EU carbon rules / Regulations / EU Taxonomy
In force Regulation Sustainability reporting & due diligence
EU Taxonomy
Defines environmental objectives for sustainable economic activities and aligned disclosure rules (scope of reporting entities narrowed by Omnibus I Directive 2026/470)
- Reference
- Regulation (EU) 2020/852 + DA (EU) 2021/2139
- Key date
- 2020
- Applies to
- Financial market participants, large companies
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Who the regulation applies to
This regulation applies to:
- Member States and the EU: must apply the classification criteria of this Regulation when setting requirements, standards or labels for financial products or corporate bonds marketed as environmentally sustainable
- Financial market participants offering financial products (as defined in Article 2(1) of Regulation (EU) 2019/2088)
- Undertakings subject to non-financial reporting obligations under Article 19a or 29a of Directive 2013/34/EU (must disclose information related to the classification criteria); the scope of those undertakings was narrowed by Directive (EU) 2026/470 to those with net turnover exceeding EUR 450 000 000 and more than 1 000 average employees
The references to Articles 19a and 29a in Article 8(1) are to the corresponding provisions of Directive 2013/34/EU (first amended by Directive (EU) 2022/2464, whose scope was subsequently narrowed by Directive (EU) 2026/470).
The following provisions define its scope:
Article 1 — Subject matter and scope
1. This Regulation establishes the criteria for determining whether an economic activity qualifies as environmentally sustainable for the purposes of establishing the degree to which an investment is environmentally sustainable.
2. This Regulation applies to:
(a)
measures adopted by Member States or by the Union that set out requirements for financial market participants or issuers in respect of financial products or corporate bonds that are made available as environmentally sustainable;
(b)
financial market participants that make available financial products;
(c)
undertakings which are subject to the obligation to publish a non-financial statement or a consolidated non-financial statement pursuant to Article 19a or Article 29a of Directive 2013/34/EU of the European Parliament and of the Council (68), respectively.
Article 4 — Use of the criteria for environmentally sustainable economic activities in public measures, in standards and in labels
Member States and the Union shall apply the criteria set out in Article 3 to determine whether an economic activity qualifies as environmentally sustainable for the purposes of any measure setting out requirements for financial market participants or issuers in respect of financial products or corporate bonds that are made available as environmentally sustainable.
Article 8(1) — Transparency of undertakings in non-financial statements
1. Any undertaking which is subject to an obligation to publish non-financial information pursuant to Article 19a or Article 29a of Directive 2013/34/EU shall include in its non-financial statement or consolidated non-financial statement information on how and to what extent the undertaking’s activities are associated with economic activities that qualify as environmentally sustainable under Articles 3 and 9 of this Regulation.
02
What the regulation requires
| Duty | Trigger | Evidence | Timing |
Determine the environmental characteristics of activities under the Taxonomy
Determine whether an economic activity substantially contributes to climate mitigation/adaptation and does no significant harm. | Entities subject to CSRD/financial market rules | Taxonomy-aligned disclosure (share of turnover, CapEx, OpEx) | Annual reporting |
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Key provisions
Article 3 — Environmental objectives
For the purposes of determining the degree to which an investment is environmentally sustainable, an economic activity shall qualify as environmentally sustainable where that economic activity: (a) contributes substantially to one or more of the environmental objectives set out in Article 9 ...; (b) does not significantly harm any of the environmental objectives ...; (c) is carried out in compliance with the minimum safeguards ...; and (d) complies with technical screening criteria ...
Article 8(1) — Transparency in non-financial statements
Any undertaking which is subject to an obligation to publish non-financial information ... shall include in its non-financial statement or consolidated non-financial statement information on how and to what extent the undertaking's activities are associated with economic activities that qualify as environmentally sustainable ...
Article 8(2) — Content and format
In particular, undertakings shall disclose ... (a) the proportion of their turnover derived from products or services associated with economic activities that qualify as environmentally sustainable ...; and (b) the proportion of their capital expenditure (CapEx) and the proportion of their operating expenditure (OpEx) related to assets or processes associated with economic activities that qualify as environmentally sustainable ...
Article 9 — Environmental objectives (list)
The environmental objectives referred to in point (a) of Article 3 are: (a) climate change mitigation; (b) climate change adaptation; (c) the sustainable use and protection of water and marine resources; (d) the transition to a circular economy; (e) pollution prevention and control; and (f) the protection and restoration of biodiversity and ecosystems.
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Industry dossiers covering this regulation