Update: German Due Diligence Act close to the finish line

After some back and forth, the government parties announced that they have reached an agreement on the last controversial issues regarding the Supply Chain Due Diligence Act. It thus seems as if the bill can be passed until the end of June. The Act shall come into force in 2023 and may become one of the most significant human rights due diligence statutes worldwide.

The bill was supposed to be finally passed in the Parliament a fortnight ago. However, following a public hearing and further debate, it was removed from the agenda at the last minute because there was still some need for discussion.

According to press reports, the new compromise will not change the basis of the government draft, which we have already reported on here and here. However, it shall now be explicitly stated that a violation of the obligations under the Act does not give rise to civil liability beyond the existing regime. It is also to be clarified that the planned due diligence obligations also apply to large German branches of foreign companies.

We will continue to monitor this legislative project as well as the parallel discussions at EU level closely on this blog as well as on our dedicated German knowhow page.