When the Directive on corporate sustainability due diligence (CS3D) was first proposed, it seemed to promise a turning point in Europe’s approach to corporate accountability and the right to remedy. Although political negotiation watered down its initial ambitions by limiting its application to the largest companies and removing director oversight duties, the CS3D, which became law on July 25, 2024, still required the creation of a harmonized civil liability standard, enabling victims across Member States and beyond to seek judicial remedies when companies failed to adequately conduct human rights and environmental due diligence. In an article on this site, Paula Alejandra Camargo Páez argued that “the CS3D marks an opportunity . . . to leverage human rights and climate litigation as powerful tools to hold private actors accountable for the harms caused by their business operations and those within their value chains.”
Recent events in Europe threaten this opportunity. After months of concern over “excessive regulatory burden,” the European Commission announced its Omnibus Legislative Package on February 26, 2025, proposing sweeping amendments to the European Green Deal laws, including the CS3D. Among its most consequential revisions is the removal of an EU-wide civil liability requirement. In its place, each Member State would decide whether to establish liability mechanisms and how to do so, creating a fragmented patchwork of national rules. This approach has historically proven inadequate in cross-border human rights cases. For example, a Swedish mining company subcontracted the export of toxic waste to Arica, Chile, in the 1980s, leading to severe illness in the community that lived nearby. However, a Swedish court dismissed the claims as time-barred under Swedish law, which meant that the claimants (victims) were required to pay 3.2 million euros in legal fees. A group of UN experts argued this decision amounted to a “denial of environmental justice, in breach of the right to a fair trial.”
Why civil liability matters for the right to remedy
Civil liability operates within an ecosystem of remedy, which, as per the UN Guiding Principles on Business and Human Rights (UNGPs), includes judicial mechanisms, state-based non-judicial processes, and corporate-led operational-level grievance mechanisms (OGMs). A harmonized civil liability standard brings two critical benefits. First, it could incentivize companies to invest in robust human rights due diligence (HRDD) because failing to prevent abuses could lead to lawsuits with potentially significant damages. Further, robust HRDD could be used as a defense against potential claims. Second, it simplifies cross-border litigation by removing the need to rely on inconsistent national laws, which generally do not recognize a parent company’s legal responsibility for abuses buried deep in its supply chain (although there are notable exceptions).
In theory, the European Commission’s proposal still guarantees victims “effective access to justice” through each Member State’s national courts. But in practice, existing laws often present major hurdles. Some jurisdictions, like France, enable victims to sue companies that fail to implement adequate risk-management plans. Others, such as Germany, rely mostly on administrative fines without creating a new path to civil damages. Victims bringing claims in less protective jurisdictions face short time limits, high evidentiary barriers, and limited collective-action rights. This patchwork can leave those harmed by corporate abuse facing an uphill battle to secure compensation or injunctive relief, especially when multinational operations span multiple countries.
Indeed, the KiK case in Germany—involving a Pakistani factory fire that killed over 250 people—serves as a disturbing example. Despite a court accepting jurisdiction, the claim was eventually dismissed due to short limitation periods under Pakistani law. In such situations, the absence of an EU-wide liability regime means that companies can argue that the laws of the country where the harm took place should govern, often undermining a victim’s chance to obtain a fair remedy. As argued by the European Coalition for Corporate Justice (ECCJ), these procedural and jurisdictional barriers demonstrate why victims need a uniform approach, rather than being left at the mercy of whichever national laws happen to govern their case. This reality means that successful transnational litigation remains the exception: even in Europe’s most progressive courts, cases often drag on for years and, according to the ECCJ, rarely result in a judgment based on the merits of the case. Removing the CS3D’s uniform liability provisions continues this status quo, leaving many victims unable to secure meaningful remedies or justice through the courts.
The role of OGMs
Intentionally or not, removing a harmonized civil liability route through the revised CS3D places increased importance on OGMs. Under both the CS3D and the UNGPs, companies must establish or participate in OGMs to provide an effective remedy to victims of adverse human rights impacts (see, for example, the creation of an OGM in response to Germany’s Supply Chain Due Diligence Act). In this way, OGMs are intended as frontline tools for handling complaints without resorting to courts. When properly designed, they can offer prompt, culturally sensitive resolutions that include compensation, restitution, or corrective measures to prevent further harm. They also serve as critical risk identification and feedback systems for companies to identify and resolve systemic problems early, thus reducing both harm to affected communities and reputational risks for businesses.
However, OGMs work best when they complement, rather than replace, the threat of formal litigation. Without a legal backstop, some businesses may introduce token grievance processes that fail to deliver meaningful redress, particularly in severe or cross-border cases. The right to an effective remedy, which encompasses restitution, compensation, rehabilitation, and guarantees of non-recurrence, demands robust judicial and non-judicial pathways. The effectiveness of OGMs hinges on genuine corporate will, sufficient resources, and robust oversight. Where companies have little fear of court enforcement, they may opt for lower-cost, “tick-the-box” compliance instead.
A fork in the road
As EU Member States debate the future of due diligence and remedy via the Omnibus proposal, they face a choice. On the one hand, rolling back civil liability could reduce burdens on businesses. On the other hand, it risks abandoning communities and workers who rely on legal remedies when non-judicial channels fall short. While OGMs can offer a measure of relief, their success depends on credible judicial accountability.
Ultimately, the CS3D’s ability to reshape corporate behavior hinges on the interplay of incentives and deterrents. If Europe truly wants to be a leader in responsible business conduct, it should preserve—not remove—its harmonized civil liability core. A consistent liability framework rewards companies that prioritize ethics and sustainability, levels the playing field for all businesses, and provides a reliable path to justice for victims, particularly those who are not in Europe. Indeed, ensuring a genuine right to remedy requires multiple layers of protection: accessible grievance mechanisms, supportive administrative oversight, and, crucially, a harmonized civil liability standard that keeps the “ecosystem of remedy” in balance.