Recital (31)

It is important to ensure legal certainty regarding the reduction in the scope of undertakings subject to sustainability reporting requirements, especially regarding the personal scope of the relevant provisions at each point in time. Accordingly, Article 5(2), first subparagraph, point (a), of Directive (EU) 2022/2464, which concerns the first set of undertakings subject to that Directive, should be amended to limit its application to three financial years from 1 January 2024. For financial years starting on or after 1 January 2027, Article 5(2), first subparagraph, point (b), of Directive (EU) 2022/2464, which concerns the second set of undertakings subject to that Directive, should apply. Accordingly, undertakings that fall within the scope of Article 5(2), first subparagraph, point (a), of that Directive but outside the scope of point (b) thereof, as amended by this Directive, will fall outside the scope of this Directive as of financial years starting on or after 1 January 2027. Nevertheless, with a view to reducing burden as swiftly as possible, Member States should be able to exempt such undertakings from reporting obligations as regards the financial years beginning between 1 January 2025 and 31 December 2026. Member States are required to implement that derogation in a way that ensures compliance with the principle of legal certainty.