A background to Lieferkettensorgfaltspflichtengesetz –
the German Supply Chain Act
In the backdrop of growing human and environmental rights
violations, the German legislature (and increasingly other
countries) felt a need to shift from voluntary compliance to
mandatory due diligence compliance. Accordingly, German Legislature
passed Lieferkettensorgfaltspflichtengesetz, which translates to
the Act on Corporate Due Diligence Obligations for prevention of
Human Rights Violations in Supply Chain, or simply, the German
Supply Chain Act (the “GSCA”). This
enlists mandatory due diligence obligations on supply chain
entities of German companies. India being a key supply hub with a
large number of entities, directly or indirectly part of the global
supply chain, the GSCA has wide ranging impact on such Indian
entities.
