The complete list of national Human Rights Due Diligence laws

Over the past few years, more and more countries have started to adopt mandatory Human Rights Due Diligence (HRDD) laws – affecting both domestic and foreign businesses operating in the country. Although businesses have been encouraged to take responsibility for their supply chains for several decades now, recent research shows that a voluntary approach is not enough to protect the environment and poor working conditions in multi-tier supply chains.

As a result, governments around the world are beginning to make the necessary changes needed on the legal level to ensure that companies are being held responsible for the happenings down their supply chains.

In this blog, we have gathered all the new and upcoming due diligence laws and legislative proposals you should know about. Find out whether or not your company is affected and what you have to do to comply. Let’s have a look!

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New human rights due diligence laws are emerging worldwide – watch our popular Human Rights Due Diligence webinar here to find out how this rapidly changing landscape affects businesses.

1. European Commission’s proposal on a Directive on Corporate Supply Chain Due Diligence

In February 2022, the EC proposed a union-wide Directive on Corporate Supply Chain Due Diligence to better identify and mitigate risks lurking in EU companies' value chains. The proposal's ultimate purpose is for companies to systematically exercise due diligence practices and thus make more data available on their human rights and environmental adverse impacts.

The proposal suggests that the Directive should be based on the existing OECD Due Diligence Guidance for Responsible Business Conduct, as well as the UN’s Guiding Principles on Business and Human Rights framework.

Which companies does the EU's Corporate Sustainability Due Diligence proposal apply to?

EU Companies with more than 500 employees and over 150 million EUR turnover worldwide;
Large EU companies with more than 250 employees and over 40 million EUR turnover worldwide in the following high-risk sectors: agriculture, garment, and minerals;
Large non-EU companies with over 40 million EUR turnover in the EU in the following high-risk sector: agriculture, garment, and minerals;
SMEs, including micro companies, are excluded from the due diligence duty due to the heavy reporting burden. They will, however, still be exposed to some of the costs and burdens through business relationships with in-scope companies as large companies are expected to pass on demands to their suppliers.

Material scope (i.e. what is covered) by EU’s Corporate Supply Chain Due Diligence proposal

Human rights;
Labor rights;
Environmental.

What are the requirements of EU’s Corporate Supply Chain Due Diligence proposal?

Integrate due diligence into the company’s policy and strategy;
Establish a code of conduct for this purpose;
Set up a strategy to identify potential and actual impacts;
Company directions are obliged to put in place and oversee the due diligence process;
Companies subjected to EU CSRD: Publish the due diligence strategy annually;
Companies not subject to EU CSRD: Publish an annual statement.

2. France’s Corporate Duty of Vigilance Law (Loi de Vigilance)

In 2017, France adopted a law obligating large companies to carry out human rights and environmental due diligence and publish a Vigilance Plan annually. The law was adopted to ensure that French, large companies are taking the measures needed to identify and prevent human rights and environmental violations in their supply chains.

Which companies does the French Corporate Duty of Vigilance Law apply to?

French companies with more than 5.000 employees worldwide;
Non-french companies operating in France with more than 10.000 employees worldwide.

Material scope of the French Corporate Duty of Vigilance Law

Human rights;
Health and Safety;
Environment.

What are the requirements of the French Corporate Duty of Vigilance Law?

Establish and effectively implement a vigilance plan that includes:

(i) risk mapping: identification, analysis, and ranking of potential risks;
(ii) steps implemented to address, mitigate and prevent risks and violations;
(iii) outline of procedures implemented for periodically assessing the company’s subsidiaries, subcontractors, and supplier’s compliance;
(iiii) a method for identifying existing or potential risks in cooperation with relevant trade unions;

A monitoring scheme to follow up on the measures implemented and assess their efficiency;
Public the vigilance plan annually.

3. Germany's Supply Chain Due Diligence Law (LkSG)

In January 2023, Germany’s Supply Chain Due Diligence act (the LkSG) will come into
force – making it mandatory for larger businesses in Germany to conduct supply chain risk analyses to better understand risks and violations in global supply chains.

Which companies does Germany’s Supply Chain Due Diligence Law apply to?

From 2023: Businesses domiciled or selling goods and services in Germany with 3000 or more employees.
From 2024: Businesses domiciled or selling goods and services in Germany with 1000 or more employees.

Material scope of Germany’s Supply Chain Due Diligence Law

Human rights;
Labor rights;
Environmental (Stockholm, Minamata, and Basel convention standards only)

What are the requirements of Germany’s Supply Chain Due Diligence Law?

Establish a risk management system;
Designate a responsible person within the company;
Perform regular risk analyses and preventive measurements in own operations, subsidiaries, direct suppliers, and indirect suppliers;
Establish a complaints mechanism and take remedial action;
Publish progress reports on the website and submit them to the relevant authority annually.

4. Norway’s Transparency Act

The Norwegian transparency act entered into force in July 2022, obligating in-scope companies to conduct human rights and decent work due diligence and follow-ups in their supply chains and business relationships – and to communicate their findings externally.

Which companies does Norway’s Transparency act apply to?

Companies domiciled in Norway and foreign companies selling in the construed that exceeds the threshold for at least two of the three criteria:

An annual turnover of at least 70 million NOK;
Balance of at least NOK 35 million NOK; or
An average number of 50 full-time employees or the equivalent annual man-hours

Material scope of Norway’s Transparency Act

Human rights;
Labor rights.

What are the requirements of Norway’s Transparency Act?

Embed responsible business conduct into the company’s policies;
Identify and implement measures to cease, prevent and mitigate impacts based on risk prioritization;
Track implementation and results;
Transparently inform consumers or anyone interested upon request;
Annually publish reports on the due diligence assessments on the company’s website no later than the 30th of June each year.

5. Netherland’s Due Diligence Legislation – the Responsible Business Conduct

In addition to the Child Labour Due Diligence Law, which came into effect in mid-2022, the Dutch government has recently proposed a new, broader law, obliging both human and environmental due diligence. The draft of the law is currently expected under process and is expected to be finalized in 2022.

Which companies does the Netherlands’ Responsible Business Conduct apply to?

Dutch companies and non-dutch companies operating in the Netherland exceed the threshold for at least two of the three criteria:

An annual turnover of at least 40 million EUR;
Balance of at least 20 million EUR; or
Over 250 employees.

Material scope of Netherland’s Responsible Business Conduct

Human rights;
Labor rights;
Environment.

What are the requirements for Netherland’s Responsible Business Conduct?

Integrate due diligence into the company’s policies and business processes;
Identify and analyze real and potential impacts;
Set ut and carry out an action plan to prevent and mitigate impacts through prioritizing risks;
Monitor the effectiveness of measurements in place;
Set up a remediation process or cooperate with an existing one;
Annually report on the company’s due diligence process – including findings and results.

6. Motion Austrian Supply Chain Act

In 2021, a motion for a supply chain act was presented in the Austrian parliament, aiming to make the necessary changes on a legal level to ensure that companies are taking responsibility for what is happening within their supply chains.

Which companies does the Austrian Supply Chain Act apply to?

All Austrian and non-Austrian companies operating in Austria. A minimum turnover has yet to be defined.

Material scope of the Austrian Supply Chain Act

Human rights;
Labor rights;
Environment.

What are the requirements of the Austrian Supply Chain Act?

Carry out due diligence at least annually;
Publish a report annually reports on the progress;
Conduct risk analysis;
Follow-up measures to stop and prevent adverse impacts in its entire global supply chain, own operations, subsidiaries, and subcontractors;
Regular effectiveness reviews on the measurements in place;
Set up an early warning system appropriate to the size of the company

7. UK Modern Slavery Act

In 2015, the UK government introduces the Modern Slavery act, which requires in-scope companies to prepare and publish a modern slavery and human trafficking transparency act every financial year. In 2018, the companies affected by the legislation were also required to register on the government’s Moderns Slavery Contact Database to get more guidance and resources on producing a modern slavery statement.

Which companies does the UK Modern Slavery Act apply to?

Any company carrying out some or all of its business in the UK with a global turnover of 36 million GBP.

Material scope of the UK Modern Slavery Act

Human rights;
Labor rights.

Requirements of the UK Modern Slavery Act

Prepare and publish a slavery and human trafficking statement for each financial year. The statement must disclose:

(i) the steps the organization has taken the financial year to ensure that modern slavery and human trafficking are not taking place in any of its supply chains or own operations; or
(ii) that the organization has not taken such steps

8. Canada Forced Labor Bill (BILL S-211)

In late 2021, the Minister of Labor announced the introduction of legislation aimed to increase transparency into Canadian businesses' global supply chains to identify and eradicate forced and child labor. The bill was passed by the Senate on April 2022 and is expected to come into force on January 1 of the year following the year in which it receives royal assent.

Which entities does Canada’s Forced Labor Bill apply to?

Government institutions; and
Private entities that produce, sell or distribute goods, or import goods into Canada that meet at least two of the three conditions:

(i) has at least 20 million CAD in assets;
(ii) the entity has generated at least 40 million CAD in revenue; or
(iii) the entity employs an average of at least 250 employees.

Material scope of the Canadian Forced Labor Bill

Labor rights;
Children’s rights.

What are the requirements of Canada’s Forced Labor Bill (Bill S-211)?

Annually report on the entity’s process and achievements;
Information required in the reports includes; the entity’s due diligence processes, the relevant training provided to its employees, and an assessment of the effectiveness of the processes in place to ensure forced and child labor are not present in its business and supply chains;
Make the report available on the entity’s website, and if the entity is incorporated under the Canada Business Corporations Act, it is also required to distribute it to each shareholder.

9. Uyghur Forced Labor Prevention Act

In June 2022, the Uyghur Forced Labor Prevention Act (UFLPA) came into force, requiring companies that source material from the Xinjiang region in China to prove that their supply chains are not tainted with forced labor if they want to import their goods into the US.

Which companies does the Uyghur Forced Labor Prevention Act apply to?
The act will primarily target companies in the four following high-risk sectors:

Apparel
Cotton and cotton products;
Tomatoes and downstream products;
Silica-based products (including polysilicon)

Material scope of the Uyghur Forced Labor Prevention Act

Labor rights;
Human rights.

What are the requirements of the Uyghur Forced Labor Prevention Act?

Exercise human rights due diligence and supply chain tracing to prove that goods were not sourced from Xinjiang, or, if they are from the region, that they were not produced with forced labor;
Provide supply chain traceability documents from the entire supply chain from the origin to the final product;
A complete list of all the workers at entities subjected to the rebuttable presumption;
Proof that workers were not subject to forced labor practices.

10. Belgian Due Diligence Law proposal

In April 2021, the Federal Parliament voted in favor of a Belgian due diligence law proposal – thus taking the first steps to strengthen the obligations of companies to take control of their supply chains. The law aims for companies to set up a vigilance plan to identify and prevent human rights violations and mitigate social and environmental risks in their supply chains and subsidiary companies.

11. Australia’s Modern Slavery Act

Australia’s Modern Slavery Act came into force in 2019, requiring larger companies in Australia to publicly report on how they are preventing and addressing risks related to modern slavery in their operations and supply chains.

Material scope of Australia’s Modern Slavery Act

Human rights;
Labor rights.

Which companies does Australia’s Modern Slavery Act apply to?

Australian companies or companies operating in Australia with annual total revenue of more than 100 million AUD.

What are the requirements of Australia’s Modern Slavery Act?

Annually prepares and submits a statement on what actions are taken to prevent and address modern slavery in the company’s supply chain or own operations. Each statement must address the following seven mandatory criteria:

identify the reporting entity;
describe the reporting entity’s structure, operations, and supply chains;
describe the risks of modern slavery practices in the operations and supply chains of the reporting entity and any entities it owns or controls;
describe the actions taken by the reporting entity and any entities it owns or controls to assess and address these risks, including due diligence and remediation processes;
describe how the reporting entity assesses the effectiveness of these actions;
describe the process of consultation with any entities the reporting entity owns or controls (a joint statement must also describe consultation with the entity giving the statement); and
provide any other relevant information.

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This piece is based on the European Coalition for Corporate Justice's comparative table on due diligence laws and legislative proposals in Europe

The complete list of national Human Rights Due Diligence laws – who’s affected and how to comply