The most successful businesses I know dedicate their time to serving customers, managing costs, and finding ways to grow. That’s especially true in Colorado, where businesses across industries are working hard to stay competitive in a fast-changing economy. The last thing they need is a new layer of confusing compliance requirements written overseas, taking them away from what they do best.

Yet that’s exactly what some American businesses would now be required to do under a sweeping new European Union regulation known as the Corporate Sustainability Due Diligence Directive, or CS3D. While it was signed by European lawmakers an ocean away, its impact would reach deep into Colorado’s economy. The directive requires certain companies to address human rights and environmental risks globally, including for American companies and their suppliers and distribution partners in the United States.

Colorado’s economy depends on global markets, and that’s why Coloradans should pay attention to these new guidelines. From advanced manufacturing to agricultural producers, businesses across our state rely on international trade and investment to grow and stay competitive. In fact, Colorado exported more than $1.4 billion in goods to the European Union in 2024, supporting jobs and local economies across the state.

It is a far-reaching compliance regime that exposes companies to new liabilities, audits, and layers of scrutiny. A recent Hudson Institute analysis estimates that initial compliance costs for American companies could range from hundreds of billions to over one trillion dollars, along with billions of dollars in recurring costs. Those are valuable dollars that would be spent on compliance instead of investing in new inventory, innovative research and development, or hiring more people. It would translate into higher prices, reduced investment, and fewer jobs in our communities.

Colorado has worked hard to build a diverse and resilient economy. Innovation in aerospace, clean energy, agriculture, tourism, and technology has helped drive economic growth across the state. That growth matters - not only for businesses, but for families who depend on stable jobs, rising wages, and affordable energy costs. Layering on new global compliance mandates threatens to stall that progress.

The impact would reach beyond boardrooms, affecting grocery prices, bills, and consumer goods, as well as hiring and wages. Local economies would feel strain when suppliers raise prices or cut investments, and travelers spend less.

We cannot afford to wait and see what the impact will be. Just look at the economic trajectory of the European Union compared to the United States over the last two decades. During that period, the U.S. economy grew by nearly 90 percent. Europe’s growth lagged far behind. Analysts point to regulatory burdens as contributing factors.

To be clear, this is not an argument against conducting business responsibly. Colorado companies already operate under robust federal and state environmental and labor standards. Many go beyond what is required because it helps attract investment and reflects the values of the communities they serve. That’s why it's important that we depend on our congressional and state lawmakers to set the rules for American companies, rather than European regulators, whom we don’t get to vote for. Coloradoans should have a voice in these decisions, and the EU’s CS3D requirement removes that crucial aspect of our democracy. Legislation such as the Protect USA Act would ensure that American businesses remain governed by U.S. law while continuing to compete in global markets.

International trade should create opportunity - not impose costly and duplicative regulations imposed from abroad that put our state’s economy and businesses in danger. For Colorado families and businesses facing rising costs, this matters.

Chris Romer is president & CEO of Vail Valley Partnership, 3-time national chamber of the year. Learn more at VailValleyPartnership.com