The trend of introducing mandatory supply chain due diligence in the EU
Various supply chain due diligence schemes already govern the placing of goods on the EU market, and several more are currently being adopted by the two EU co-legislators, the Council of the EU (consisting of the member states) and the European Parliament (consisting of directly elected representatives). Schemes that are already in force include the Conflict Minerals Regulation (in force from January 2021); the Timber Regulation (in force from March 2013); the Forest Law Enforcement, Governance and Trade (FLEGT) Regulation (in force from December 2005); and the Kimberley Process Certification Scheme for conflict diamonds (in force from December 2002). Others that are at various stages of adoption and will enter into force in the coming years include the Carbon Border Adjustment Mechanism (CBAM) Regulation, the Deforestation-free Regulation, the Forced Labour Regulation, the Batteries Regulation. All of these schemes have one important thing in common: they all require importers to know how the products they place on the EU market were manufactured and to be able to present documentary evidence upon request to demonstrate it. This evidence must be obtained from suppliers or from the suppliers’ own suppliers. We will review each of these various schemes in a series of client alerts. This is the second alert, focusing on the Forced Labour Regulation. See our previous alert on the Due Diligence Directive.
In her State of the Union speech in September 2021, Commission President Ursula von der Leyen announced the Commission’s intention to propose a ban on products in the market that have been made with forced labour. The Commission initially considered including the ban on products made with forced labour in the Due Diligence Directive proposal (DD proposal), which was announced in February 2022, but it eventually decided to work on a separate legal instrument dedicated exclusively to forced labour.