EU Due Diligence Directive: Commission falls behind on announcements

On February 23, 2022, the EU Commission presented its proposal for an EU Due Diligence Directive. This is a big step forward towards a more just and fair globalization! It is also very welcome that the draft directive closes some gaps in German law:

  • The guideline holds companies responsible along their entire supply chain,
  • There is also civil liability.

The draft stipulates that EU companies with more than 500 employees and a turnover of 150 million euros and in risk sectors for EU companies with more than 250 employees and a turnover of 40 million euros must take responsibility for the supply chain. This is a clear step forward compared to Germany (where only companies with 1,000 employees will be included from 2024). But even the EU limit is not enough, insofar as the directive would probably only apply to less than one percent of EU companies.

As welcome as the inclusion of a liability rule in the directive is, it must be feared that companies could exploit possible loopholes. Because the draft directive provides that companies can meet their obligations by including certain clauses in their contracts with suppliers and outsourcing the verification process. This would give companies the opportunity to pass on their responsibility to their suppliers.

It is also problematic that the due diligence requirements are limited to ‘established business relationships’. In principle, it is therefore possible for companies to evade this by frequently changing suppliers.

For this reason, the Supply Chain Law Initiative, of which XertifiX is a member, calls on the federal government to use its influence in the EU to advocate for improvements so that Europe ultimately has a really effective supply chain law, as is also stipulated in the German coalition agreement.

Please refer: Proposal for a Directive on corporate sustainability due diligence and annex

Please see also: Dangerous gaps undermine EU Commission’s new legislation on sustainable supply chains

Please see also: Initiative Lieferkettengesetz

2022-02-25T10:38:07+01:00February 23rd, 2022|

The EU Commission postpones the draft of the LkSG for the third time

For the third time, the EU Commission has postponed the draft of the planned European supply chain law. The draft will therefore no longer be published this year as planned, but rather in March 2022 at the earliest. No reasons are given for the postponement. It is believed that the intervention of the “Regulatory Scrutiny Board” is responsible for this. This is a body of dubious democratic legitimation within the Commission: https://ec.europa.eu/info/law/law-making-process/regulatory-scrutiny-board_de

Numerous European civil society organizations and trade unions have therefore written an open letter to EU Commission President Ursula von der Leyen. There it says among other things:

“Despite your promise to come up with a ‘solid and balanced’ proposal in 2021, press reports have warned us that the SCG initiative is being further delayed. It is unacceptable that such an important new law, which can help millions of people demand justice against human rights abuses and help protect our environment and the climate, be postponed for the third time.

We are also deeply concerned about the total lack of transparency about the reasons for this new delay. The uncertainty about the fate of the legislation is very harmful to people suffering from irresponsible corporate behavior and to the environment. This inexplicable delay risks undermining the trust that European citizens, local and international civil society and trade union organizations, workers and victims of corporate abuse have placed in the EU to regulate sustainable and responsible business in the wake of the COVID pandemic and the climate and Biodiversity crisis. “

Please refer:

December 10th is Human Rights Day. We would have liked to have been able to announce news from the EU that day promising increasing protection of human rights. It is therefore all the more important to support initiatives that campaign for human rights around the world, such as XertifiX or the Supply Chain Act initiative .

2021-12-15T10:54:38+01:00December 10th, 2021|

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