The penalty ceiling

What is the requirement, in plain English?

The Commission, with Member States, issues guidance on setting penalties. Member States must set the ceiling for pecuniary penalties at 3 per cent of the company's net worldwide turnover in the financial year before the decision, or, for an ultimate parent company caught by the relevant limbs of Article 2, 3 per cent of the group's consolidated worldwide turnover, worked out at that ultimate parent in the year before the decision.

What evidence does a regulator or an auditor ask for?

The penalty exposure note: the turnover base, the group level the calculation uses and the year the calculation fixes on.

Which dates matter?

• Transposition of Article 4 (due diligence amendments): 26 July 2028

The transposition deadline for Articles 1 to 3 of the amending directive is 19 March 2027 (Article 5). For Article 4 it is 26 July 2028, applied from 26 July 2029.

What does it cross-reference?

• (EU) 2024/1760 Article 2(1), points (b) and (c), and Article 2(2), points (b) and (c)

How do I check a draft against this provision?

Paste your draft into the reading. The reading returns, per provision, whether a phrase specific to this requirement appears in your own words, quoted, with the article cited here. Where a line reaches nothing it reads no mapping identified.

Not legal advice; does not certify. Every field on this page carries its own source pointer, and the record is replayed by the pages, the check and the export from one reviewed record.