The conflict involves two key elements of the European Union’s corporate sustainability framework: the Corporate Sustainability Due Diligence Directive, which mandates large corporations to address human rights and environmental issues associated with their activities and supply chains, and the Corporate Sustainability Reporting Directive, which obliges businesses to report sustainability-related information.
The EU has reduced both regulations in an effort to minimize bureaucracy but has resisted Washington’s plea to exempt U.S. companies from these laws.
Recently, Puzder similarly criticized the EU’s Carbon Border Adjustment Mechanism, labeling it a tariff on U.S. goods. Furthermore, the White House accused the EU and over 40 nations of allowing Chinese products to bypass U.S. tariffs by re-exporting them through their markets.
A European Commission representative told POLITICO that Brussels had exerted “considerable efforts” to clarify its regulations and express “its readiness to collaborate with the U.S. to enhance trade where feasible.” However, Brussels is firm on not altering its regulatory system due to U.S. pressure.
“We have been very clear and consistent that neither our regulatory framework nor our autonomy are negotiable,” the spokesperson stated.
This article has been updated.
Reporting contributions by Koen Verhelst.
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