Brussels Just Removed 80% of Companies From the PHEV Fleet Rule Everyone Warned About

The compliance warning most fleet managers heard is already out of date

Through 2025, Italian corporate fleet advisors routinely warned that plug-in hybrids operated in charge-sustaining mode, burning petrol rather than running on stored charge, created a specific sustainability-reporting risk: Corporate Sustainability Reporting Directive (CSRD) rules were expected to require Scope 1 emissions disclosure from any company meeting two of three modest thresholds, roughly 250 employees, EUR50 million turnover, or EUR25 million in total assets. Under that original 2022 framework, a large share of Italy's mid-size corporate fleet operators running PHEVs would have qualified.

That framework no longer applies. Directive (EU) 2026/470, the legal instrument implementing the European Union's Omnibus I simplification package, was published in the EU Official Journal on 26 February 2026 and entered into force on 18 March 2026. It raised the CSRD threshold to a cumulative test: more than 1,000 employees and more than EUR450 million in annual net turnover. According to figures cited during the reform's approval process, that change removed approximately 80% of the companies previously expected to fall inside the reporting perimeter.

The result is that roughly 80% of companies originally expected to be in scope are now outside the mandatory reporting perimeter.

— Marqstats Research, summarizing the Omnibus I threshold change

The compliance risk did not disappear. It moved.

A mid-size Italian company running a PHEV fleet of a few hundred vehicles, with turnover well under EUR450 million, is almost certainly outside direct CSRD scope under the revised thresholds. That removes the specific legal reporting obligation. It does not remove every related pressure: the reform explicitly preserves what Italian ESG advisors call the effetto cascata, or cascade effect, in which a large, CSRD-obligated customer or parent company requests emissions data from smaller suppliers in its value chain, even though those suppliers carry no independent statutory duty to report it.

For a mid-size fleet operator supplying a large, CSRD-obligated automotive OEM, logistics group, or financial institution, unmanaged PHEV charge-sustaining behavior can still surface as a data request from that customer, backed by commercial rather than regulatory leverage. The risk has shifted from statutory penalty to commercial relationship management, which is a materially different problem to solve and a different one to communicate to a board.

What actually changed, in numbers

The original 2022 CSRD framework applied to companies meeting at least two of three criteria: more than 250 employees, turnover above EUR50 million, or total assets above EUR25 million. The revised framework replaces this with a single cumulative test requiring both more than 1,000 employees and more than EUR450 million in turnover. The employee threshold roughly quadrupled; the turnover threshold rose ninefold. Companies previously in what practitioners called wave 2, large non-listed companies expecting to publish their first sustainability report in 2026, mostly fall out of scope entirely unless they independently clear the new, much higher bar; those that remain in scope resume reporting from financial year 2027.

Listed small and medium enterprises, previously known as wave 3, are removed from the mandatory framework entirely and shift to a voluntary, lighter-weight standard. For most of Italy's PHEV-operating corporate fleets, which sit well under both the old and new employee thresholds individually but were closer to the old turnover threshold, the practical effect is straightforward: a compliance risk that was plausible under the 2022 rules is no longer plausible under the 2026 rules, for the great majority of fleet operators this size.

Is this reform actually good news for fleet decarbonization?

The reasonable objection is that a large threshold increase is itself a mild negative signal for emissions transparency: fewer companies with a legal obligation to disclose Scope 1 fleet emissions plausibly means less pressure to manage PHEV charge-sustaining behavior, all else equal, since the removed statutory requirement was one of the concrete reasons a fleet manager might have prioritized a charging-monitoring investment over other budget items.

That is a fair reading of the regulatory mechanics, but it assumes the original CSRD threshold was the primary driver of fleet-level charging behavior change in the first place, which this report's own analysis of Italy's PHEV market does not fully support. The 2025 fringe-benefit tax reform, not sustainability disclosure risk, is the dated, traceable cause behind Italy's PHEV registration rebound and the fleet channel's dominant 56.4% share of volume. A statutory reporting requirement that few fleet operators were close to triggering in practice was never likely to be the primary lever moving day-to-day charging behavior; the fiscal incentive to hold PHEVs in the fleet at all was always doing more of that work.

Companies close to the thresholds should monitor their financial data carefully, because a small shift in turnover or employee count can change the year they first become subject to reporting.

— Summary of Omnibus I guidance for companies approaching the revised CSRD thresholds

• Check whether your company independently clears both the 1,000-employee and EUR450 million turnover thresholds, not either one alone.
• If you supply a large, CSRD-obligated customer, expect data requests through the cascade effect even without a direct statutory obligation.
• Companies previously in wave 2 resume mandatory reporting from financial year 2027 only if they clear the new, higher thresholds.