TaxonomyEligibility workflowEU

EU Taxonomy Activity Eligibility Workflow

A workflow for deciding whether an economic activity is Taxonomy-eligible by matching it to delegated-act activity descriptions before any alignment conclusion is made.

Use it to separate eligible, non-eligible, and unresolved activity claims before reporting turnover, capital expenditure (CapEx), operating expenditure (OpEx), the green asset ratio (), or narrative disclosures.

Author
Sorena AI
Published
May 9, 2026
Updated
Oct 15, 2026
Overview

asks whether an economic activity is described in a delegated act adopted under the Taxonomy Regulation. It does not show that the activity meets technical screening criteria, does no significant harm, satisfies minimum safeguards, or is environmentally sustainable. Regulation (EU) 2026/73 applies from 1 January 2026, but an undertaking may use the rules in force on 31 December 2025 for a financial year that began in 2025. Under the amended rules, record any permitted assessment omission and report the affected amount separately as non-material.

Section 1

Start with the eligibility decision rule

The first workflow control is a definition check. Under the Disclosures Delegated Act, a Taxonomy-eligible economic activity is an activity described in delegated acts adopted for the Taxonomy environmental objectives, regardless of whether it meets any or all technical screening criteria in those delegated acts.

That means the eligibility record should never say that a mapped activity is sustainable, aligned, DNSH-compliant, or minimum-safeguards compliant unless a separate alignment assessment supports that conclusion.

  • Decision question: is the undertaking's economic activity described in an applicable EU Taxonomy delegated act?
  • Eligibility result: eligible, non-eligible, unresolved because the activity description or reporting boundary is not specific enough, or not assessed under a documented materiality option.
  • Alignment separation: record substantial-contribution criteria, DNSH criteria, and minimum safeguards as later tests, not as eligibility requirements.
  • Evidence rule: cite the delegated-act activity description or Commission notice used to interpret the activity scope.
  • Public wording rule: describe eligibility as a reporting classification, not as proof of environmental performance.
Recommended next step

Turn activity mapping into reportable evidence

This workflow helps connect EU Taxonomy activity descriptions, eligibility decisions, KPI impacts, owners, and evidence records before alignment or Article 8 reporting is finalized.

Section 2

Map each activity before calculating KPIs

Run eligibility at the level of economic activities, not at the level of business units, brands, suppliers, or broad product families. The activity record should show the resources, process, and output that produce goods or services, then match that activity to the relevant delegated-act description.

can help users navigate the Taxonomy, but they are not the final eligibility test. If a NACE code is broader than the delegated-act activity description, the description prevails; if the activity fits the description even without a listed NACE code, it can still be eligible.

  • Create one row per economic activity, with the product or service output and the accounting entity or group boundary.
  • Record the delegated act, annex, activity number or description, environmental objective, and any enabling, transitional, or adaptation label visible in the source.
  • Use as search aids and cross-checks, then document the final match against the exact activity description.
  • Mark upstream or downstream value-chain activity as eligible only when the activity description explicitly covers it.
  • Keep unresolved activities out of the eligible numerator until the description match is clear enough for review.
  • For reporting under the amended rules from 1 January 2026, keep activities omitted from assessment under a permitted materiality threshold in a separate non-material amount; do not relabel them as non-eligible.
Section 3

Connect eligibility to turnover, CapEx, OpEx, and financial exposures

After the activity match is documented, classify which disclosure metric the activity can affect. For non-financial undertakings, Article 8 reporting uses the proportions of turnover, capital expenditure, and operating expenditure associated with Taxonomy-eligible and Taxonomy-aligned economic activities.

For financial undertakings, eligibility work depends on the applicable financial-undertaking templates and the available information from counterparties, assets, use-of-proceeds instruments, or underwriting activity. The workflow should record the source of the counterparty or asset-level eligibility data rather than treating a financial exposure as eligible by label alone.

  • Turnover: link eligible revenue to the economic activity and the revenue basis used in the financial statements.
  • CapEx: identify whether expenditure relates to eligible assets or processes, a plan to expand or upgrade eligible activities, or purchases of eligible output or individual measures.
  • OpEx: identify the eligible activity or plan that the operating expenditure supports and keep OpEx categories consistent with the Annex I methodology.
  • Financial exposures: record whether the value comes from issuer-level turnover or CapEx KPIs, use-of-proceeds allocation, covered assets, the applicable financial-undertaking KPI methodology, or another template-specific method.
  • Double counting: explain how the same turnover, CapEx, OpEx, bond proceeds, debt security, or exposure was counted only once in the relevant KPI numerator.
Section 4

Evidence fields and stop checks for eligibility review

The eligibility file should be reviewable without reconstructing the whole analysis. Each row should show the source, the activity description match, the KPI impact, the owner, and the reason the claim is limited to eligibility or escalated into alignment testing.

Stop the workflow when the public wording is broader than the source, when a NACE code is being used as the only proof, when voluntary information is mixed with mandatory disclosures without explanation, or when a draft or advisory source is treated as a binding delegated act.

  • Source fields: external URL, legal or guidance status, act or notice number, activity description, and short source quote.
  • Activity fields: entity boundary, product or service output, delegated-act match, objective, NACE code if used, and unresolved interpretation notes.
  • KPI fields: turnover, CapEx, OpEx, , covered asset, use-of-proceeds, or non-life underwriting impact, with numerator and denominator rationale where relevant.
  • Review fields: preparer, finance owner, sustainability owner, legal or assurance reviewer, decision date, and next trigger for delegated-act or notice changes.
  • Stop checks: no sustainability claim from eligibility alone, no unlabelled voluntary reporting, no duplicated numerator amounts, no missing explanation for non-eligible activities, and no materiality omission recorded as non-eligible.
Primary sources

References and citations

eur-lex.europa.eu3 citations
Referenced sections
  • Commission interpretation source for reporting Taxonomy-eligible and Taxonomy-aligned economic activities and assets under Article 8.
  • Provides further Article 8 interpretation for Taxonomy-eligible and Taxonomy-aligned economic activities and related disclosure questions.
  • Supports separating voluntary and mandatory reporting, explaining KPI allocations, avoiding double counting, and presenting activity-level CapEx information.
"Taxonomy-eligible and Taxonomy-aligned economic activities"
More quoted passages
"should not be given more prominence than the mandatory reporting"
eur-lex.europa.eu3 citations
Referenced sections
  • Commission interpretation source for eligibility reporting, NACE-code use, value-chain boundaries, turnover, CapEx, OpEx, voluntary information, and double-counting controls.
  • Explains that eligibility is based on delegated-act activity descriptions, that NACE references are indicative, and that value-chain outputs are not automatically eligible.
  • Explains eligibility reporting for turnover, CapEx, OpEx, covered assets, use-of-proceeds instruments, voluntary reporting, and double-counting controls.
"specific activity description"
More quoted passages
"only the specific activity description"
"avoided double counting"
eur-lex.europa.eu3 citations
Referenced sections
  • Binding source defining Taxonomy-eligible and Taxonomy-non-eligible economic activities and specifying Article 8 disclosure methodology and templates.
  • Defines Taxonomy-eligible and Taxonomy-non-eligible economic activities and specifies Article 8 disclosure content, presentation, and methodology.
  • Specifies Article 8 KPIs and qualitative disclosure requirements for non-financial and financial undertakings, including turnover, CapEx, OpEx, and financial-undertaking templates.
"taxonomy-eligible economic activity"
More quoted passages
"irrespective of whether that economic activity meets any or all of the technical screening criteria"
"turnover, capital expenditure and operating expenditure"
eur-lex.europa.eu2 citations
Referenced sections
  • Binding 2026 amendment introducing assessment materiality options and separate non-material reporting while preserving the distinction between eligibility and alignment.
  • Article 1 introduces 10% activity-assessment thresholds for non-financial undertaking turnover and CapEx, conditional OpEx options, and separate reporting of the omitted amounts as non-material.
finance.ec.europa.eu2 citations
Referenced sections
  • Official Commission hub for EU Taxonomy legislation, delegated acts, guidance, navigator tools, and related sustainable-finance resources.
  • Commission hub for the EU Taxonomy, delegated and implementing acts, the EU Taxonomy Navigator, and related official guidance.
"market transparency tool"
eur-lex.europa.eu2 citations
Referenced sections
  • Binding source for the Taxonomy framework, environmental objectives, Article 3 alignment conditions, DNSH, minimum safeguards, technical screening criteria, and Article 8 disclosure basis.
  • Sets the separate conditions for an environmentally sustainable economic activity: substantial contribution, no significant harm, minimum safeguards, and technical screening criteria.
"framework to facilitate sustainable investment"
More quoted passages
"qualifies as environmentally sustainable"
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