European Commission Opens Consultation on CS3D Implementation Guidelines

Introduction

On 12 June 2026, the European Commission (Commission) launched a public consultation on guidelines for the implementation of the Corporate Sustainability Due Diligence Directive (CS3D).

The consultation is a significant opportunity for businesses to influence how CS3D’s requirements will operate in practice. The consultation is relevant not only to companies falling directly within the scope of CS3D but also to suppliers, customers, joint-venture partners, industry associations, financial institutions, professional advisers, and other stakeholders that may be affected by the due-diligence processes of in-scope companies. 

CS3D Scope Following Omnibus I Amendments

The CS3D originally entered into force on 25 July 2024. It has since been amended twice under the Omnibus I simplification package. The first amendment—the so-called “stop-the-clock” measure—entered into force on 17 April 2025 and postponed certain CS3D implementation and application deadlines without altering any substantive obligations. The second set of amendments brought forward more far-reaching changes, most notably a significant reduction in the number of companies falling within the CS3D’s scope, the removal of the requirement for companies to adopt a climate-change mitigation transition plan, a maximum cap for pecuniary penalties of 3% of a company’s net worldwide turnover, and an introduction of a more targeted risk-based approach to value-chain due diligence, including safeguards intended to limit disproportionate information requests to smaller business partners. This second set of changes entered into force on 18 March 2026. 

Following these amendments, the CS3D will apply directly to the following:

• EU companies with at least 5,000 employees and net worldwide turnover of at least €1.5 billion, including relevant ultimate parent companies on a consolidated basis.
• Non-EU companies with net turnover of at least €1.5 billion in the European Union, including relevant ultimate parent companies on a consolidated basis.
• Certain companies operating under franchising or licensing models where the applicable thresholds are met.

In-scope companies will need to assess actual and potential adverse human rights and environmental impacts in their own operations, those of their subsidiaries, and their chains of activities. This will affect commercial relationships with companies that are not directly subject to CS3D, including smaller suppliers and other value-chain partners.

Member states must adopt and publish the relevant national transposition measures by 26 July 2028. The amended CS3D requirements will apply to all companies from 26 July 2029, except for the reporting measures under Article 16, which will apply for financial years starting on or after 1 January 2030.

We previously reported on the Omnibus I amendments in this client alert. 

Key Elements of the Consultation

The consultation covers a broad range of issues affecting the practical implementation of CS3D. In particular, the Commission is seeking input on the following:

• Risk-Based Due Diligence: How companies should integrate due diligence into their policies and risk-management systems, identify and prioritize adverse impacts, access relevant data, and use digital tools and external service providers.

• Value-Chain Relationships: How companies should engage with direct and indirect business partners, manage information requests, adapt purchasing practices, and provide proportionate support to small and medium enterprises.

• Contractual Arrangements: How voluntary model contractual clauses should allocate responsibilities, costs, audit rights, corrective-action measures, and termination rights without shifting disproportionate burdens to business partners.

• Higher-Risk Operating Environments: How companies should address due diligence challenges in conflict-affected and high-risk areas, including limited data availability, safety concerns, legal constraints, and opaque supply chains.

• Collaboration and Verification: How companies may share information, use industry initiatives and third-party verification mechanisms, and address trade-secret, competition-law, and audit concerns.

• Stakeholder Engagement: How companies should engage with workers, affected communities, and vulnerable stakeholders, including through complaint mechanisms and safeguards against retaliation.

• Supervision and Enforcement: How national authorities should coordinate their oversight activities and approach penalties.

The consultation is particularly relevant for companies that expect CS3D to affect their supply-chain management, contractual practices, data systems, and relationships with business partners. Businesses may wish to use the consultation to highlight sector-specific concerns, propose proportionate compliance solutions, and identify areas where further guidance could reduce duplication, legal uncertainty, and unnecessary burdens across value chains.

Next Steps

The consultation runs until 24 July 2026. 

Legally, the guidelines will not create independently enforceable obligations. The binding requirements will arise from the legal text of CS3D as implemented through national law. Nevertheless, the Commission’s guidance is expected to become an important practical tool for companies, supervisory authorities, and other stakeholders when interpreting and applying CS3D requirements.

The present consultation is intended to inform a broad package of Commission guidance to be published in the following stages:

• By 26 July 2027, the Commission is expected to publish:
  • Guidance on voluntary model contractual clauses, intended to support companies when seeking contractual assurances from business partners while avoiding an inappropriate transfer of CS3D obligations or compliance burdens to those partners.
  • A first package of general guidelines covering the following:
    • Practical guidance and best practices on the due-diligence obligations set out in Articles 5 to 16 CS3D, including risk identification, prioritization, purchasing practices, responsible disengagement, remediation, and stakeholder engagement.
    • The assessment of company-level, operational, geographical, contextual, product, service, and sectoral risk factors, including risks associated with conflict-affected and high-risk areas.
    • References to relevant data and information sources, digital tools, and technologies that may facilitate compliance.
• By 26 July 2028, the Commission is expected to publish additional guidelines covering the following:
  • The sharing of resources and information among companies and other legal entities, including the protection of trade secrets and safeguards against retaliation.
  • Information for stakeholders and their representatives on how to engage throughout the due-diligence process.
• Sector-specific guidelines are also contemplated by Article 19 CS3D, although CS3D does not set a fixed publication deadline.

We are available to assist clients in understanding the CS3D obligations, assessing the potential impact of the future guidelines, identifying the most relevant consultation areas, coordinating internal input, and preparing tailored submissions to the consultation.