Explanation of Article 48i of Directive 2013/34/EU
Article 48i of Directive 2013/34/EU (the Accounting Directive, as amended by the CSRD) contains transitional provisions for the preparation of a consolidated sustainability report by subsidiaries of third-country parent undertakings.
A company prepares the consolidated sustainability report pursuant to Article 48i if the following criteria are met:
It is a subsidiary of a parent undertaking established in a third country (outside the EU).
The parent undertaking in the third country prepares a consolidated sustainability report covering all subsidiaries within the Union that complies with the requirements of the CSRD.
The subsidiary in the EU discloses this report (and the assurance opinion of an auditor) in accordance with national law.
In this case, the subsidiary is exempt from its own obligation to prepare a separate consolidated sustainability report (unless it is a very large, listed company that is explicitly excluded from this specific exemption).
Thus, Article 48i itself serves as the legal basis for a potential exemption—not as the general obligation to report. The general obligations to prepare a consolidated sustainability report for large, EU-based groups primarily arise from Article 29a of Directive 2013/34/EU.
Objective:
The purpose of this approach is to streamline reporting obligations within the EU. Other EU subsidiaries involved can then make use of the exemption (under Articles 19a(9) and 29a(8)) and are no longer required to prepare their own separate reports.
Link to the Directive: