August 31, 2023 | less than a minute read

Is the BAFA watering down the German Due Diligence Law?

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Mark Temme

Global Business Development Manager

Get in touch

Mark Temme

Global Business Development Manager

NGOs are deeply concerned regarding the in their eyes exclusion of financial sector from the GDDL.

On 11 August 2023 the BAFA published a handout defining the application of the law concerning German financial institutions, such as credit, investment and insurance industries. Following the BAFA definition the supply chain should not include the end customer. In that case the financial sector is not responsible for anything happening down stream, which would be in strong contrast to the original declaration of intent.

The NGO-s believe that "now the the ball is in the EU's court". The new CSDDD is being prepared at the EU level, which is intended to make financial actors more accountable. It is to be hoped, that Germany will not oppose a strong EU supply chain law within the current trilogue negotiations.

For those being able to read German, please find following the link to the BAFA handout.

Translated from German: "This supply chain legislation is in clear contradiction to the binding obligations under international law that Germany has entered into with regard to climate protection or the observance of human and environmental rights. Investments in or financing of business models in the fossil energy sector that are affected by conflict or of companies that supply weapons to states that wage wars in violation of international law or companies that profit from exploitation are still possible without restriction."