The US is doubling down on its efforts to quash European environmental and human rights rules it says unfairly impact American companies.
The Trump administration “will take any actions necessary to address unreasonable burdens on US commerce” if the European Union doesn’t rein in its ESG regulations, according to a letter addressed to the EU by the US government.
The comments were accompanied by a post on X by US ambassador to the EU, Andrew Puzder, who said “it’s time for the EU to deliver” on what he described as an earlier commitment by the bloc to ensure American companies won’t face “undue restrictions” on trade.
The comments threaten to revive a standoff between the US and the EU over the Corporate Sustainability Reporting Directive and the Corporate Sustainability Due Diligence Directive. The frameworks have been watered down after pushback both from within and outside the EU. But they’re still intended to apply to companies that do business in the EU, no matter where they’re based.
A spokesperson for the European Commission didn’t immediately respond to a request for comment.
CSDDD and CSRD require that companies report the financial environmental, social and governance risks they may face, and that they also disclose and remediate their environmental and social impact.
In its letter to the EU, the US government noted that Brussels had made “some positive reforms,” but said those “failed to fully address US concerns.” As a result of the directives’ extraterritorial reach and costs, US businesses won’t be able to compete in Europe on a level playing field, according to the letter.
The EU is currently drawing up guidelines for complying with the due diligence directive. The US also warned the bloc against using guidelines as an opportunity to reintroduce climate transition plan requirements.
Photo: European Union flags. Photographer: Simon Wohlfahrt/Bloomberg
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