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Legal | Zoom on the 'Supply Chain Due Diligence Act'

Updated: Sep 12, 2023

In line with the ongoing trend in Europe, a new legislation that will require companies to conduct supply chain due diligence activities is making news in Germany. It's time to anticipate and get prepared.

Voted on June 9, 2021 by the German Parliament, the 'Supply Chain Due Diligence Act' will apply to German companies and German branches of foreign groups.

The law requires companies to set up processes to monitor their own operations and their supply chain’s compliance with labour, health and safety and environmental legislation, and to conduct risk assessment.

In contrast to current legislations, this law will be accompanied by a legal arsenal that can lead, in addition to fines, to a 3-year ban on any public offer of purchase in Germany.

Although many of the impacted companies are still hoping for a reduction in the constraints introduced by this law, its application is planned for January 2023 and will initially concern all German companies with at least 3,000 employees (then 1,000 employees from January 2024).

End-to-end traceability is one of the main keys to build a responsible sourcing system. The good news is our blockchain-based traceability platform can help make a difference to collect traceability & impact data in real time and end-to-end, to secure this data and consolidate accountability of each actor in the value chain, to prove claims, and finally to link this information together for each product, each batch, and return it as required by regulations and authorities.


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