Ministers of European Union member states gave final approval on Friday to a much-debated law requiring companies to protect human rights in their supply chains.
The Corporate Sustainability Due Diligence Directive – also known as the European Supply Chain Act – is intended to hold large companies liable if they benefit from child or forced labor outside the EU.
No member state voted against the law, but ten abstained, including Germany. It took significant diplomatic efforts to get the law passed. It was especially controversial within Germany’s coalition government, where the liberal Free Democratic Party feared that the business community would become overburdened.
An initial deal with the European Parliament, brokered by Spain last year, did not receive enough support from member states. The new deal approved on Friday and negotiated by Belgium increases the threshold at which companies will fall under the new rules.
