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Netherlands: Four political parties launch legislative proposal for mandatory due diligence in Parliament

Today, four political parties submitted a bill on Responsible and Sustainable International Business Conduct in Dutch parliament...

The legislative proposal of the four parties (ChristenUnie, GroenLinks, PvdA, SP) imposes a duty of care on all companies in the Netherlands to address human rights violations and environmental damage in their value chains. Companies with more than 250 employees will be obliged to implement the six steps of due diligence, in line with the OECD Guidelines. The law will be enforced by a public regulator, which can issue financial sanctions. Repeated failure within five years to stop activities that cause or contribute to negative impacts or to provide remedy will be considered a criminal offence, punishable by fines and jail. The bill also enables third parties to hold companies liable in civil court for harms suffered as a result of a violation of the law. If adopted, the law would replace the Child Labour Due Diligence Law, which was passed by the Senate in 2019...

There is strong support for legislation on responsible business conduct in the Netherlands, both in civil society and in the business community. Over 125 companies, civil society organisations, trade unions, religious organisations and academics support the Initiative for Sustainable and Responsible Business Conduct (IDVO), which advocates the introduction of corporate accountability legislation in the Netherlands. The business association MVO Nederland, with over 2,000 members, and a group of 50 companies also spoke out in favour of national legislation, as well as several large and small companies in Dutch media. In September 2020, the Dutch Social and Economic Council advised the government to introduce binding rules for responsible business conduct.

The MVO Platform welcomes the bill and hopes it will receive wide political support after the general elections in the Netherlands next week... The Dutch government has expressed its preference for legislation at the EU level, but is also preparing ‘building blocks’ for national legislation in case of insufficient progress or ambition at the EU level.

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