Germany adopts the supply chain due diligence act
On the 11th of June 2021, the German parliament adopted the Supply Chain Due Diligence Act which requires large German companies to exercise due diligence in relation to a defined list of human rights and certain environmental standards in their own operations and the activities of ‘direct’ suppliers. With respect to “indirect” suppliers, a due diligence obligation exists only to the extent that the company obtains ‘substantiated knowledge’ of a possible violation or is otherwise prompted by other circumstances. In terms of enforcement, the law provides that the German Federal Office for Economic Affairs and Export Control is responsible for enforcing the law. Public authorities can investigate cases of non-compliance and issue fines.
Norwegian Parliament adopted the Transparency Act
On 10 June 2021, Norway adopted the Act on business transparency and work with fundamental human rights and decent work (‘Transparency Act’) which is set to enter into force in January 2022 (1). The law creates a corporate duty for large and medium-sized companies domiciled in Norway as well as foreign companies selling products and services in Norway, to conduct due diligence in relation to human rights and decent work throughout all their supply chain, and to provide or cooperate to ensure remedy. The law also requires companies to report on their due diligence exercise and grants a ‘right to information’ to any interested stakeholder the right to request information from companies in this respect. As for the enforcement, the law provides that the Norwegian consumer authority shall be responsible for monitoring compliance with the law and providing guidance to the company, and may issue injunctions and impose fines in case of non-compliance.
(1) Act on business transparency and work with fundamental human rights and decent work (also known as the ‘Transparency Law’), Proposition 150 L (2020-2021), available (in Norwegian) at: www.regjeringen.no
U.S. Supreme Court decides in favour of Nestlé and Cargill in child slavery case
The lawsuit had been filed under the Alien Tort Statute (ATS) – an 18th century statute which provides US federal courts jurisdiction to hear claims against non-US defendants – by six Malian nationals against Cargill Inc and Nestle SA over claims that they were trafficked as child slaves to Ivory Coast and forced to work on cocoa farms. On the 17th of June 2021, the Supreme Court reversed the decision from the Court of Appeals for the 9th Circuit – which had allowed the claim to proceed – and rejected the claim on the grounds that nearly all conduct had taken place outside of the US and that there was no basis for such extraterritorial application of the ATS.
European Climate Law was approved
On the 24th of June 2021, the European Council approved the European Climate Law, which aimed to write into law the goal set out in the European Green Deal to achieve climate-neutrality by 2050. The Climate Law requires EU Institutions and Member States to take the necessary measures to meet the zero greenhouse gas emissions target by 2050, and includes measures to keep track of progress and adjust actions as well as a review of progress every 5 years.
Authors: Ana Carina Duarte and Rafaela Oliveira