Commission Regulation (EU) 2025/1266 of 30 June 2025 amending Regulation (EU) 2023/1803 as regards International Financial Reporting Standard 9 and International Financial Reporting Standard 7

THE EUROPEAN COMMISSION,

Having regard to the Treaty on the Functioning of the European Union,

Having regard to Regulation (EC) No 1606/2002 of the European Parliament and of the Council of 19 July 2002 on the application of international accounting standards (1), and in particular Article 3(1) thereof,

Whereas:

(1) By Commission Regulation (EU) 2023/1803 (2) certain international accounting standards and interpretations that were in existence until 8 September 2022 were adopted.

(2) On 18 December 2024, the International Accounting Standards Board (‘IASB’) issued amendments to International Financial Reporting Standard 9 Financial Instruments (‘IFRS 9’) and International Financial Reporting Standard 7 Financial Instruments: Disclosures (‘IFRS 7’) to help companies better report the financial effects of nature-dependent electricity contracts, which are often structured as power purchase agreements.

(3) The amendments address how the ‘own-use’ requirements would apply, permit hedge accounting if those contracts are used as hedging instruments, and add disclosure requirements to enable investors to understand the effects of those contracts on a company’s financial performance and future cash flows.

(4) Following a consultation with the European financial reporting advisory group EFRAG, the Commission has concluded that the amendments to IFRS 9 and IFRS 7 meet the conditions for adoption set out in Article 3(2) of Regulation (EC) No 1606/2002.

(5) Regulation (EU) 2023/1803 should therefore be amended accordingly.

(6) The measures provided for in this Regulation are in accordance with the opinion of the Accounting Regulatory Committee,

HAS ADOPTED THIS REGULATION:

Article 1

In the Annex to Regulation (EU) 2023/1803, the following is amended in accordance with the Annex to this Regulation:

(a) International Financial Reporting Standard (‘IFRS’) 9 Financial Instruments;

(b) IFRS 7 Financial Instruments: Disclosures.

Article 2

Each company shall apply the amendments referred to in Article 1, at the latest, as from the commencement date of its first financial year starting on or after 1 January 2026.

Article 3

This Regulation shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union.

This Regulation shall be binding in its entirety and directly applicable in all Member States.

Done at Brussels, 30 June 2025.

For the Commission The President Ursula VON DER LEYEN

(1) OJ L 243, 11.9.2002, p. 1, ELI: http://data.europa.eu/eli/reg/2002/1606/oj.

(2) Commission Regulation (EU) 2023/1803 of 13 September 2023 adopting certain international accounting standards in accordance with Regulation (EC) No 1606/2002 of the European Parliament and of the Council (OJ L 237, 26.9.2023, p. 1, ELI: http://data.europa.eu/eli/reg/2023/1803/oj).