Germany: NGOs release guidance note on Supply Chain Act for communities & rightsholders
The impact of international value chains and the activities of multinational corporations on human rights and the environment has been known for a long time. This led to the adoption of the UN Guiding Principles on Business and Human Rights in 2011. However, recurring reports of human rights violations and environmental destruction in the value chains of transnational—including German—companies have increasingly led to a realization among legislators that such voluntary approaches are insufficient to ensure corporate accountability and that binding rules of human rights and environmental due diligence are needed instead.
After years of civil society activism, advocacy and litigation efforts before German courts, on 1 January 2023 a corresponding law came into force in Germany.
The purpose of this guidance note is to inform relevant stakeholders—those affected by human rights violations and environmental destruction along the transnational value chains of German companies, as well as civil society organizations in producing countries—about this new law and its possibilities. In this way, the guidance is intended to support affected persons and their stakeholders to use this new instrument as effectively as possible to promote their rights and demands.
Since the law has only recently come into force, there remains a lack of clarification from the authorities or the courts on numerous aspects, as well as reliable practical experience on how it will be implemented. This guidance is therefore based on the text of the law, the legislative materials and initial handouts from the enforcement authority in Germany. Insofar as this guidance contains cautious predictions about a practice of the administrative authority that we expect in the future, these are based on our initial practical experience through the first complaints that have been filed. They are not intended to and cannot constitute any kind of authoritative, conclusive guidance.