Supply Chain Due Diligence Act: European Parliament votes for weakening

Now it's Out! EU Parliament for the Relaxation of the So-Called Supply Chain Act

2025-12-17 Source: dpa 1 min Reading Time

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The European Parliament has agreed to a weakening of the demands in the Supply Chain Due Diligence Act for companies ...

In order to ensure that such a sight is hardly seen anymore, the EU introduced the Supply Chain Due Diligence Act. However, companies were not really in favor of it. Now the European Parliament has voted to significantly weaken it.(Image: Unicef) — In order to ensure that such a sight is hardly seen anymore, the EU introduced the Supply Chain Due Diligence Act. However, companies were not really in favor of it. Now the European Parliament has voted to significantly weaken it.
(Image: Unicef)

The aim of the Supply Chain Due Diligence Act is to strengthen human rights worldwide and, if necessary, hold large companies accountable if they benefit from human rights violations such as child or forced labor. However, the previous demands were sharply criticized, among other things, due to the high bureaucratic effort. It seems there was a realization, as now a clear majority of Members of the European Parliament in Strasbourg has voted for a corresponding compromise that had previously been negotiated by parliamentary and EU state negotiators. The regulations will therefore in the future only apply to a few large companies. The EU states must still officially agree to the amendment, which, however, is considered more of a formality, as further stated.

Only Relatively Large Companies Are Still Obligated

Specifically, large companies with over 5,000 employees and an annual turnover of at least $1.76 billion will still be affected by the law, as it is reported. Originally, the thresholds were set at 1,000 employees and a turnover limit of $526.5 million. According to information from Jörgen Warborn, the lead negotiator for the EU Parliament, around 85 percent of the companies that were originally subject to the regulations will no longer fall under them. Estimates suggest that around 1,500 companies will still be affected. Under the simplified rules, those who now violate the requirements will not be subject to civil liability at the EU level, which also removes the possibility for victims of human rights violations to file lawsuits. The potential offenders are instead to face a maximum fine of three percent of their global net turnover. Additionally, there will no longer be an obligation to develop action plans for climate targets. Looking back, the political debates on how to proceed were heated. Chancellor Friedrich Merz (Germany) even advocated for abolishing the law entirely.

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Date: 08.12.2025

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