What does the EU Nature Restoration Law mean for businesses?

In August 2024, the EU Nature Restoration Law (Regulation (EU) 2024/1991 of the European Parliament and of the Council of 24 June 2024 on nature restoration and amending Regulation (EU) 2022/869) entered into force. This regulation was adopted after a contentious process marked by initial opposition in European Parliament committees, a narrow approval in the Parliament’s plenary vote, and last-minute changes from Member States before finally securing the necessary majority in the Council of the EU.

Now that the dust has settled, it’s time to look ahead and focus on what the law in question entails in practice. In this article, Expert Support Services Manager Jenny Vuorenlinna has delved into the details of the Regulation to bring clarity and answer the following questions:

• What does the Regulation aim to achieve?
• Do companies need to worry about its impact?
• Is protecting nature and biodiversity primarily a concern at the state level?

Nature and biodiversity are under threat

Research and reports show that the state of nature and biodiversity is under threat, with the decline of natural habitats and species continuing across the European Union. Meanwhile, society is becoming increasingly aware of the importance of nature and biodiversity for people and the planet, as well as for fighting, mitigating and adapting to climate change. Of course, the risks related to biodiversity loss also affects businesses, as most companies depend on ecosystem services to provide their goods and services.

The need for action to restore and protect nature in the European Union is necessary as part of the Union’s commitment to international agreements on biodiversity. For example, the EU and its members are part of the multilateral treaty, the Convention on Biological Diversity (CBD), under which the Kunming-Montreal Global Biodiversity Framework was adopted in 2022, setting targets to halt and reverse the loss of biodiversity. In addition, the Regulation supports the EU’s 2030 Biodiversity Strategy, which established the commitment to present binding ecosystem restoration targets in the Union.

How does the EU Nature Restoration Law respond to these needs?

To begin with, the Regulation creates a framework that requires Member States to adopt restoration measures to support the joint EU-level target to cover at least 20% of land areas and 20% of sea areas by 2030. By 2050, the measures must cover all ecosystems in need of restoration.

In practice, the Member States must adopt restoration measures in relation to terrestrial, coastal, freshwater, and marine ecosystems which are in poor condition. These measures must cover at least:

• 30% of degraded habitat by 2030
• 60% of degraded habitat by 2040
• 90% of degraded habitat by 2050

Furthermore, the Regulation outlines obligations on EU Member States to take measures to improve pollinator diversity and increase the biodiversity in agricultural and forest ecosystems — as well as monitor and report on their progress. It also mandates Member States to identify and remove artificial barriers to the connectivity of waters, to support the objective of restoring at least 25,000km of rivers in the EU to once again become free-flowing by 2030. Lastly, Member States will have to ensure that by the end of 2030, there’s no net loss of urban green space and tree canopy cover in urban ecosystem areas.

Next steps: National Restoration Plan preparations

To reach the nature restoration targets, it’s up to Member States to implement the necessary national measures to restore habitats and nature currently in a poor condition. In practice, each Member State must prepare a national Nature Restoration Plan outlining their individual measures and tools to reach the established targets and submit these to the EU Commission by 1 September 2026. The actual steps to be taken will look different for each Member State, depending on its needs.

How will National Restoration Plans affect businesses?

The overarching restoration target and obligations included in the Regulation are directed towards the states, and not business actors. However, the measures that need to be adopted at the national level could impact businesses in various ways in the future. For example:

• To protect natural habitats and ecosystems that are in poor condition, Member States could implement stricter measures to target pollution, industrial emissions, or wastewater treatment
• National restoration measures could have implications for landowners — such as businesses with expansion plans, especially nearby protected areas

Nevertheless, future measures adopted at the national level could also include incentives for businesses related to restoration projects and provide opportunities for frontrunner companies.

Be ready for the changes ahead

The EU Nature Restoration Regulation exemplifies a broader shift towards prioritizing biodiversity conservation in the European Union. While its practical effects are yet to unfold, this landmark legislation, alongside initiatives like the Corporate Sustainability Reporting Directive (CSRD), signals a growing focus on biodiversity in all fields of society, including in business operations.

While the preparation for national restoration efforts is about to get started in many Member States, business operators should stay vigilant regarding the type of measures that may be implemented and take any opportunity to actively have a say through, for example, public consultations.