EU Taxonomy Overhaul: Commission publishes draft revisions to Climate and Environmental Delegated Acts

23 March 2026

On Tuesday, 17 March 2026, the European Commission published draft amendments to the Climate Delegated Act (CDA) and the Environmental Delegated Act (EDA) setting out the criteria for alignment with the six environmental objectives of the Taxonomy Regulation. These revisions form a central component of the Commission’s broader simplification agenda for the Sustainable Finance framework.

Background: Omnibus I, the Call for Evidence, and the Platform recommendations

The proposed amendments are a result of the extensive Call for Evidence conducted by the Commission from November to December 2025 which placed particular emphasis on usability, simplification and legal clarity of the technical screening criteria (TSC) to ease the reporting burden and lower compliance costs for companies. They also build on the Platform on Sustainable Finance’s recommendations on how to simplify the Climate Delegated Act and the EU Taxonomy framework (see our blogpost on these recommendations here). They follow a smaller-scale revision of the CDA and EDA in the context of the Omnibus I changes to Taxonomy reporting which has recently come into force on 28 January 2026 (see our blogpost here).

The current review focuses on a core concern raised repeatedly since the introduction of the Taxonomy framework in 2020/2021: that the TSC used to assess economic activities against the Taxonomy objectives are overly complex, duplicative, and operationally difficult to apply. This applies in particular to the TSC for the "Do No Significant Harm" (DNSH) component of the Taxonomy assessment, which ensures that activities positively contributing to one Taxonomy objective do not harm other Taxonomy objectives. The Commission’s expressed aim is to "boost taxonomy adoption through easier use, improve access to green finance in the EU, and enhance market transparency through clearer disclosures".

Content of the draft amendments: Four key areas

The Draft Amendments fill hundreds of pages and introduce a wide set of technical amendments, within the following four key areas:

Heike Schmitz

Partner, Germany

Shantanu Naravane

Partner, London

Leonie Timmers

Of Counsel, Madrid

Jan Labusga

Associate, Germany

Joanna Pecenik Vergès d’Espagne

Partner, Luxembourg and Paris

The DNSH criteria for the Taxonomy objective climate change adaptation are the most widely used TSC across CDA and EDA. The Commission proposes to reorganise them into four consecutive steps that build on each other as follows:

Step 1: Screening

All activities must be screened to identify whether certain pre-defined climate-related hazards may significantly impact the activity's performance during the expected lifetime.

Step 2: Climate Risk Assessment

If the screening has identified a potential significant impact, the climate risk must be assessed in detail using climatic weather data or projections aligned with the expected lifespan.

Step 3: Adaptation Plan

For climate risks assessed in Step 2, possible adaptation solutions reducing these risks must be assessed and explained in an adaptation plan.

Step 4: Implementation:

If the activity is new or involves newly-built physical assets, the selected adaptation solutions must be implemented before the start of operations. Existing activities and assets do not have such strict implementation requirements.

The Commission's text also adds updated references to climate data sources and risk assessment tools. In addition, a practical “bridge” to finance is included: a financial institution may treat financing as DNSH aligned if the financing contract contains a legally binding condition requiring the operator to meet the adaptation DNSH criteria before starting the financed activity.

These DNSH criteria are also widely used across CDA and EDA. The Commission proposes introducing a "ladder" of evidence for demonstrating compliance with the European Union's legal framework for water and marine resources (Directive 2000/60/EC (Water Framework Directive) and Directive 2008/56/EC (Marine Strategy Framework Directive)) as follows:

Primarily, by conducting an Environmental Impact Assessment (EIA) including an assessment of the impact on water;
Where an EIA is not required, by relying on valid and up‑to‑date environmental permits covering water aspects; or
Where neither EIA nor a permit are required, providing alternative evidence such as registrations or notifications to competent authorities.

By introducing several options, this addresses recurring complaints that DNSH is hard to evidence and not sufficiently aligned to existing compliance processes.

These DNSH criteria used across CDA and EDA have already been amended by delegated act amending the EU Taxonomy framework as part of the Omnibus I package which entered into force on 28 January 2026. Now the Commission proposes further clarifications relating to naturally occurring substances and references to EU legislation. The temporary mobilisation of naturally occurring substances is not considered pollution, as long as it is unavoidable, releases are limited and the substances are handled and returned according to EU law and relevant best available techniques. The Commission text also incorporates recent legislative updates to EU legislation and provides more precise references to EU legislation (regulating POPs, mercury, ozone depleting substances, RoHS substances and REACH substances).

Based on insights gained from two years of Taxonomy reporting and to align the criteria with newer EU legislation, the Commission also proposes changes to the activity descriptions used for the eligibility assessment and the TSC to assess whether an activity significantly contributes to a Taxonomy objective. These proposed changes fill hundreds of pages, hence we can only mention a few examples:

Some activity descriptions relating to water supply, wastewater treatment, waste management and plastic packaging in the EDA are rewritten for clarity and to reflect legislation such as Directive (EU) 2024/3019 (urban wastewater), Regulation (EU) 2024/1781 (ecodesign for sustainable products) and Regulation (EU) 2025/40 (packaging and packaging waste);
Activities relating to the collection, transport and treatment of "hazardous waste" under the EDA will be made subject to more detailed activity descriptions and DNSH criteria;
For a range of activities under the CDA, the approach to calculating life cycle greenhouse gas (GHG) emissions and the references to be used for are clarified;For a range of forestry-related activities in the CDA, activity descriptions are enhanced and TSC are loosened, for example by pushing back the deadline by which audits need to be conducted.

Next Steps: Consultation and adoption timeline

The Commission has opened a public feedback period from 17 March 2026 to 14 April 2026. During this window, stakeholders - including corporates, financial institutions, industry associations, and NGOs - may submit observations on the proposed amendments.

Following the close of the feedback period:

The Commission aims to finalise and adopt the revisions to CDA and EDA in Q2 2026, consistent with the timing indicated in the Call for Evidence; and
Once adopted, the revising acts will undergo the standard scrutiny period of 4 months by the European Parliament and Council prior to entry into force. This scrutiny period can be extended to up to 6 months.

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