Germany’s New Supply Chain Act – Part 2 of 4 – Compliance
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The Act will apply to companies with their registered office or principal place of business in Germany, as well as to foreign companies that have a branch office in Germany. The Act will come into force on 1 January 2023, giving companies a transitional period to review their existing compliance systems, adapt them or establish new systems and train their employees. Non-compliance with the Act may trigger fines, reputational damage as well as public and private enforcement risks.
Read our full briefing which provides an overview on the requirements for in-scope companies as well as the risks triggered by non-compliance with the new rules.
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The German Supply Chain Due Diligence Act will enter into effect on 1 January 2023 and provides for a tighter regulatory environment on supply chain management for companies incorporated in Germany, or hav-ing subsidiaries or branches in Germany, and employing 3,000 or more people (decreased to 1,000 in 2024). These in-scope companies will have to analyse their supply chains to avoid human and environmental rights related risks and infringements. While conducting the underlying risk analysis will be difficult, non-compliance with the new rules may trigger even more severe disadvantages to in-scope companies.
A&O’s series of briefings will provide an overview on key aspects that companies doing business in Germany need to be aware of.
