EU Council Enacts Legislation to Temporarily Pause Compliance with Duty-of-Care Regulations for Batteries
The European Union (EU) has taken a significant step towards easing the implementation challenges faced by battery producers with the adoption of the Omnibus IV package. This regulatory simplification initiative, aimed at various sectors, formally postpones due diligence obligations for battery manufacturers until August 18, 2027 [1][2][3].
The postponement, which responds to practical difficulties such as the slow designation of third-party verification bodies and the delay in finalizing recognized due diligence schemes, offers more time for the setting up of these bodies [1][2]. Despite the delay, the extension is not a grace period for inaction. Companies placing batteries on the EU market must have fully implemented and independently verified due diligence systems by the 2027 deadline [1][2].
These systems involve risk identification, mitigation, and traceability throughout the raw materials supply chain—particularly for cobalt, lithium, graphite, and nickel. The systems must be verified by notified third-party bodies, ensuring compliance and transparency [1][2].
Key details of the new law include the delay of the European Commission’s guidelines on due diligence obligations to July 26, 2026, impacting practical implementation timelines [3]. Additionally, an increase in the turnover threshold for exemption means that companies/groups earning less than €150 million may be exempt from due diligence and supply chain tracing (previously €40 million) [3]. Reporting on due diligence will occur starting one year after the obligation applies and then every three years, replacing the previous annual requirement [3].
EU leaders urged co-legislators to prioritize the Omnibus simplification packages with a high level of ambition in March 2025. The Omnibus IV package includes proposals for a directive and regulation on mid-caps, simplification of data protection obligations for Small and Medium-sized Enterprises (SMEs) and Small and Medium-sized Companies (SMCs), and digitalization and alignment of common specifications for 20 pieces of EU product legislation [4].
The new regulation is part of the 'Omnibus IV' package, which also aims to provide a clear, simple, and smart regulatory framework for businesses, as called for in the Budapest declaration of 8 November 2024. The European Council has called on all EU institutions, member states, and stakeholders to prioritize work, in response to reports by Enrico Letta and Mario Draghi [5].
It's important to note that the Omnibus IV package does not directly relate to the previous facts about battery due diligence rules, as it focuses on various other aspects such as mid-caps, SMEs, SMCs, and digitalization. However, it does provide additional time for battery makers and exporters to comply with these new environmental due diligence rules.
Producers are also required to publicly report on their due diligence practices, ensuring transparency and accountability in the battery industry. This reporting will help the EU maintain robust due diligence standards while easing compliance burdens for battery producers.
The postponement of due diligence obligations for battery manufacturers in the Omnibus IV package allows for more time in setting up third-party verification bodies, which are essential for implementing and independently verifying due diligence systems in the environmental-science field. As science and technology play crucial roles in the battery industry, especially in the raw materials supply chain, this extension does not signify a license for inaction but a chance for companies to match the requirements in technology and environmental-science aspects by the 2027 deadline.
