Nachrichten & Pressemeldungen - © FEMNET 12 February 2021 Supply Chain Law is Coming! - but with compromises The supply chain law is coming, that's for sure. A positive move, as the law can be passed before the upcoming federal election this year. As a result, companies are obliged to take responsibility for human rights and the environment. Violations should be controlled by a federal agency. If an undertaking breaches its obligations, the authority may impose fines and exclude the undertaking from public contracts. This is, after all, a step forward from the previous voluntary approaches. However, the effectiveness of the law remains questionable. Minister of Economic Affairs Peter Altmaier was able to enforce his demands and invalidate the law in important places: The central element of civil liability is waived. This prevents victims of human rights violations from suing the responsible companies in German courts. Above all, however, it does not cover the entire supply chain, but only the immediate supplier. This can be a middleman or a ready-to-wear factory, e.g. in Bangladesh. But the ‘indirect’ suppliers in the deeper supply chain, such as spinning mills, are not taken into account. This is a so-called graduated duty of care. This is also contrary to the UN Guiding Principles. If the law comes into force from 2023, it should initially only apply to companies with more than 3,000 employees (that's around 600 companies in Germany). As of 2024, the law will target companies with more than 1,000 employees, which is 2,891 companies, according to the Ministry of Labour. As a result, small and medium-sized companies with more than 250 employees - and this affects numerous companies in the clothing industry - fall through the grid. There is also no reference to the demand for a gender-responsive supply chain law, which FEMNET and other NGOs have always called for. Even if the law has significant gaps, it shows that the effort was worthwhile. Together with many other actors, we have managed to get politicians to dedicate themselves to the topic and to put a law on the way. Now the hope rests on the parliamentarians to improve the draft. The EU could lead the way.
