the European Financial Reporting Advisory Group (EFRAG) published a correspondence mapping (available at this link) showing the interoperability between the CDP question pool and the European Sustainability Reporting Standards on Climate Change (ESRS E1). In particular, it details the alignment in key areas such as transition plans for climate change mitigation, climate change mitigation targets, gross emissions from scopes 1, 2 and 3, and internal carbon pricing.

The initiative seeks to reduce complexity, improve efficiency and promote transparency in climate reporting, enabling companies to identify synergies in the data collected for CDP disclosures and ESRS E1 disclosure requirements.

The mapping identifies data that fully corresponds, data that entails additional requirements in the ESRS E1, data that differs in scope or semantics, and data excluded from the mapping because it corresponds to specific requirements of EU legislation or because it requires specific information on a particular sector in the ESRS E1.

3. ESMA publishes its final report on the Technical Standards on the European Green Bond Regulation

On 14 February, the European Securities and Markets Authority (ESMA) published its final report on the technical standards developed under the Green Bond Regulation (Regulation (EU) 2023/2631) for the external reviewers of these bonds. It is available at this link.

The final report includes the reviewed drafts of the regulatory technical standards (RTS) and the implementation technical standards (ITS) relating to the regime for external reviewers and takes into account the responses received to the public consultation carried out last year.

The RTS include criteria regarding the assessment of governance, prudential management and conflicts of interest, analysts and outsourcing. The ITS refer to standard forms, templates or procedures for the provision of registration information. The aim is that RTS and ITS shall apply to external reviewers registered with ESMA from 21 June 2026.

The final drafts have been submitted to the European Commission for approval via a Commission Delegated Regulation (for the RTS) and a Commission Implementing Regulation (for the ITS), subject to the non-objection period of the European Parliament and the Council.