On the proposal for a directive of the European Parliament and of the Council on Corporate Sustainability Due Diligence and amending Directive (EU) 2019/1937
INTA-AD-737332
Committee on International Trade · Rapporteur: Barry Andrews
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The Committee on International Trade proposes amendments to the proposed directive on Corporate Sustainability Due Diligence. It lowers company size thresholds, widens the definition of the value chain, and adds financial services to high-impact sectors.¶¶¶ It requires companies to set up complaints procedures, prioritise engagement over termination of business relationships, and disengage only as a last resort. It also requires the Commission to issue guidelines and support SMEs.¶¶¶
Committee position. The Committee on International Trade calls on the Committee on Legal Affairs to take into account its amendments, which lower thresholds, broaden the value chain, add financial services to high-impact sectors, strengthen complaints procedures, and require Commission guidelines and support for SMEs.¶
Key points
- The value chain should cover a company and its business partners related to the production and supply of goods or services, including upstream and downstream partners.¶¶
- Due diligence should apply to EU companies with more than 250 employees and a worldwide net turnover of more than EUR 40 million.¶¶
- Companies with 50 employees or more and a worldwide net turnover of more than EUR 8 million in high-impact sectors should comply 2 years after the transposition period.¶
- High-impact sectors include textiles, agriculture, forestry, fisheries, food, extraction of mineral resources, and the provision of financial services.¶¶
- Third-country companies with a net turnover of more than EUR 40 million in the Union, or more than EUR 8 million but less than EUR 40 million in high-impact sectors, should be covered.¶¶¶
- Companies should prioritise engagement with business relationships and may suspend or terminate them only as a last resort, in line with responsible disengagement.¶¶¶
- Companies must establish safe, legitimate, accessible and equitable complaints procedures, allowing anonymous complaints and not precluding judicial remedies.¶¶¶
- Member States should support SMEs through dedicated websites, portals or platforms, and companies are encouraged to support SME business partners.¶
- The Commission shall issue clear and comprehensive guidelines for specific sectors and adverse impacts, and shall complement Member States' support measures.¶¶
- The Commission shall submit an implementation report no later than 5 years after entry into force, assessing the impact on SMEs and the availability of supporting tools.¶¶¶
- Violations of EU and international environmental and climate conventions, including the Paris Agreement, are added to the list of adverse environmental impacts.¶¶¶
Who is affected
- EU companies with more than 250 employees and EUR 40 million turnover, and smaller companies in high-impact sectors.¶¶¶
- Third-country companies with significant operations in the EU.¶¶¶
- SMEs, which Member States should support and companies are encouraged to support.¶
- Financial services sector, added to the list of high-impact sectors.¶
Figures and deadlines
- more than 250 employees¶¶
- EUR 40 million worldwide net turnover
- 50 employees or more¶
- EUR 8 million worldwide net turnover
- 2 years after the end of the transposition period¶
- EUR 40 million net turnover in the Union¶
- EUR 8 million but less than EUR 40 million net turnover in the Union¶
- 5 years after the date of entry into force¶