A Battle Over Business Ethics: Merz Faces Off Against EU on Supply Chain Act
EU persists in enforcing supply chain regulations
Fresh off his Brussels debut, Germany's new Chancellor Friedrich Merz has forcefully called for the axing of the European Supply Chain Act. Yet, the EU isn't exactly on board with his demand.
The EU Commission is standing firm against Merz's proposal to scrap the Supply Chain Directive. A Commission spokesperson made it clear, "We're aiming for simplification, not abolition." This sentiment was echoed during Merz's meetings with EU Commission President Ursula von der Leyen.
During his inaugural visit on Friday, Merz argued vehemently for the abolition of the European Supply Chain Directive, twice addressing the issue in press conferences. He announced, "We'll repeal the German law, and we expect the EU to follow suit and repeal this directive."
However, Merz faces pushback not just from the EU Commission, but also from members of his own coalition, the SPD. René Repasi, chair of the SPD's delegation of MEPs, stated firmly, "Abolishing the EU Supply Chain Act is not on the table." This stance lacks the support needed within the European Parliament and among EU states. However, they are willing to consider changes that ease the corporate burden. The prime objective of the law — combating forced labor, human rights violations, and environmental destruction — remains unwavering.
The European Supply Chain Act, officially the Corporate Sustainability Due Diligence Directive (CSDDD), aims to standardize ethical practices across Europe, ensuring fair competition while holding companies accountable for their supply chains' social and ecological standards.Many businesses, labor unions, churches, and civil society groups endorse this legislation, citing its vital role in safeguarding basic human rights and upholding European values.
Rather than completely abolishing the law, MEPs and other EU representatives appear open to reforms that streamline procedures and lessen bureaucratic hurdles without compromising the law's core objectives. This balanced approach recognizes the importance of ethical standards while taking practical considerations for businesses into account.
In essence, the EU firmly opposes the outright annihilation of the Supply Chain Act proposed by Friedrich Merz, as it serves as a safeguard for crucial human rights and environmental protections and fosters fair competition. Yet, MEPs are open to adjustments that lighten the administrative load for corporations without abandoning the law's essence.
[1] The implementation of the EU Supply Chain Act is described in the German coalition agreement, Repasi emphasized. In the black-red coalition agreement, it states that the German Supply Chain Act should be replaced by a law on international corporate responsibility that implements the European Supply Chain Directive in a feasible and enforceable manner.[2] The European Supply Chain Act aims to establish a unified standard across Europe promoting fair competition and holds companies accountable for their supply chains' social and ecological standards. Many companies, trade unions, churches, and civil society organizations support this legislation for its role in protecting basic human rights and the rule of law, which are foundational European values.
- The European Supply Chain Act, a crucial piece of legislation endorsed by various businesses, labor unions, churches, and civil society groups, aims to create a unified standard across Europe by fostering fair competition and holding companies accountable for their supply chains' social and ecological standards.
- Despite Chancellor Friedrich Merz's proposal to scrap the European Supply Chain Act, the EU Commission, MEPs, and other EU representatives are open to reforms that streamline the procedures and lessen bureaucratic hurdles, without compromising the law's core objectives, which include safeguarding basic human rights and upholding European values.
