How German Law on Due Diligence Will Affect Obligations of Serbian Suppliers

According to the German Law on Due Diligence in supply chains, the implementation of which started on January 1, 2023, all Serbian companies which belong to the supply chains of German companies must establish risk management by which they will meet a range of requests in the fields of human rights protection and ecology.

– In order to adapt as easily as possible to the demands of the foreign suppliers, the Chamber of Commerce of Serbia (CCIS), in cooperation with the German International Cooperation (GIZ) will launch, in the first quarter of this year, a “help desk” (Responsible Business Hub) for advising companies. We will work on creating a network of strategic partners and consultants, and in the coming period, the CCIS will also organize a range of seminars, events and consultation directed at raising awareness and inciting dialogue between the interested parties about the German law on supply chains and the upcoming EU regulation – wrote Tanja Lindell, Deputy Manager at the Industry Department at the CCIS.

The law pertains to both companies registered in Germany and their daughter companies abroad, as well as to direct and indirect suppliers in their supply chains.

The demands put before the suppliers pertain to a ban on child labor, a ban on forced labor and discrimination, the right to the possibility of association and an adequate wage, a ban on the counter-legal confiscation of land and a ban on the misuse of private security.

In the field of environmental protection, the law proscribes adherence to three international conventions – the Minamata Convention on Mercury, the Stockholm Convention on Persistent Organic Pollutants and the Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and Their Disposal.

The law pertains only to product and service supply chains, and not to the export of final products by Serbian companies to the German market.

This act is only the introduction and preparation for the EU directive, which is already being prepared and which will be adopted in the coming period. This directive will have even stricter requirements when it comes to the protection of human rights and ecological due diligence. The law pertains to companies which have their headquarters or a branch office in Germany and which employ over 3,000 workers in Germany, and from January 1, 2024, it will apply to all companies which employ over 1,000 workers in Germany.

German companies will use the first part of 2023 to adapt their procedures, and Serbian companies are expected to get requests from their German partners in the second half of this year, which they are supposed to meet in line with the stipulations of this act.

Every company which is currently part of the supply chain of a German company, if it wants to continue cooperation with its partner, will need to meet the obligations defined by this act, and the same pertains to companies which are in negotiations and which are planning cooperation with a German company.

Privredna komora Srbije

GIZ Beograd

CCIS

German International Cooperation

GIZ

Tanja Lindell

Stockholm

Minamata

Law on Due Diligence

ban on child labor

ban on forced labor

ban on discrimination

Stockholm convention

due diligence