--- title: "EU Taxonomy eligibility vs alignment: what is the difference?" canonical_url: "https://www.sorena.io/artifacts/eu/taxonomy-regulation/faq/eligibility-vs-alignment" source_url: "https://www.sorena.io/artifacts/eu/taxonomy-regulation/faq/eligibility-vs-alignment" author: "Sorena AI" description: "Eligibility means an activity is covered by Taxonomy delegated acts; alignment means it also meets Article 3 conditions, technical screening criteria, DNSH, and minimum safeguards." published_at: "2026-05-09" updated_at: "2026-05-27" keywords: - "EU Taxonomy eligibility vs alignment" - "Taxonomy eligible activities" - "Taxonomy aligned activities" - "Article 8 disclosure" - "technical screening criteria" - "DNSH" - "minimum safeguards" - "EU Taxonomy" - "Taxonomy eligibility" - "Taxonomy alignment" - "Article 8" --- **[SORENA](https://www.sorena.io/)** - AI-Powered GRC Platform [Home](https://www.sorena.io/) | [Solutions](https://www.sorena.io/solutions) | [Artifacts](https://www.sorena.io/artifacts) | [About Us](https://www.sorena.io/about-us) | [Contact](https://www.sorena.io/contact) | [Portal](https://app.sorena.io) --- # EU Taxonomy eligibility vs alignment: what is the difference? Eligibility means an activity is covered by Taxonomy delegated acts; alignment means it also meets Article 3 conditions, technical screening criteria, DNSH, and minimum safeguards. *FAQ* *Taxonomy* *EU* ## EU Taxonomy Regulation Eligibility vs alignment Eligibility is the scoping test: is the economic activity described in a Taxonomy delegated act? Alignment is the sustainability test: does that eligible activity meet the Article 3 conditions and the applicable technical screening criteria? Use this FAQ to keep Article 8 classifications, KPIs, evidence, and public wording from treating eligible activity as automatically aligned. Under the EU Taxonomy, eligibility and alignment are sequential but different findings. An activity can be Taxonomy-eligible because it is described in delegated acts, while still not be Taxonomy-aligned unless it satisfies substantial contribution, do-no-significant-harm, minimum-safeguard, and technical-screening requirements. ## EU Taxonomy eligibility vs alignment Compare the two findings teams need for Article 8 reporting: whether an activity is covered by the Taxonomy delegated acts, and whether it qualifies as environmentally sustainable under Article 3. - **Eligibility**: Eligibility asks whether the economic activity is described in the Taxonomy delegated acts and should be treated as eligible or non-eligible in the relevant Article 8 disclosure. - **Alignment**: Alignment asks whether an eligible activity also meets the Article 3 conditions, including substantial contribution, DNSH, minimum safeguards, and technical screening criteria. | Dimension | Eligibility | Alignment | Operational implication | Sources | | --- | --- | --- | --- | --- | | Scope and covered activity | Eligibility maps the undertaking's activity, exposure, asset, product, or service to an activity described in the Taxonomy delegated acts. | Alignment starts from that mapped activity and tests whether it qualifies as environmentally sustainable under Article 3 and the applicable activity criteria. | Keep one record for the activity mapping and a second record for the alignment result; an eligible activity can remain eligible even when the alignment test fails or is incomplete. | [FAQs on Article 8 eligibility reporting](https://finance.ec.europa.eu/system/files/2022-01/sustainable-finance-taxonomy-article-8-report-eligible-activities-assets-faq_en.pdf?ref=sorena.io) - The FAQ identifies Article 1(5) of the Disclosures Delegated Act as the basis for defining eligible economic activity by reference to delegated-act descriptions.
[Regulation (EU) 2020/852 (Taxonomy Regulation)](https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=celex%3A32020R0852&ref=sorena.io) - Article 3 gives the conditions for an economic activity to qualify as environmentally sustainable.
[Commission Delegated Regulation (EU) 2021/2178 (Article 8 Disclosures Delegated Act)](https://eur-lex.europa.eu/eli/reg_del/2021/2178/oj/eng?ref=sorena.io) - The delegated act separates eligible/non-eligible disclosure from aligned activity disclosure in KPI templates and methodology. | | Who must act | Eligibility usually needs the sustainability, finance, and business owner who can identify the activity description, reporting boundary, and KPI line affected. | Alignment also needs the technical owner who can evidence screening criteria, DNSH, minimum safeguards, and any activity-specific calculations. | Do not leave alignment to the reporting team alone; they need source evidence from business, finance, legal, environmental, human-rights, and technical control owners where those facts are relevant. | [Commission Delegated Regulation (EU) 2021/2178 (Article 8 Disclosures Delegated Act)](https://eur-lex.europa.eu/eli/reg_del/2021/2178/oj/eng?ref=sorena.io) - Article 8 disclosure methodology is tied to undertaking KPIs, so eligibility work needs both activity classification and finance reporting inputs.
[Regulation (EU) 2020/852 (Taxonomy Regulation)](https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=celex%3A32020R0852&ref=sorena.io) - The Article 3 conditions explain why alignment evidence commonly spans technical, environmental, safeguards, and reporting controls. | | Trigger or threshold | Eligibility is triggered when an in-scope undertaking prepares Article 8 disclosure and must classify activities, assets, or exposures as Taxonomy-eligible or non-eligible. | Alignment is triggered when the undertaking wants to report or describe the eligible activity as Taxonomy-aligned or environmentally sustainable. | Classify first; then run the alignment test only for activity-exposure combinations where the delegated-act mapping and data are specific enough to support the test. | [FAQs on Article 8 eligibility reporting](https://finance.ec.europa.eu/system/files/2022-01/sustainable-finance-taxonomy-article-8-report-eligible-activities-assets-faq_en.pdf?ref=sorena.io) - The FAQ frames eligibility reporting as preparation for alignment disclosure, supporting sequential classification and assessment.
[Commission Delegated Regulation (EU) 2021/2178 (Article 8 Disclosures Delegated Act)](https://eur-lex.europa.eu/eli/reg_del/2021/2178/oj/eng?ref=sorena.io) - The delegated act requires disclosure of Taxonomy-aligned activities and the environmental objectives to which they substantially contribute. | | Core test | Eligibility test: is the economic activity described in the relevant Taxonomy delegated act for the objective and reporting period being assessed? | Alignment test: does that eligible activity make a substantial contribution, avoid significant harm to other objectives, meet minimum safeguards, and satisfy technical screening criteria? | A yes on eligibility is only permission to assess and disclose coverage; it is not a yes on the environmental sustainability of the activity. | [FAQs on Article 8 eligibility reporting](https://finance.ec.europa.eu/system/files/2022-01/sustainable-finance-taxonomy-article-8-report-eligible-activities-assets-faq_en.pdf?ref=sorena.io) - The FAQ ties eligibility to delegated-act activity descriptions and says eligibility assessment is not dependent on accounting standards.
[Regulation (EU) 2020/852 (Taxonomy Regulation)](https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=celex%3A32020R0852&ref=sorena.io) - Article 3 sets the alignment conditions: substantial contribution, DNSH, minimum safeguards, and technical screening criteria.
[Commission Delegated Regulation (EU) 2021/2178 (Article 8 Disclosures Delegated Act)](https://eur-lex.europa.eu/eli/reg_del/2021/2178/oj/eng?ref=sorena.io) - The delegated act's separate eligible and aligned concepts support treating eligibility as a coverage finding rather than a sustainability finding. | | Evidence records | Eligibility evidence is the activity mapping: delegated-act activity description, internal activity or exposure, reporting boundary, and KPI amount included or excluded. | Alignment evidence is the test file: technical screening criteria, substantial contribution calculation, DNSH evidence, minimum safeguards conclusion, and allocation method where only part of an amount is aligned. | Store eligibility and alignment evidence separately enough that reviewers can see why an amount moved from non-eligible to eligible, or from eligible to aligned. | [Commission Delegated Regulation (EU) 2021/2178 (Article 8 Disclosures Delegated Act)](https://eur-lex.europa.eu/eli/reg_del/2021/2178/oj/eng?ref=sorena.io) - The delegated act specifies KPI content, presentation, and methodology, which creates the record structure for activity and KPI evidence.
[Commission Notice on Article 8 Disclosures Delegated Act](https://eur-lex.europa.eu/eli/C/2023/305/oj/eng?ref=sorena.io) - Allocation guidance supports keeping the mapping, methodology, and evidence trail available for review. | | Reporting timing | Eligibility classification appears in Article 8 reporting when the undertaking discloses eligible and non-eligible activity or exposure proportions for the reporting period. | Alignment is disclosed only when the applicable Article 8 timetable and KPI methodology require or allow aligned activity reporting for the undertaking type and activity set. | Avoid reusing first-year eligibility conclusions as current alignment evidence; confirm the current delegated acts, reporting templates, and KPI methodology before publication. | [FAQs on Article 8 eligibility reporting](https://finance.ec.europa.eu/system/files/2022-01/sustainable-finance-taxonomy-article-8-report-eligible-activities-assets-faq_en.pdf?ref=sorena.io) - The FAQ describes the phased Article 8 timetable in which eligibility reporting preceded full alignment reporting for certain undertaking categories.
[Commission Delegated Regulation (EU) 2021/2178 (Article 8 Disclosures Delegated Act)](https://eur-lex.europa.eu/eli/reg_del/2021/2178/oj/eng?ref=sorena.io) - The delegated act sets application and disclosure requirements for undertaking KPIs and Taxonomy-aligned activity reporting.
[Commission Notice on Article 8 Disclosures Delegated Act](https://eur-lex.europa.eu/eli/C/2023/305/oj/eng?ref=sorena.io) - The 2023 notice provides later practical interpretation, so current reporting work should not rely only on initial eligibility-phase assumptions. | | Disclosure-control risk | The main eligibility risk is over-scoping or under-scoping the activity list, which can distort eligible and non-eligible KPI amounts. | The main alignment risk is overstating sustainability by reporting aligned amounts without the Article 3 and technical-screening evidence. | Treat unsupported alignment wording as a disclosure-control issue, not just an editorial issue, because Article 8 disclosures are designed to inform investors and the public. | [Commission Delegated Regulation (EU) 2021/2178 (Article 8 Disclosures Delegated Act)](https://eur-lex.europa.eu/eli/reg_del/2021/2178/oj/eng?ref=sorena.io) - The delegated act says disclosures help investors and the public assess the proportion of environmentally sustainable activities.
[Regulation (EU) 2020/852 (Taxonomy Regulation)](https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=celex%3A32020R0852&ref=sorena.io) - Article 3 prevents an activity from being treated as environmentally sustainable unless all stated conditions are met. | | Overlap and reuse | Eligibility and alignment can reuse the same activity inventory, entity boundary, KPI base data, and delegated-act source citation. | Alignment cannot reuse eligibility alone; it needs the criteria-level evidence and any methodology used to allocate amounts to aligned activities. | Build the evidence workflow so the eligibility inventory feeds the alignment test, but make the aligned KPI numerator depend on completed criteria evidence. | [FAQs on Article 8 eligibility reporting](https://finance.ec.europa.eu/system/files/2022-01/sustainable-finance-taxonomy-article-8-report-eligible-activities-assets-faq_en.pdf?ref=sorena.io) - The FAQ explains that eligibility reporting helps undertakings prepare for alignment disclosures.
[Commission Notice on Article 8 Disclosures Delegated Act](https://eur-lex.europa.eu/eli/C/2023/305/oj/eng?ref=sorena.io) - The notice's CapEx allocation guidance shows that aligned KPI treatment depends on evidence and methodology, not only activity coverage.
[Regulation (EU) 2020/852 (Taxonomy Regulation)](https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=celex%3A32020R0852&ref=sorena.io) - Article 3 explains why eligibility evidence can feed, but cannot replace, the alignment test. | | Practical decision rule | Call it eligible only when the activity is described in the relevant Taxonomy delegated act and the KPI or exposure treatment is documented. | Call it aligned only when the eligible activity also passes Article 3, the technical screening criteria, DNSH, and minimum-safeguards checks with retained evidence. | Use three visible states in Taxonomy reporting workpapers: non-eligible, eligible not aligned, and aligned. This prevents the most damaging shortcut: treating coverage as proof of environmental sustainability. | [FAQs on Article 8 eligibility reporting](https://finance.ec.europa.eu/system/files/2022-01/sustainable-finance-taxonomy-article-8-report-eligible-activities-assets-faq_en.pdf?ref=sorena.io) - The FAQ supports the eligibility state by describing Taxonomy-eligible and non-eligible activity reporting.
[Regulation (EU) 2020/852 (Taxonomy Regulation)](https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=celex%3A32020R0852&ref=sorena.io) - Article 3 supports the alignment state by listing the conditions for environmentally sustainable activity.
[Commission Delegated Regulation (EU) 2021/2178 (Article 8 Disclosures Delegated Act)](https://eur-lex.europa.eu/eli/reg_del/2021/2178/oj/eng?ref=sorena.io) - Article 8 templates and methodology distinguish non-eligible, eligible, and aligned information, supporting three-state workpapers. | Sources for Scope and covered activity - Eligibility: - [FAQs on Article 8 eligibility reporting](https://finance.ec.europa.eu/system/files/2022-01/sustainable-finance-taxonomy-article-8-report-eligible-activities-assets-faq_en.pdf?ref=sorena.io) - The FAQ identifies Article 1(5) of the Disclosures Delegated Act as the basis for defining eligible economic activity by reference to delegated-act descriptions. - Quote: "defines an eligible economic activity" Sources for Scope and covered activity - Alignment: - [Regulation (EU) 2020/852 (Taxonomy Regulation)](https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=celex%3A32020R0852&ref=sorena.io) - Article 3 gives the conditions for an economic activity to qualify as environmentally sustainable. - Quote: "qualify as environmentally sustainable" Sources for Scope and covered activity - operational implication: - [Commission Delegated Regulation (EU) 2021/2178 (Article 8 Disclosures Delegated Act)](https://eur-lex.europa.eu/eli/reg_del/2021/2178/oj/eng?ref=sorena.io) - The delegated act separates eligible/non-eligible disclosure from aligned activity disclosure in KPI templates and methodology. - Quote: "Taxonomy-eligible economic activities" Sources for Who must act - Eligibility: - [Commission Delegated Regulation (EU) 2021/2178 (Article 8 Disclosures Delegated Act)](https://eur-lex.europa.eu/eli/reg_del/2021/2178/oj/eng?ref=sorena.io) - Article 8 disclosure methodology is tied to undertaking KPIs, so eligibility work needs both activity classification and finance reporting inputs. - Quote: "turnover, capital expenditure and operating expenditure" Sources for Who must act - Alignment: - [Regulation (EU) 2020/852 (Taxonomy Regulation)](https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=celex%3A32020R0852&ref=sorena.io) - Article 3 requires more than coverage: it requires substantial contribution, DNSH, minimum safeguards, and technical screening criteria. - Quote: "minimum safeguards" Sources for Who must act - operational implication: - [Regulation (EU) 2020/852 (Taxonomy Regulation)](https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=celex%3A32020R0852&ref=sorena.io) - The Article 3 conditions explain why alignment evidence commonly spans technical, environmental, safeguards, and reporting controls. - Quote: "technical screening criteria" Sources for Trigger or threshold - Eligibility: - [FAQs on Article 8 eligibility reporting](https://finance.ec.europa.eu/system/files/2022-01/sustainable-finance-taxonomy-article-8-report-eligible-activities-assets-faq_en.pdf?ref=sorena.io) - The FAQ states that all large undertakings needed to report eligible and non-eligible activity proportions during the initial Article 8 reporting phase. - Quote: "eligible and non-eligible" Sources for Trigger or threshold - Alignment: - [Commission Delegated Regulation (EU) 2021/2178 (Article 8 Disclosures Delegated Act)](https://eur-lex.europa.eu/eli/reg_del/2021/2178/oj/eng?ref=sorena.io) - The delegated act requires disclosure of Taxonomy-aligned activities and the environmental objectives to which they substantially contribute. - Quote: "Taxonomy-aligned activities" Sources for Trigger or threshold - operational implication: - [FAQs on Article 8 eligibility reporting](https://finance.ec.europa.eu/system/files/2022-01/sustainable-finance-taxonomy-article-8-report-eligible-activities-assets-faq_en.pdf?ref=sorena.io) - The FAQ frames eligibility reporting as preparation for alignment disclosure, supporting sequential classification and assessment. - Quote: "prepare for their alignment disclosures" Sources for Core test - Eligibility: - [FAQs on Article 8 eligibility reporting](https://finance.ec.europa.eu/system/files/2022-01/sustainable-finance-taxonomy-article-8-report-eligible-activities-assets-faq_en.pdf?ref=sorena.io) - The FAQ ties eligibility to delegated-act activity descriptions and says eligibility assessment is not dependent on accounting standards. - Quote: "not dependent on the accounting standards" Sources for Core test - Alignment: - [Regulation (EU) 2020/852 (Taxonomy Regulation)](https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=celex%3A32020R0852&ref=sorena.io) - Article 3 sets the alignment conditions: substantial contribution, DNSH, minimum safeguards, and technical screening criteria. - Quote: "contributes substantially" Sources for Core test - operational implication: - [Commission Delegated Regulation (EU) 2021/2178 (Article 8 Disclosures Delegated Act)](https://eur-lex.europa.eu/eli/reg_del/2021/2178/oj/eng?ref=sorena.io) - The delegated act's separate eligible and aligned concepts support treating eligibility as a coverage finding rather than a sustainability finding. - Quote: "Taxonomy-aligned economic activities" Sources for Evidence records - Eligibility: - [Commission Delegated Regulation (EU) 2021/2178 (Article 8 Disclosures Delegated Act)](https://eur-lex.europa.eu/eli/reg_del/2021/2178/oj/eng?ref=sorena.io) - The delegated act specifies KPI content, presentation, and methodology, which creates the record structure for activity and KPI evidence. - Quote: "methodology to comply" Sources for Evidence records - Alignment: - [Commission Notice on Article 8 Disclosures Delegated Act](https://eur-lex.europa.eu/eli/C/2023/305/oj/eng?ref=sorena.io) - The notice requires verifiable evidence for allocating CapEx to Taxonomy-aligned activities when an asset supports both aligned and non-aligned outputs. - Quote: "based on verifiable evidence" Sources for Evidence records - operational implication: - [Commission Notice on Article 8 Disclosures Delegated Act](https://eur-lex.europa.eu/eli/C/2023/305/oj/eng?ref=sorena.io) - Allocation guidance supports keeping the mapping, methodology, and evidence trail available for review. - Quote: "methodology used to allocate" Sources for Reporting timing - Eligibility: - [FAQs on Article 8 eligibility reporting](https://finance.ec.europa.eu/system/files/2022-01/sustainable-finance-taxonomy-article-8-report-eligible-activities-assets-faq_en.pdf?ref=sorena.io) - The FAQ describes the phased Article 8 timetable in which eligibility reporting preceded full alignment reporting for certain undertaking categories. - Quote: "not required to assess" Sources for Reporting timing - Alignment: - [Commission Delegated Regulation (EU) 2021/2178 (Article 8 Disclosures Delegated Act)](https://eur-lex.europa.eu/eli/reg_del/2021/2178/oj/eng?ref=sorena.io) - The delegated act sets application and disclosure requirements for undertaking KPIs and Taxonomy-aligned activity reporting. - Quote: "key performance indicators" Sources for Reporting timing - operational implication: - [Commission Notice on Article 8 Disclosures Delegated Act](https://eur-lex.europa.eu/eli/C/2023/305/oj/eng?ref=sorena.io) - The 2023 notice provides later practical interpretation, so current reporting work should not rely only on initial eligibility-phase assumptions. - Quote: "Taxonomy-aligned activities" Sources for Disclosure-control risk - Eligibility: - [Commission Delegated Regulation (EU) 2021/2178 (Article 8 Disclosures Delegated Act)](https://eur-lex.europa.eu/eli/reg_del/2021/2178/oj/eng?ref=sorena.io) - The delegated act aims to make Article 8 disclosures uniform and assessable through KPI content, presentation, and methodology. - Quote: "uniform application" Sources for Disclosure-control risk - Alignment: - [Regulation (EU) 2020/852 (Taxonomy Regulation)](https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=celex%3A32020R0852&ref=sorena.io) - Article 3 prevents an activity from being treated as environmentally sustainable unless all stated conditions are met. - Quote: "complies with technical screening criteria" Sources for Disclosure-control risk - operational implication: - [Commission Delegated Regulation (EU) 2021/2178 (Article 8 Disclosures Delegated Act)](https://eur-lex.europa.eu/eli/reg_del/2021/2178/oj/eng?ref=sorena.io) - The delegated act says disclosures help investors and the public assess the proportion of environmentally sustainable activities. - Quote: "investors and the public" Sources for Overlap and reuse - Eligibility: - [FAQs on Article 8 eligibility reporting](https://finance.ec.europa.eu/system/files/2022-01/sustainable-finance-taxonomy-article-8-report-eligible-activities-assets-faq_en.pdf?ref=sorena.io) - The FAQ explains that eligibility reporting helps undertakings prepare for alignment disclosures. - Quote: "prepare for their alignment disclosures" Sources for Overlap and reuse - Alignment: - [Commission Notice on Article 8 Disclosures Delegated Act](https://eur-lex.europa.eu/eli/C/2023/305/oj/eng?ref=sorena.io) - The notice's CapEx allocation guidance shows that aligned KPI treatment depends on evidence and methodology, not only activity coverage. - Quote: "accurate allocation" Sources for Overlap and reuse - operational implication: - [Regulation (EU) 2020/852 (Taxonomy Regulation)](https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=celex%3A32020R0852&ref=sorena.io) - Article 3 explains why eligibility evidence can feed, but cannot replace, the alignment test. - Quote: "does not significantly harm" Sources for Practical decision rule - Eligibility: - [FAQs on Article 8 eligibility reporting](https://finance.ec.europa.eu/system/files/2022-01/sustainable-finance-taxonomy-article-8-report-eligible-activities-assets-faq_en.pdf?ref=sorena.io) - The FAQ supports the eligibility state by describing Taxonomy-eligible and non-eligible activity reporting. - Quote: "Taxonomy-eligible economic activities" Sources for Practical decision rule - Alignment: - [Regulation (EU) 2020/852 (Taxonomy Regulation)](https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=celex%3A32020R0852&ref=sorena.io) - Article 3 supports the alignment state by listing the conditions for environmentally sustainable activity. - Quote: "carried out in compliance" Sources for Practical decision rule - operational implication: - [Commission Delegated Regulation (EU) 2021/2178 (Article 8 Disclosures Delegated Act)](https://eur-lex.europa.eu/eli/reg_del/2021/2178/oj/eng?ref=sorena.io) - Article 8 templates and methodology distinguish non-eligible, eligible, and aligned information, supporting three-state workpapers. - Quote: "Taxonomy-eligible, but not Taxonomy-aligned" ### How should teams decide between EU Taxonomy eligibility and alignment? - Start with eligibility: check whether the economic activity is described in the applicable Taxonomy delegated act. - Only proceed to the four-part alignment test after confirming eligibility; alignment is not a substitute for the scoping step. - Keep separate evidence sets for the eligibility mapping and each Article 3 alignment condition so a future reviewer can rerun the analysis independently. - Escalate when an activity spans multiple delegated acts, delegated-act versions, or when DNSH or minimum-safeguard findings are unclear. Sources for the practical decision rule: - [FAQs on Article 8 eligibility reporting](https://finance.ec.europa.eu/system/files/2022-01/sustainable-finance-taxonomy-article-8-report-eligible-activities-assets-faq_en.pdf?ref=sorena.io) - Article 8 FAQ supports the eligibility first, alignment second sequence and the evidence standard. - Quote: "Taxonomy-eligible economic activities" - [Regulation (EU) 2020/852 (Taxonomy Regulation)](https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A32020R0852&ref=sorena.io) - Article 3 sets the four-part alignment conditions that follow a positive eligibility finding. - Quote: "environmentally sustainable economic activity" ## What is the difference between Taxonomy eligibility and alignment? Taxonomy eligibility is about coverage. For Article 8 reporting, teams first map an economic activity to the activities described in the Taxonomy delegated acts and classify it as eligible or non-eligible for the relevant KPI or exposure. Taxonomy alignment is a higher bar. Article 3 says an economic activity qualifies as environmentally sustainable only where it contributes substantially to one or more Article 9 environmental objectives, does no significant harm to the other objectives, complies with minimum safeguards, and meets the technical screening criteria established by the Commission. - Do not use an eligible activity label as a sustainability claim by itself. - Run eligibility before alignment, because an alignment assessment needs the relevant delegated-act activity and criteria. - Keep non-eligible, eligible-not-aligned, and aligned amounts separate in Article 8 evidence and explanations. Sources for this answer: - [Regulation (EU) 2020/852 (Taxonomy Regulation)](https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=celex%3A32020R0852&ref=sorena.io) - Article 3 provides the four conditions for an economic activity to qualify as environmentally sustainable; Article 8 requires undertakings in scope to disclose how and to what extent their activities are associated with environmentally sustainable economic activities. - [Commission Delegated Regulation (EU) 2021/2178 (Article 8 Disclosures Delegated Act)](https://eur-lex.europa.eu/eli/reg_del/2021/2178/oj/eng?ref=sorena.io) - The Disclosures Delegated Act implements Article 8 and uses separate eligible, non-eligible, and aligned disclosure concepts for undertaking KPIs. ## How should teams apply the distinction in Article 8 reporting? For non-financial undertakings, Article 8 focuses on the proportions of turnover, capital expenditure, and operating expenditure associated with environmentally sustainable economic activities. The Disclosures Delegated Act and Commission FAQ explain that eligibility is reported before or alongside alignment, but eligibility reporting is not the same as proving alignment. For financial undertakings, the Article 8 framework uses financial KPIs that look through to financed or invested activities. That makes the eligibility-vs-alignment distinction a data lineage issue: the financial KPI should show whether the underlying activity or exposure is non-eligible, eligible but not aligned, or aligned. - Map each activity or exposure to the delegated-act activity description before calculating eligible amounts. - Only report aligned amounts where the activity-specific technical screening criteria, DNSH criteria, and minimum safeguards assessment are evidenced. - Document the KPI basis used, such as turnover, CapEx, OpEx, total assets, GAR, or other financial-undertaking templates that apply to the reporting entity. Sources for this answer: - [FAQs on Article 8 eligibility reporting](https://finance.ec.europa.eu/system/files/2022-01/sustainable-finance-taxonomy-article-8-report-eligible-activities-assets-faq_en.pdf?ref=sorena.io) - Commission FAQ explains that large undertakings reported eligible and non-eligible activities first, and were not required in that initial phase to assess Taxonomy alignment. - [Commission Notice on Article 8 Disclosures Delegated Act](https://eur-lex.europa.eu/eli/C/2023/305/oj/eng?ref=sorena.io) - The 2023 Article 8 notice gives practical guidance on KPI allocation and requires verifiable evidence for allocating CapEx to Taxonomy-aligned activities. ## What evidence should support eligibility and alignment decisions? The evidence pack should show both steps. Eligibility evidence should prove why the activity is described in the relevant Taxonomy delegated act. Alignment evidence should prove why the same activity meets the Article 3 conditions and the activity-level technical screening criteria. The most useful file is a reconciliation record: source activity description, internal activity or exposure, KPI denominator and numerator treatment, alignment test result, and the reason any eligible amount was excluded from aligned amounts. - Eligibility record: delegated-act activity name or section, mapped business activity, reporting entity boundary, and eligible/non-eligible conclusion. - KPI record: turnover, CapEx, OpEx, total assets, GAR, or other applicable KPI treatment, with the accounting or consolidation basis used. - Alignment record: substantial contribution test, DNSH assessment, minimum safeguards conclusion, and technical screening criteria evidence. - Allocation record: methodology and evidence for split-use assets, mixed activities, internal consumption, or pro-rata treatment. - Disclosure-control record: reviewer sign-off, unresolved assumptions, and wording checks that prevent eligible activity from being presented as aligned. Sources for this answer: - [Regulation (EU) 2020/852 (Taxonomy Regulation)](https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=celex%3A32020R0852&ref=sorena.io) - Article 3 ties alignment to substantial contribution, DNSH, minimum safeguards, and technical screening criteria; evidence should therefore cover each condition. - [Commission Notice on Article 8 Disclosures Delegated Act](https://eur-lex.europa.eu/eli/C/2023/305/oj/eng?ref=sorena.io) - The notice states that CapEx allocation to Taxonomy-aligned activities should be based on verifiable evidence, supporting documented allocation records for mixed-use assets. ## What is the common mistake? The common mistake is to say that an eligible activity is Taxonomy-aligned without completing the alignment test. Eligibility only says the activity is covered by the Taxonomy activity list. Alignment says the activity satisfies the sustainability conditions and the activity-specific criteria. A second mistake is to keep only the final KPI table. Reviewers need the mapping and test evidence behind the table, especially where an activity is eligible but not aligned, or where only part of CapEx, OpEx, turnover, or an exposure is allocated to aligned activity. - Avoid saying an activity is environmentally sustainable when the evidence only supports eligibility. - Avoid merging eligible and aligned amounts in internal dashboards or external summaries. - Avoid unreviewed carry-forward classifications after delegated-act, activity, asset-use, or reporting-boundary changes. Sources for this answer: - [Commission Delegated Regulation (EU) 2021/2178 (Article 8 Disclosures Delegated Act)](https://eur-lex.europa.eu/eli/reg_del/2021/2178/oj/eng?ref=sorena.io) - The delegated act separates Taxonomy-eligible/non-eligible disclosures from Taxonomy-aligned KPI disclosures, so teams should preserve that distinction in reporting controls. - [FAQs on Article 8 eligibility reporting](https://finance.ec.europa.eu/system/files/2022-01/sustainable-finance-taxonomy-article-8-report-eligible-activities-assets-faq_en.pdf?ref=sorena.io) - The FAQ explains eligibility reporting as a preparation step for later alignment disclosures, not as a substitute for an alignment assessment. ## Primary sources - [Regulation (EU) 2020/852 (Taxonomy Regulation)](https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A32020R0852&ref=sorena.io) - Article 3 sets the four-part alignment conditions that follow a positive eligibility finding. - Quote: "environmentally sustainable economic activity" - [Commission Delegated Regulation (EU) 2021/2178 (Article 8 Disclosures Delegated Act)](https://eur-lex.europa.eu/eli/reg_del/2021/2178/oj/eng?ref=sorena.io) - Article 8 templates and methodology distinguish non-eligible, eligible, and aligned information, supporting three-state workpapers. - Quote: "Taxonomy-eligible, but not Taxonomy-aligned" - [FAQs on Article 8 eligibility reporting](https://finance.ec.europa.eu/system/files/2022-01/sustainable-finance-taxonomy-article-8-report-eligible-activities-assets-faq_en.pdf?ref=sorena.io) - Article 8 FAQ supports the eligibility first, alignment second sequence and the evidence standard. - Quote: "Taxonomy-eligible economic activities" - [Commission Notice on Article 8 Disclosures Delegated Act](https://eur-lex.europa.eu/eli/C/2023/305/oj/eng?ref=sorena.io) - The notice's CapEx allocation guidance shows that aligned KPI treatment depends on evidence and methodology, not only activity coverage. - Quote: "accurate allocation" ## Topic Guides - [DNSH Appendix C under the EU Taxonomy: chemicals evidence FAQ](/artifacts/eu/taxonomy-regulation/faq/dnsh-appendix-c.md): Practical FAQ on EU Taxonomy DNSH Appendix C chemicals criteria, including SVHCs, CLP hazard classes, the 0.1% w/w threshold, suitable alternatives, and controlled conditions evidence. - [EU Taxonomy 2026 simplification: what should teams do?](/artifacts/eu/taxonomy-regulation/faq/2026-simplification.md): source-linked FAQ on EU Taxonomy 2026 simplification, Regulation (EU) 2026/73, Article 8 reporting, DNSH evidence, and limits on unsupported claims. - [EU Taxonomy Activity Eligibility Workflow](/artifacts/eu/taxonomy-regulation/activity-eligibility-workflow.md): Build an EU Taxonomy activity eligibility workflow that maps economic activities to delegated-act descriptions before alignment, DNSH, and Article 8 KPI reporting. - [EU Taxonomy activity evidence packs: what to retain](/artifacts/eu/taxonomy-regulation/faq/activity-evidence-packs.md): A practical FAQ on EU Taxonomy activity evidence packs: eligibility, alignment, DNSH, minimum safeguards, KPI traceability, and source-linked review records. - [EU Taxonomy Applicability Test for Eligibility and Alignment](/artifacts/eu/taxonomy-regulation/applicability-test.md): Test EU Taxonomy applicability by separating Article 8 reporting scope, Taxonomy eligibility, Taxonomy alignment, DNSH, minimum safeguards, and KPI evidence. - [EU Taxonomy Article 8 disclosure templates](/artifacts/eu/taxonomy-regulation/templates.md): source-linked EU Taxonomy templates for Article 8 reporting, covering non-financial KPIs, financial undertaking annexes, eligibility and alignment evidence, GAR inputs, and publication checks. - [EU Taxonomy Article 8 KPI disclosure workflow](/artifacts/eu/taxonomy-regulation/kpis-and-disclosure-workflow.md): source-linked workflow for EU Taxonomy Article 8 KPI disclosures, covering turnover, CapEx, OpEx, GAR dependencies, templates, contextual information, and publication checks. - [EU Taxonomy Article 8 Scope and Reporting Entities](/artifacts/eu/taxonomy-regulation/scope-and-reporting-entities.md): Determine which financial and non-financial undertakings report under EU Taxonomy Article 8, which annexes apply, and what evidence supports the reporting boundary. - [EU Taxonomy Article 8 Scope FAQ](/artifacts/eu/taxonomy-regulation/faq/article-8-scope.md): source-linked FAQ on EU Taxonomy Article 8 scope, including who reports, which KPI framework applies, and what evidence teams should retain. - [EU Taxonomy auditor evidence: what to keep for alignment review](/artifacts/eu/taxonomy-regulation/faq/auditor-evidence.md): Practical FAQ on EU Taxonomy auditor evidence: what evidence supports eligibility, alignment, DNSH, minimum safeguards, and Article 8 KPI disclosures. - [EU Taxonomy CapEx Plan Evidence Workflow](/artifacts/eu/taxonomy-regulation/capex-plan-evidence-workflow.md): Build an EU Taxonomy CapEx plan evidence workflow for Article 8 CapEx KPI reporting, management-body approval, milestones, amendments, allocation, and restatement controls. - [EU Taxonomy CapEx Plan Evidence: Article 8 checklist](/artifacts/eu/taxonomy-regulation/capex-plan-evidence.md): Build evidence for EU Taxonomy CapEx plans under Article 8, Annex I Section 1.1.2.2 and the Disclosures Delegated Act. - [EU Taxonomy CapEx Plans FAQ: Article 8 CapEx KPI](/artifacts/eu/taxonomy-regulation/faq/capex-plans.md): Practical FAQ on EU Taxonomy CapEx plans under Article 8, Annex I Section 1.1.2.2, management-body approval, timing, activity-level evidence, and KPI restatement. - [EU Taxonomy compliance guide: eligibility, alignment and Article 8 KPIs](/artifacts/eu/taxonomy-regulation/compliance.md): Practical EU Taxonomy compliance guide for mapping eligible activities, testing alignment, collecting DNSH and minimum-safeguards evidence, and preparing Article 8 disclosures. - [EU Taxonomy deadlines and Article 8 compliance calendar](/artifacts/eu/taxonomy-regulation/deadlines-and-compliance-calendar.md): source-linked EU Taxonomy calendar for Article 8 reporting phases, environmental objective application dates, delegated-act updates, and evidence review gates. - [EU Taxonomy Delegated Act Change Tracker](/artifacts/eu/taxonomy-regulation/delegated-act-change-tracker.md): Track adopted and proposed EU Taxonomy delegated-act changes by source, status, affected criteria, Article 8 disclosure impact, owner, and evidence update. - [EU Taxonomy delegated act changes: what teams should check](/artifacts/eu/taxonomy-regulation/faq/delegated-act-changes.md): FAQ on handling EU Taxonomy delegated act changes: official source checks, application dates, affected criteria, disclosures, DNSH evidence, and review records. - [EU Taxonomy Delegated Acts Tracker](/artifacts/eu/taxonomy-regulation/delegated-acts-tracker.md): Track EU Taxonomy delegated acts by legal status, objective, reporting impact, activity scope, DNSH criteria, Article 8 disclosures, and owner follow-up. - [EU Taxonomy DNSH and Minimum Safeguards evidence guide](/artifacts/eu/taxonomy-regulation/dnsh-and-minimum-safeguards.md): source-linked guide to EU Taxonomy DNSH and minimum safeguards: Article 3 alignment gates, Article 17 significant harm, Article 18 safeguards, evidence records, and KPI controls. - [EU Taxonomy DNSH Appendix C: chemicals evidence guide](/artifacts/eu/taxonomy-regulation/dnsh-appendix-c.md): source-linked guide to EU Taxonomy DNSH Appendix C chemicals checks, including SVHC thresholds, alternatives, controlled conditions, and evidence records. - [EU Taxonomy Eligibility vs Alignment](/artifacts/eu/taxonomy-regulation/taxonomy-eligibility-vs-alignment.md): Compare EU Taxonomy eligibility and alignment under Article 8: what each term means, what evidence is needed, which KPIs are affected, and why eligibility is not proof of sustainability. - [EU Taxonomy Eligibility vs Alignment Explained](/artifacts/eu/taxonomy-regulation/taxonomy-eligibility-vs-alignment-explained.md): Explain EU Taxonomy eligibility and alignment under Article 8, the Disclosures Delegated Act, Article 3, technical screening criteria, DNSH, and safeguards. - [EU Taxonomy FAQ: eligibility, alignment, DNSH, safeguards, and Article 8](/artifacts/eu/taxonomy-regulation/faq.md): EU Taxonomy FAQ hub for eligibility, alignment, technical screening criteria, DNSH, minimum safeguards, Article 8 KPIs, delegated acts, and evidence records. - [EU Taxonomy Financial KPIs and Green Asset Ratio (GAR) FAQ](/artifacts/eu/taxonomy-regulation/faq/financial-kpis-and-gar.md): FAQ on EU Taxonomy Article 8 financial undertaking KPIs, credit institution Green Asset Ratio (GAR), reporting dates, exclusions, and qualitative disclosures. - [EU Taxonomy GAR and financial undertaking KPIs](/artifacts/eu/taxonomy-regulation/gar-and-financial-undertaking-kpis.md): source-linked guide to EU Taxonomy Article 8 financial undertaking KPIs, including GAR, asset manager KPIs, investment firm KPIs, insurance KPIs, exclusions, and reporting evidence. - [EU Taxonomy GAR KPI workflow for credit institutions](/artifacts/eu/taxonomy-regulation/gar-kpi-workflow.md): source-linked workflow for preparing EU Taxonomy Green Asset Ratio (GAR) KPI disclosures under Article 8 and the Disclosures Delegated Act. - [EU Taxonomy minimum safeguards FAQ: Article 18 evidence](/artifacts/eu/taxonomy-regulation/faq/minimum-safeguards.md): FAQ on EU Taxonomy minimum safeguards under Article 18: who must comply, which OECD, UNGP, ILO and human-rights evidence to keep, and common reporting mistakes. - [EU Taxonomy Minimum Safeguards: Article 18 and evidence](/artifacts/eu/taxonomy-regulation/minimum-safeguards.md): Understand how Article 18 minimum safeguards fit into EU Taxonomy alignment, which international standards they reference, and what evidence supports the assessment. - [EU Taxonomy non-financial KPIs: turnover, CapEx and OpEx](/artifacts/eu/taxonomy-regulation/faq/non-financial-kpis.md): Article 8 FAQ for non-financial undertakings reporting EU Taxonomy turnover, CapEx and OpEx KPIs, with evidence and source checks. - [EU Taxonomy Penalties and Fines: Article 22 Disclosure Risk](/artifacts/eu/taxonomy-regulation/penalties-and-fines.md): Understand where EU Taxonomy penalty exposure starts: Article 22 measures and penalties for Articles 5, 6, and 7 financial product disclosures, with practical evidence controls. - [EU Taxonomy Regulation Checklist for Eligibility and Alignment](/artifacts/eu/taxonomy-regulation/checklist.md): A source-linked EU Taxonomy checklist for mapping eligible activities, testing alignment, documenting DNSH and minimum safeguards, and preparing Article 8 KPI disclosures. - [EU Taxonomy Regulation requirements: eligibility, alignment, KPIs](/artifacts/eu/taxonomy-regulation/requirements.md): Understand the core EU Taxonomy requirements: Article 3 alignment tests, eligible activities, DNSH, minimum safeguards, Article 8 KPIs, and evidence to keep. - [EU Taxonomy screening criteria and documentation guide](/artifacts/eu/taxonomy-regulation/screening-criteria-and-documentation.md): How to document EU Taxonomy eligibility, alignment, technical screening criteria, DNSH, minimum safeguards, and Article 8 KPI disclosures without overstating the evidence. - [EU Taxonomy Six Environmental Objectives | Article 9 FAQ](/artifacts/eu/taxonomy-regulation/faq/six-environmental-objectives.md): Plain-English FAQ on the six EU Taxonomy environmental objectives in Article 9 and how teams should map activities, DNSH checks, safeguards, and evidence. - [EU Taxonomy vs CSRD: Article 8 Reporting Comparison](/artifacts/eu/taxonomy-regulation/taxonomy-vs-csrd.md): Compare EU Taxonomy Article 8 disclosures with CSRD sustainability reporting scope, evidence, KPIs, assurance, and reuse limits using official EU Taxonomy sources. - [EU Taxonomy vs SFDR: Scope, KPIs, and Evidence](/artifacts/eu/taxonomy-regulation/taxonomy-vs-sfdr.md): Compare the EU Taxonomy and the SFDR link points that appear in Taxonomy materials: activity classification, Article 8 KPIs, product disclosures, data reuse, and evidence limits. *Recommended next step* *Placement: after evidence section* ## Turn EU Taxonomy classifications into reviewable evidence Use Sorena to keep eligibility mapping, alignment tests, KPI calculations, and disclosure wording tied to the source record behind each Taxonomy classification. - [Open Research Copilot](/solutions/research-copilot.md): Ask EU Taxonomy questions against cited source material. - [Discuss EU Taxonomy implementation](/contact.md): Review classification controls, evidence gaps, and disclosure workflow options. --- [Privacy Policy](https://www.sorena.io/privacy) | [Terms of Use](https://www.sorena.io/terms-of-use) | [DMCA](https://www.sorena.io/dmca) | [About Us](https://www.sorena.io/about-us) (c) 2026 Sorena AB (559573-7338). 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