German business associations are urging the Bundestag and the Federal Government to suspend the Supply Chain Due Diligence Act (LkSG) following the initial reading of proposed amendments in the German parliament.
The groups assert that the suggested changes are inadequate for providing companies with significant relief since the principal due diligence and documentation requirements will remain, despite some reporting obligations being eliminated and penalties reduced.
Uwe Mazura, CEO of the German Textile and Fashion Industry Association, stated, “Germany must end its national go-it-alone approach and use the current amendment to the Local Tax Code (LkSG) to deliver tangible relief. Postponing this until 2029 is not an option. We call on the Bundestag and the Federal Government to implement the necessary measures immediately.”
Under existing regulations, companies based in Germany with at least 3,000 employees—and starting January 2024, those with 1,000 or more—must disclose measures taken to prevent human rights violations and environmental harm within their operations and supply chains.
The law mandates that affected companies perform regular risk assessments at least annually, evaluating their activities as well as those of direct suppliers regarding human rights and environmental risks.
Additionally, firms must conduct ad hoc risk assessments of indirect suppliers when they have credible knowledge of potential violations.
The business associations argue that while the current amendment might relax some formal obligations, it fails to address the core due diligence burdens imposed by the Supply Chain Due Diligence Act.
In correspondence sent to both the Bundestag and the Federal Government, the associations emphasized, “Therefore, no noticeable relief is to be expected.”
They are advocating for a suspension of the national provisions under the LkSG and urging the government to quickly implement supply chain regulatory changes agreed upon at the EU level in December 2025 (Omnibus I), as indicated in the coalition agreement.
If a complete suspension cannot be achieved, the associations suggest that German requirements be aligned immediately with the European Supply Chain Directive (CSDD), applicable only to large enterprises.
They contend that it is unjust for companies not covered by European obligations to be subjected to stricter national regulations, warning that a failure to align could lead to competitive disadvantages and legal uncertainty.