MEPs on the Legal Affairs Committee adopted with 20 votes for, 4 against and no abstentions new, so-called “due diligence” rules, obliging firms to alleviate the adverse impact their activities have on human rights and the environment, including slavery, child labour, labour exploitation, biodiversity loss, pollution and destruction of natural heritage. The requirement to prevent, end or mitigate their negative effects also concerns companies’ upstream partners working in design, manufacture, transport and supply, and downstream partners, including those dealing with distribution, transport and storage.

Scope and transition plan

The rules will apply to EU and non-EU companies and parent companies with over 1000 employees and with a turnover of more than 450 million euro and to franchises with a turnover of more than 80 million euro if at least 22.5 million was generated by royalties.

Companies will also have to integrate due diligence into their policies and risk management…