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ARTICLE · 11 OCTOBER 2023

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The German Supply Chain Due Diligence Act

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The German Supply Chain Due Diligence Act (Lieferkettensorgfaltspflichtengesetz) imposes obligations to companies for responsible business conduct in supply chains.

GermanyCorporate/Commercial Law
GEMS Schindhelm
GEMS Schindhelm

What is The German Supply Chain Due Diligence Act?

The German Supply Chain Due Diligence Act (Lieferkettensorgfaltspflichtengesetz) imposes obligations to companies for responsible business conduct in supply chains.

The act obligates companies to identify and address potential human rights and environmental risks in their supply chains, implement preventive and remedial measures, establish complaints mechanism, and regularly report the findings. Even if it is not possible to prevent a violation, companies must minimize or mitigate the risks.

The German government published a National Action Plan for Business and Human Rights after the release of the UN Guiding Principles on Business and Human Rights. Some of the companies implemented voluntary measures according to The National Action Plan. However, those voluntary measures were not sufficient or enough to cover the business practices which the UN Guide aims therefore The German Supply Chain Due Diligence Act

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