It depends on the financial year, the entity and two figures. For a year starting on or after 1 January 2027, the company must exceed both EUR 450 million net turnover and 1,000 average employees. For 2024 to 2026, a different transitional test applies. The free check returns the answer with the article.
There is no single yes or no. The directive sets a transitional population for financial years 2024 to 2026 and a new population for financial years starting on or after 1 January 2027. A company can be in scope for 2025, exempted by its Member State for 2026 and out of scope for 2027, or the reverse. The only safe answer is a row per financial year, with the entity, the two figures, the public-interest status and the national option recorded.
Which entity do I test?
Test the entity that prepares the management report. An individual undertaking tests its own figures under Article 19a. A parent tests the group on a consolidated basis under Article 29a. A subsidiary may be exempt if its information is included in a parent's consolidated report, and the exemption now covers public-interest entities. An EU subsidiary or branch of a non-EU group has a separate route under Article 40a, with a EUR 200 million subsidiary or branch figure and a EUR 450 million Union group figure for each of the last two years.
What if we are a public-interest entity?
For 2024 the population is public-interest entities above 500 employees. For 2025 and 2026 the same population applies unless the Member State has used the exemption for companies below either EUR 450 million or 1,000 employees. From 2027 the public-interest status no longer defines the population; the two figures do.
What evidence should we keep?
A scoping memo with the turnover figure, the average headcount, the balance sheet date, the source of each figure and the consolidation perimeter. A board or audit committee minute approving the conclusion. The national transposition measure, if an option is relied on. And a note of the year-by-year answer, because the question will be asked again next year.
We have subsidiaries across Europe and North America. How do we consolidate?
Start with the financial consolidation perimeter. The sustainability statement follows the group's consolidated management report, so the entities in the financial perimeter are the starting point. Then apply the value chain cap to requests outside the perimeter. A supplier request that exceeds the voluntary standards for an undertaking with no more than 1,000 employees is not permitted, and the request must say so.
We are below the threshold. Do we have to do anything?
Not under Article 19a for that year. You may still have a customer that asks for value chain information, and the cap and the right to decline apply to that request. You may also be in the CSDDD scope on a different test. The free check reports the CSDDD flag separately.
Where this comes from
The article record states each requirement in our own words and cites the article. The free check returns the year-by-year scope answer. The official text is Directive (EU) 2026/470.
Not legal advice; does not certify. The national transposing measure controls the route and any option it uses.