The European Parliament is preparing to make a decision, Tuesday 9 and Wednesday 10 March, on the draft legislative own-initiative report prepared by Lara Wolters (S&D, the Netherlands) on an mandatory EU-level due diligence that would compel companies to detect, prevent and reduce the social and environmental impacts of their activities throughout their supply chains.
At the end of January, the text had been adopted almost unanimously (see EUROPE 12645/4) in the Committee on Legal Affairs (JURI). But the question remains whether it will be voted so decisively in the plenary session. That’s the question.
In front of the press on Thursday 4 March, part of Parliament’s negotiating team was in any case united and confident about the outcome of the vote, even if some points are still open.
Ms Wolters was expecting about 15 amendments. At the time of going to press, 28 amendments had been brought forward.
MEP Marie Toussaint (Greens/EFA, France) explained to us on Tuesday that there had been an informal agreement between the political groups not to table many amendments in order to “maintain the general spirit of the text” adopted in the JURI Committee. The Greens/EFA group has not tabled any individual amendments.
A joint amendment by the EPP, S&D, Greens/EFA and Renew Europe groups has been drafted, in particular to clarify that companies covered by the future directive should not pass on due diligence obligations to suppliers.
For their part, the ECR and Identity and democracy groups have tabled amendments to completely exclude SMEs from the scope of the future directive. It should be noted that the ECR group has proposed that publicly funded NGOs should also be subject to this due diligence.
There is still a question mark, Ms Wolters admitted, about the possibility of applying European law in European courts in the event of damage caused by a European company in a non-Member State.
Two amendments have been tabled by the S&D, Renew Europe, Greens/EFA and The Left groups to this effect, in order to prevent companies from being able to choose the law that would be most favourable to them. In the eyes of Pascal Durand (Renew Europe, France), this provision is essential and would constitute a real “positive upheaval”.
Nevertheless, according to some of our contacts, this proposal is being met with strong opposition from the EPP, which has even threatened, at one point, to vote against the report, if it were included in the final text.
On Thursday, German MEP Axel Voss, negotiator on behalf of the EPP, indicated that he still had “some problems with some amendments”. The outstanding issues should, in his view, be settled on Monday 8 March, just before the vote. “This is just a kind of discussion on some content issue, but it is not that we are not supporting the report”, he said.
“A victory against lobbies’ mobilisation”
As the Parliament negotiating team has acknowledged, in recent days their e-mail boxes have been flooded with messages from a wide range of organisations and companies.
So much so that French MEP Manon Aubry, who is negotiating on behalf of The Left, considered at a press conference that this text was both a “victory against corporate impunity” and a “victory against lobbies’ mobilisation”.
Last week, the MEP had launched a citizens’ campaign to denounce the intensive lobbying around the text (see EUROPE 12665/28), in particular by BusinessEurope and the French Association of Private Enterprises (Afep).
“Not only are we not calling for a vote against the Parliament’s own-initiative report on the due diligence, but we support, on the contrary, a future legislative proposal from the Commission in this area, as long as it ensures the establishment of equal conditions of competition, in particular by including in its field of application companies from non-Member States supplying goods and services in Europe, and that it defines precisely the obligations to which companies will be subject in order to guarantee legal certainty”, Afep Director General François Soulmagnon provided as justification.
Several companies have already taken a public stance on this subject. This is notably the case for Adidas which has traditionally proven in favour of such an initiative. “As a company operating worldwide, we support unified standards and want to see a level playing field”, said Frank Henke, Vice President for Corporate Sustainability, at a web conference hosted by the Federation of the European Sporting Goods Industry (FESI) on Wednesday 3 March.
He nevertheless called on European legislators to remain pragmatic. “The duty to protect human rights lies first and foremost with the State. This mandatory initiative cannot replace this”, he added, in referring to the UN Guidelines on Business and Human Rights.
The ball is in the Commission’s court
Once the Parliament report is adopted, the ball will be in the court of the Commission, which is due to present legislative proposals in June. “The Commission has promised not to put our report in a drawer somewhere”, Ms Wolters said.
On Thursday, during an online conference organised by Global Witness, EU Commissioner for Justice Didier Reynders confirmed that the Commission intends to propose ambitious texts that will make a real difference on the ground, both on the duties of company directors and on due diligence in supply chains.
The Commission is currently in the process of analysing the results of the public consultation on this subject, for which it has received almost half a million responses.
In particular, it is considering how to define high-risk SMEs and whether future rules should apply to third-country companies operating in the EU. It is also examining the establishment of a regime of civil liability and administrative supervision, Mr Reynders said.
He hoped that Ms Wolters’ report would receive broad support next week in plenary session. On the same day, several civil society organisations, including Global Witness and Oxfam, also called on MEPs to vote overwhelmingly in favour of the report to send a strong signal. (Original version in French by Marion Fontana)