New dispute ignites over proposed supply chain law

2 Minutes

After months of negotiations between the responsible federal ministries of the economy, labour and development, an agreement was finally reached on the German supply chain law in mid-February, which aims to require companies to enforce human rights at their suppliers abroad and to require them to comply with environmental standards. The law is scheduled to come into force on 1 January 2023.

However, many believe that the German draft of the planned supply chain law does not go far enough and would exempt too many companies. In fact, small and medium-sized companies are not envisaged to be affected by the new law; rather, companies with more than 3,000 employees will be affected as of 2023 and companies with more than 1,000 employees will be affected starting in 2024. The fact that there are no plans to impose civil liability on companies has also been criticised. In particular, the Federal Ministry for Economic Affairs under Minister Altmaier is facing accusations that it has significantly weakened the original draft in these key areas in order to ensure that some kind of supply chain law could be achieved.

At a joint press conference on 12 February, Federal Ministers Heil, Müller and Altmaier announced that an agreement had been reached but the dispute flared up again just a few days later: The State Secretary for Economic Affairs, Nussbaum, is accusing the Federal Ministry of Labour led by Minister Heil of deviating from the agreements in at least two points in the draft law which was presented recently.

View article (German)