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New obligations for supply chain companies


​by Karolina Sieraczek

9 May 2023

The EU legislator is placing increasing importance on all supply chain players adhering to due diligence standards. This applies to entities based both inside and outside the EU.

The term ‘supply chain’ covers a range of players involved in the supply process, in particular component and machinery suppliers, mineral suppliers, as well as logistics, production, and sales companies.

The aim of these measures is to boost the protection of human rights by imposing new control obligations on companies towards their suppliers and their sub-suppliers.

Environmental protection

Another issue highlighted by the EU legislator is environmental protection. This is an area that needs to be secured and where the responsibility of companies for the negative impacts of their business needs to be extended. 

Directive on corporate sustainability due diligence

Germany pioneered the implementation of the supply chain directive (Supply Chain Act). The Supply Chain Act has been in force in Germany since 1 January 2023. 

Effective 1 January 2024, the list of entities subject to the obligations under the Act will be expanded to include companies with at least one thousand employees. This means that more and more companies will be required to implement measures to control or analyse risks related to their business partners. Negative results of the verification might lead to the need to terminate existing contracts.

To read more about the Supply Chain Directive click here: Insights: International Supply Chains

Further regulatory proposals are currently being adopted in this area, such as the Corporate Sustainability Due Diligence Directive. This means that more and more measures will be taken to ensure compliance with labour and environmental standards, among other things.  

It is already worthwhile to develop control and prevention procedures in line with the new regulations and to introduce appropriate provisions in your contracts. Contact us and we will help you ensure regulatory compliance within your organisation.


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Karolina Sieraczek

Attorney at law (Poland)

Associate Partner

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