106 Amendments of Linea SØGAARD-LIDELL related to 2022/0051(COD)
Amendment 103 #
Proposal for a directive
Recital 4
Recital 4
(4) The behaviour of companies across all sectors of the economy is key to success in the Union’s sustainability objectives as Union companies, especially large ones, rely on global valuesupply chains. It is also in the interest of companies to protrespect human rights and the environment, in particular given the rising concern of consumers and investors regarding these topics. Several initiatives fostering enterprises which support value-oriented transformation already exist on Union77 , as well as national78 level. __________________ 77 ‘Enterprise Models and the EU agenda’, CEPS Policy Insights, No PI2021-02/ January 2021. 78 E.g. https://www.economie.gouv.fr/entreprises/ societe-mission
Amendment 106 #
Proposal for a directive
Recital 5
Recital 5
(5) Existing international standards on responsible business conduct specify that companies should protrespect human rights and set out how they should address the protection of the environment across their operations and valuesupply chains. The United Nations Guiding Principles on Business and Human Rights79 recognise the responsibility of companies to exercise human rights due diligence by identifying, preventing and mitigating the adverse impacts of their operations on human rights and by accounting for how they address those impacts. Those Guiding Principles state that businesses should avoid infringing human rights and should address adverse human rights impacts that they have caused, contributed to or are linked with in their own operations, subsidiaries and through their direct and indirect business relationships. __________________ 79 United Nations’ “Guiding Principles on Business and Human Rights: Implementing the United Nations ‘Protect, Respect and Remedy’ Framework”, 2011, available at https://www.ohchr.org/documents/publicati ons/guidingprinciplesbusinesshr_en.pdf.
Amendment 119 #
Proposal for a directive
Recital 13
Recital 13
Amendment 122 #
Proposal for a directive
Recital 14
Recital 14
(14) This Directive aims to ensure that companies active in the internal market contribute to sustainable development and the sustainability transition of economies and societies through the identification, prevention and mitigation, bringing to an end and minimisation of potential or actual adverse human rights and environmental impacts connected with companies’ own operations, subsidiaries and valuesupply chains.
Amendment 126 #
Proposal for a directive
Recital 15
Recital 15
(15) Companies should take appropriate steps to set up and carry out due diligence measures, with respect to their own operations, their subsidiaries, as well as their established direct and indirect business relationships throughout their valuesupply chains in accordance with the provisions of this Directive. This Directive should not require companies to guarantee, in all circumstances, that adverse impacts will never occur or that they will be stopped. For example with respect to business relationships where the adverse impact results from State intervention, the company might not be in a position to arrive at such results. Therefore, the main obligations in this Directive should be ‘obligations of means’. The company should take the appropriate measures which can reasonably be expected to result in prevention or minimisation of the adverse impact under the circumstances of the specific case. Account should be taken of the specificities of the company’s valuesupply chain, sector or geographical area in which its valuesupply chain partners operate, the company’s power to influence its direct and indirect business relationships, and whether the company could increase its power of influence.
Amendment 130 #
Proposal for a directive
Recital 17
Recital 17
(17) Adverse human rights and environmental impact occur in companies’ own operations, subsidiaries, products, and in their valuesupply chains, in particular at the level of raw material sourcing, manufacturing, or at the level of product or waste disposal. In order for the due diligence to have a meaningful impact, it should cover human rights and environmental adverse impacts generated throughout the life-cycle of production and use and disposal of product or provision of services, at the level of own operations, subsidiaries and in valuesupply chains.
Amendment 133 #
Proposal for a directive
Recital 18
Recital 18
(18) The value chain should cover‘Supply chain’ means the activities related to the production of a goods or the provision of services by a company, including the development of the product or the service and the use and disposal of the product as well as the related activities of established business relationships of the company. It should encompasss well as the related activities of upstream established direct and indirect business relationships that design, extract, manufacture, transport, store and supply raw material, products, parts of products, or provide services to the company that are necessary to carry out the company’s activities, and also downstream relationships, including established direct and indirect business relationships, that use or receive products, parts of products or services from the company up to the end of life of the product, including inter alia the distribution of the product to retailers, the transport and storage of the product, dismantling of the product, its recycling, composting or landfillingof the company.
Amendment 141 #
Proposal for a directive
Recital 19
Recital 19
(19) As regards regulated financial undertakings providing loan,financing (loans and other forms of credit), or other financial services, “valueinsurance or reinsurance, “supply chain” with respect to the provision of such services should be limited to the activities of the clients receiving such services,financing (loans and other forms of credits) and of their subsidiaries thereof whose activities are linkmentioned toin the contract in question. Clients that are households and natural persons not acting in a professional or business capacity, as well as small and medium sized undertakings, an alternative investment fund (AIF) managed by an AIFM as defined in Article 4(1), point (b), of Directive 2011/61/EU or an AIF supervised under the applicable national law and UCITS in the meaning of Article 1(2) of Directive 2009/65/EC should not be considered to be part of the valuesupply chain. The activities of the companies or other legal entities that are included in the valuesupply chain of that client should not be covered.
Amendment 151 #
Proposal for a directive
Recital 20
Recital 20
(20) In order to allow companies to properly identify the adverse impacts in their valuesupply chain and to make it possible for them to exercise appropriate leverage, the due diligence obligations should be limited in this Directive to established business relationships. For the purpose of this Directive, established business relationships should mean such direct and indirect business relationships which are, or which are expected to be lasting, in view of their intensity and duration and which do not represent a negligible or ancillary part of the valuesupply chain. The nature of business relationships as “established” should be reassessed periodically, and at least every 12 months. If the direct business relationship of a company is established, then all linked indirect business relationships should also be considered as established regarding that companyon an ongoing basis, taking a risk-based approach.
Amendment 156 #
Proposal for a directive
Recital 21
Recital 21
(21) Under this Directive, EU companies with more than 500 employees on average and a worldwide net turnover exceeding EUR 150 million in the financial year preceding the last financial year and at least EUR 20 million hereof was generated in the Union should be required to comply with due diligence. As regards companies which do not fulfil those criteria, but which had more than 250 employees on average and more than EUR 40 million worldwide net turnover in the financial year preceding the last financial year whereof at least EUR 10 million hereof was generated in the Union and which operate in one or more high-impact sectors, due diligence should apply 2 years after the end of the transposition period of this directive, in order to provide for a longer adaptation period. In order to ensure a proportionate burden, companies operating in such high- impact sectors should be required to comply with more targeted due diligence focusing on severe adverse impacts. Temporary agency workers, including those posted under Article 1(3), point (c), of Directive 96/71/EC, as amended by Directive 2018/957/EU of the European Parliament and of the Council103 , should be included in the calculation of the number of employees in the user company. Posted workers under Article 1(3), points (a) and (b), of Directive 96/71/EC, as amended by Directive 2018/957/EU, should only be included in the calculation of the number of employees of the sending company. __________________ 103 Directive (EU) 2018/957 of the European Parliament and of the Council of 28 June 2018 amending Directive 96/71/EC concerning the posting of workers in the framework of the provision of services (OJ L 173, 9.7.2018, p. 16).
Amendment 165 #
Proposal for a directive
Recital 23
Recital 23
(23) In order to achieve fully the objectives of this Directive addressing human rights and adverse environmental impacts with respect to companies’ operations, subsidiaries and valuesupply chains, third-country companies with significant operations in the EU should also be covered. More specifically, the Directive should apply to third-country companies which generated a net turnover of at least EUR 150 million in the Union in the financial year preceding the last financial year or a net turnover of more than EUR 40 million but less than EUR 150 million in the financial year preceding the last financial year in one or more of the high- impact sectors, as of 2 years after the end of the transposition period of this Directive.
Amendment 170 #
Proposal for a directive
Recital 27
Recital 27
(27) In order to conduct appropriate human rights, and environmental due diligence with respect to their operations, their subsidiaries, and their valuesupply chains, companies covered by this Directive should integrateembed the company's commitment to due diligence into corporate policies and management systems, identify, prevent and mitigate as well as bring to an end and minimise the extent of potential and actual adverse human rights and environmental impacts, establish and maintain a complaints procedure, monitor the effectiveness of the taken measures in accordance with the requirements that are set up in this Directive and communicate publicly on their due diligence. In order to ensure clarity for companies, in particular the steps of preventing and mitigating potential adverse impacts and of bringing to an end, or when this is not possible, minimising actual adverse impacts should be clearly distinguished in this Directive.
Amendment 177 #
Proposal for a directive
Recital 30
Recital 30
(30) Under the due diligence obligations set out by this Directive, a company should identify actual or potential adverse human rights and environmental impacts. In order to allow for a comprehensive identification of adverse impacts, such identification should be based on quantitative and qualitative information. For instance, as regards adverse environmental impacts, the company should obtain information about baseline conditions at higher risk sites or facilities in valuesupply chains. Identification of adverse impacts should include assessing the human rights, and environmental context in a dynamic way and in regular intervals: prior to a new activity or relationship, prior to major decisions or changes in the operation; in response to or anticipation of changes in the operating environment; and periodically, at least every 12 monthson an ongoing basis, taking a risk-based approach, throughout the life of an activity or relationship. Regulated financial undertakings providing loan, credit, or other financial servicesfinancing (loans and other forms of credit) should identify the adverse impacts only at the inception of the contract. When identifying adverse impacts, companies should also identify and assess the impact of a business relationship’s business model and strategies, including trading, procurement and pricing practices. Where the company cannot prevent, bring to an end or minimize all its adverse impacts at the same time, it should be able to prioritize its action, provided it takes the measures reasonably available to the company, taking into account the specific circumstances.
Amendment 183 #
Proposal for a directive
Recital 32
Recital 32
(32) In line with international standards, prevention and mitigation as well as bringing to an end and minimisation of adverse impacts should take into account the interests of those adversely impacted. In order to enable continuous engagement with the valuesupply chain business partner instead of termination of business relations (disengagement) and possibly exacerbating adverse impacts, this Directive should ensure that disengagement is a last-resort action, in line with the Union`s policy of zero-tolerance on child labour. Terminating a business relationship in which child labour was found could expose the child to even more severe adverse human rights impacts. This should therefore be taken into account when deciding on the appropriate action to take.
Amendment 188 #
Proposal for a directive
Recital 34
Recital 34
(34) So as to comply with the prevention and mitigation obligation under this Directive, companies should be required to take the following actions, where relevant. Where necessary due to the complexity of prevention measures, companies should develop and implement a prevention action plan. Companies should seek to obtain contractual assurances from a direct partner with whom they have an established business relationship that it will ensure compliance with the code of conduct or the prevention action plan, including by seeking corresponding contractual assurances from its partners to the extent that their activities are part of the companies’ valuesupply chain. The contractual assurances should be accompanied by appropriate measures to verify compliance. To ensure comprehensive prevention of actual and potential adverse impacts, companies should also make investments which aim to prevent adverse impacts, provide targeted and proportionate support for an SME with which they have an established business relationship such as financing, for example, through direct financing, low-interest loans, guarantees of continued sourcing, and assistance in securing financing, to help implement the code of conduct or prevention action plan, or technical guidance such as in the form of training, management systems upgrading, and collaborate with other companies.
Amendment 191 #
Proposal for a directive
Recital 35
Recital 35
Amendment 195 #
Proposal for a directive
Recital 36
Recital 36
(36) In order to ensure that prevention and mitigation of potential adverse impacts is effective, companies should prioritize engagement with business relationships in the value chain, instead of terminating the business relationship, as a last resort action after attempting at preventing and mitigating adverse potential impacts without success. However, the Directive should also, for cases where potential adverse impacts could not be addressed by the described prevention or mitigation measures, refer to the obligation for companies to refrain from entering into new or extending existing relations with the partner in question and, where the law governing their relations so entitles them to, to either temporarily suspend commercial relationships with the partner in question, while pursuing prevention and minimisation efforts, if there is reasonable expectation that these efforts are to succeed in the short-term; or to terminate the business relationship with respect to the activities concerned if the potential adverse impact is severe. In order to allow companies to fulfil that obligation, Member States should provide for the availability of an option to terminate the business relationship in contracts governed by their laws. It is possible that prevention of adverse impacts at the level of indirect business relationships requires collaboration with another company, for example a company which has a direct contractual relationship with the supplier. In some instances, such collaboration could be the only realistic way of preventing adverse impacts, in particular, where the indirect business relationship is not ready to enter into a contract with the company. In these instances, the company should collaborate with the entity which can most effectively prevent or mitigate adverse impacts at the level of the indirect business relationship while respecting competition law.
Amendment 199 #
Proposal for a directive
Recital 36
Recital 36
(36) In order to ensure that prevention and mitigation of potential adverse impacts is effective, companies should prioritize engagement with business relationships in the valuesupply chain, instead of terminating the business relationship, as a last resort action after attempting at preventing and mitigating adverse potential impacts without success. However, the Directive should also, for cases where potential adverse impacts could not be addressed by the described prevention or mitigation measures, refer to the obligation for companies to refrain from entering into new or extending existing relations with the partner in question and, where the law governing their relations so entitles them to, to either temporarily suspend commercial relationships with the partner in question, while pursuing prevention and minimisation efforts, if there is reasonable expectation that these efforts are to succeed in the short-term; or to terminate the business relationship with respect to the activities concerned if the potential adverse impact is severe. In order to allow companies to fulfil that obligation, Member States should provide for the availability of an option to terminate the business relationship in contracts governed by their laws. It is possible that prevention of adverse impacts at the level of indirect business relationships requires collaboration with another company, for example a company which has a direct contractual relationship with the supplier. In some instances, such collaboration could be the only realistic way of preventing adverse impacts, in particular, where the indirect business relationship is not ready to enter into a contract with the company. In these instances, the company should collaborate with the entity which can most effectively prevent or mitigate adverse impacts at the level of the indirect business relationship while respecting competition law.
Amendment 204 #
Proposal for a directive
Recital 37
Recital 37
(37) As regards direct and indirect business relationships, industry cooperation, industry schemes and multi- stakeholder initiatives can help create additional leverage to identify, mitigate, and prevent adverse impacts. Therefore it should be possible for companies to rely on such initiatives to support the implementation of their due diligence obligations laid down in this Directive to the extent that such schemes and initiatives are appropriate to support the fulfilment of those obligations. Companies could assess, at their own initiative, the alignment of these schemes and initiatives with the obligations under this Directive. In order to ensure full information on such initiatives, the Directive should also refer to the possibility for the Commission and the Member States to facilitate the dissemination of information on such schemes or initiatives and their outcomes. The Commission, in collaboration with Member States, may issue guidance for assessing the fitness of industry schemes and multi-stakeholder initiatives.
Amendment 208 #
Proposal for a directive
Recital 39
Recital 39
(39) So as to comply with the obligation of bringing to an end and minimising the extent of actual adverse impacts under this Directive, companies should be required to take the following actions, where relevant. They should neutralise the adverse impact or minimise its extent, with an action proportionate to the significance and scale of the adverse impact and to the contribution of the company’s conduct to the adverse impact. Where necessary due to the fact that the adverse impact cannot be immediately brought to an end, companies should develop and implement a corrective action plan with reasonable and clearly defined timelines for action and qualitative and quantitative indicators for measuring improvement. Companies should also seek to obtain contractual assurances from a direct business partner with whom they have an established business relationship that they will ensure compliance with the company’s code of conduct and, as necessary, a prevention action plan, including by seeking corresponding contractual assurances from its partners, to the extent that their activities are part of the company’s valuesupply chain. The contractual assurances should be accompanied by the appropriate measures to verify compliance. Finally, companies should also make investments aiming at ceasing or minimising the extent of adverse impact, provide targeted and proportionate support for an SMEs with which they have an established business relationship and collaborate with other entities, including, where relevant, to increase the company’s ability to bring the adverse impact to an end.
Amendment 212 #
Proposal for a directive
Recital 40
Recital 40
Amendment 214 #
Proposal for a directive
Recital 41
Recital 41
(41) In order to ensure that bringing actual adverse impacts to an end or minimising them is effective, companies should prioritize engagement with business relationships in the valuesupply chain, instead of terminating the business relationship, as a last resort action after attempting at bringing actual adverse impacts to an end or minimising them without success. However, this Directive should also, for cases where actual adverse impacts could not be brought to an end or adequately mitigated by the described measures, refer to the obligation for companies to refrain from entering into new or extending existing relations with the partner in question and, where the law governing their relations so entitles them to, to either temporarily suspend commercial relationships with the partner in question, while pursuing efforts to bring to an end or minimise the extent of the adverse impact, or terminate the business relationship with respect to the activities concerned, if the adverse impact is considered severe. In order to allow companies to fulfil that obligation, Member States should provide for the availability of an option to terminate the business relationship in contracts governed by their laws.
Amendment 216 #
Proposal for a directive
Recital 42
Recital 42
(42) Companies should provide the possibility for persons and organisations to submit complaints directly to them in case of legitimate concerindications regarding actual or potential human rights and environmental adverse impacts. The complaints must be factually justified and reasonably documented. Organisations who could submit such complaints should include trade unions and other workers’ representatives representing individuals working in the valuesupply chain concerned and civil society organisations active in the areas related to the valuesupply chain concerned where they have knowledge about a potential or actual adverse impact. Companies should establish a procedure for dealing with those complaints and inform workers, trade unions and other workers’ representatives, where relevant, about such processes. Recourse to the complaints and remediation mechanism should not prevent the complainant from having recourse to judicial remedies. In accordance with international standards, complaints should be entitled to request from the company appropriate follow-up on the complaint and to meet with the company’s representatives at an appropriate level to discuss potential or actual severe adverse impacts that are the subject matter of the complaint. This access should not lead to unreasonable solicitations of companies.
Amendment 222 #
Proposal for a directive
Recital 43
Recital 43
(43) Companies should monitor the implementation and effectiveness of their due diligence measures. They should carry out periodic assessments of their own operations, those of their subsidiaries and, where related to the valuesupply chains of the company, those of their established business relationships, to monitor the effectiveness of the identification, prevention, minimisation, bringing to an end and mitigation of human rights and environmental adverse impacts. Such assessments should verify that adverse impacts are properly identified, due diligence measures are implemented and adverse impacts have actually been prevented or brought to an end. In order to ensure that such assessments are up-to- date, they should be carried out at least every 12 monthsThe assessments should be carried out on an ongoing basis, taking a risk-based approach, and be revised in-between if there are reasonable grounds to believe that significant new risks of adverse impact could have arisen.
Amendment 226 #
Proposal for a directive
Recital 45
Recital 45
(45) In order to facilitate companies’ compliance with their due diligence requirements through their valuesupply chain and limiting shifting compliance burden on SME business partners, the Commission should provide guidance on model contractual clauses.
Amendment 231 #
Proposal for a directive
Recital 48
Recital 48
(48) In order to complement Member State support to SMEs, the Commission may build on existing EU tools, projects and other actions helping with the due diligence implementation in the EU and in third countries. It may set up new support measures that provide help to companies, including SMEs on due diligence requirements, including an observatory for valuesupply chain transparency and the facilitation of joint stakeholder initiatives.
Amendment 234 #
Proposal for a directive
Recital 50
Recital 50
Amendment 237 #
Proposal for a directive
Recital 51
Recital 51
Amendment 247 #
Proposal for a directive
Recital 57
Recital 57
Amendment 255 #
Proposal for a directive
Recital 59
Recital 59
(59) As regards civil liability rules, the civil liability of a company for damages arising due to its failure to carry out adequate due diligence should be without prejudice to civil liability of its subsidiaries or the respective civil liability of direct and indirect business partners in the valuesupply chain. Also, the civil liability rules under this Directive should be without prejudice to Union or national rules on civil liability related to adverse human rights impacts or to adverse environmental impacts that provide for liability in situations not covered by or providing for stricter liability than this Directive.
Amendment 266 #
Proposal for a directive
Recital 63
Recital 63
Amendment 270 #
Proposal for a directive
Recital 64
Recital 64
Amendment 273 #
Proposal for a directive
Recital 71
Recital 71
(71) The objective of this Directive, namely better exploiting the potential of the single market to contribute to the transition to a sustainable economy and contributing to sustainable development through the prevention and mitigation of potential or actual human rights and environmental adverse impacts in companies’ valuesupply chains, cannot be sufficiently achieved by the Member States acting individually or in an uncoordinated manner, but can rather, by reason of the scale and effects of the actions, be better achieved at Union level. In particular, addressed problems and their causes are of a transnational dimension, as many companies are operating Union wide or globally and valuesupply chains expand to other Member States and to third countries. Moreover, individual Member States’ measures risk being ineffective and lead to fragmentation of the internal market. Therefore, the Union may adopt measures, in accordance with the principle of subsidiarity as set out in Article 5 TEU. In accordance with the principle of proportionality, as set out in that Article, this Directive does not go beyond what is necessary in order to achieve that objective.
Amendment 279 #
Proposal for a directive
Article 1 – paragraph 1 – subparagraph 1 – point a
Article 1 – paragraph 1 – subparagraph 1 – point a
(a) on obligations for companies regarding actual and potential human rights adverse impacts and environmental adverse impacts, with respect to their own operations, the operations of their subsidiaries, and the valuesupply chain operations carried out by entities with whom the company has an established business relationship and
Amendment 289 #
Proposal for a directive
Article 1 – paragraph 1 – subparagraph 2
Article 1 – paragraph 1 – subparagraph 2
The nature of business relationships as ‘established’ shall be reassessed periodically, and at least every 12 monthson an ongoing basis, taking a risk-based approach.
Amendment 323 #
Proposal for a directive
Article 2 – paragraph 2 – point a
Article 2 – paragraph 2 – point a
(a) generated a net worldwide turnover of more than EUR 150 million in the Union in the financial year preceding the last financial year and at least 20 million hereof was generated in the Union;
Amendment 327 #
Proposal for a directive
Article 2 – paragraph 2 – point b
Article 2 – paragraph 2 – point b
(b) generated a net worldwide turnover of more than EUR 40 million but not more thanwhereof at least EUR 150 million hereof was generated in the Union in the financial year preceding the last financial year, provided that at least 50% of its net worldwide turnover was generated in one or more of the sectors listed in paragraph 1, point (b).
Amendment 342 #
Proposal for a directive
Article 3 – paragraph 1 – point a – point iv – indent 4
Article 3 – paragraph 1 – point a – point iv – indent 4
Amendment 345 #
Proposal for a directive
Article 3 – paragraph 1 – point a – point iv – indent 9
Article 3 – paragraph 1 – point a – point iv – indent 9
Amendment 352 #
Proposal for a directive
Article 3 – paragraph 1 – point a a (new)
Article 3 – paragraph 1 – point a a (new)
(a a) “investee company” means a company in which an institutional investor or asset manager invests which cannot be considered as a controlled undertaking.
Amendment 353 #
Proposal for a directive
Article 3 – paragraph 1 – point a a (new)
Article 3 – paragraph 1 – point a a (new)
(a a) “institutional investor” means an entity as defined by Article 2(e)i of Directive 2007/36/EC [SRD2], within the scope of Article 2 of this Directive;
Amendment 356 #
Proposal for a directive
Article 3 – paragraph 1 – point a b (new)
Article 3 – paragraph 1 – point a b (new)
(a b) “asset manager” means an entity as defined by Article 2(e)i of Directive 2007/36/EC, within the scope of Article 2 of this Directive;
Amendment 367 #
Proposal for a directive
Article 3 – paragraph 1 – point e – introductory part
Article 3 – paragraph 1 – point e – introductory part
(e) ‘business relationship’ means a relationship with a contractor, subcontractor or any other legal entities (‘partner’) in the supply chain
Amendment 372 #
Proposal for a directive
Article 3 – paragraph 1 – point e – point i
Article 3 – paragraph 1 – point e – point i
(i) with whom the company has a commercial agreement or to whom the company provides financing (loans and other forms of credits), insurance or reinsurance, or
Amendment 382 #
Proposal for a directive
Article 3 – paragraph 1 – point f
Article 3 – paragraph 1 – point f
(f) ‘established business relationship’ means a direct business relationship, whether direct or indirect, which is, or which is expected to be lasting, in view of its intensity or duration and which does not represent a negligible or merely ancillary part of the valuesupply chain;
Amendment 397 #
Proposal for a directive
Article 3 – paragraph 1 – point g
Article 3 – paragraph 1 – point g
(g) ‘valuesupply chain’ means the activities related to the production of goods or the provision of services by a company, including the development of the product or the service and the use and disposal of the product as well as the related activities of upstream and downstream established business relationships of the company. As regards companies within the meaning of point (a)(iv), ‘valuesupply chain’ with respect to the provision of these specific services shall only include the activities of the clients receiving such loan, credit, and other financial servifinancing (loans and other forms of credit), insurance or reinsurances, and of otheir companies belonging to the same groupsubsidiaries whose activities are linkmentioned toin the contract in question. The value chain of such regulated financial undertakings does not cover SMEs receiving loan, credit, finIt shall not be considered part of the supply chain of companies within the meancing, insurance or reinsurance of such entities; of point (a) (iv) the following:
Amendment 403 #
Proposal for a directive
Article 3 – paragraph 1 – point g – point i (new)
Article 3 – paragraph 1 – point g – point i (new)
i) clients that are households and natural persons not acting in a professional or business capacity, as well as small and medium-sized undertakings;
Amendment 404 #
Proposal for a directive
Article 3 – paragraph 1 – point g – point ii (new)
Article 3 – paragraph 1 – point g – point ii (new)
ii) an alternative investment fund (AIF) managed by an AIFM as defined in Article 4(1), point (b), of Directive 2011/61/EU or an AIF supervised under the applicable national law;
Amendment 405 #
Proposal for a directive
Article 3 – paragraph 1 – point g – point iii (new)
Article 3 – paragraph 1 – point g – point iii (new)
iii) UCITS in the meaning of Article 1(2) of Directive 2009/65/EC.
Amendment 410 #
Proposal for a directive
Article 3 – paragraph 1 – point h
Article 3 – paragraph 1 – point h
(h) ‘independent third-party verification’ means verification of the compliance by a company, or parts of its valuesupply chain, with human rights and environmental requirements resulting from the provisions of this Directive by an auditor which is independent from the company, free from any conflicts of interests, has experience and competence in environmental and human rights matters and is accountable for the quality and reliability of the audit;
Amendment 412 #
Proposal for a directive
Article 3 – paragraph 1 – point j
Article 3 – paragraph 1 – point j
(j) ‘industry initiative’ means a combination of voluntary valuesupply chain due diligence procedures, tools and mechanisms, including independent third- party verifications, developed and overseen by governments, industry associations or groupings of interested organisations;
Amendment 425 #
Proposal for a directive
Article 6 – paragraph 4
Article 6 – paragraph 4
Amendment 425 #
Proposal for a directive
Article 3 – paragraph 1 – point o
Article 3 – paragraph 1 – point o
Amendment 435 #
Proposal for a directive
Article 3 – paragraph 1 – point p
Article 3 – paragraph 1 – point p
Amendment 445 #
Proposal for a directive
Article 4 – paragraph 1 – point a
Article 4 – paragraph 1 – point a
(a) integratingembed the company's commitment to due diligence into their policies and management systems in accordance with Article 5;
Amendment 460 #
Proposal for a directive
Article 4 – paragraph 2
Article 4 – paragraph 2
2. Member States shall ensure that, for the purposes of due diligence, companies are entitled to share resources and information within their respective groups of companies and with other legal entities in compliance with applicable competition law. Companies within scope of this directive that are part of a group may also commit to take on the responsibilities of other group members pursuant to this directive, who will then be relieved from their responsibilities, and follow the rules in its home Member State when doing so.
Amendment 462 #
Proposal for a directive
Article 5 – paragraph 1 – introductory part
Article 5 – paragraph 1 – introductory part
1. Member States shall ensure that companies integrateembed their commitment to due diligence into all their corporate policies and management systems and have in place a due diligence policy. The due diligence policy shall contain all of the following:
Amendment 495 #
Proposal for a directive
Article 6 – paragraph 1
Article 6 – paragraph 1
1. Member States shall ensure that companies take appropriate measures to identify actual and potential adverse human rights impacts and adverse environmental impacts arising from their own operations or those of their subsidiaries and, where related to their valuesupply chains, from their established business relationships, in accordance with paragraph 2, 3 and 4.
Amendment 504 #
Proposal for a directive
Article 8 – paragraph 3 – point b
Article 8 – paragraph 3 – point b
(b) where necessary due to the fact that the adverse impact cannot be immediately brought to an end, develop and implement a corrective action plan with reasonable and clearly defined timelines for action and qualitative and quantitative indicators for measuring improvement. Where relevant, the corrective action plan shall be developed in consultation with affected stakeholders;
Amendment 519 #
Proposal for a directive
Article 6 – paragraph 3
Article 6 – paragraph 3
3. When companies referred to in Article 3, point (a)(iv), provide credit, loan or other financial servifinancing (loans and other forms of credits), insurance or reinsurances, identification of actual and potential adverse human rights impacts and adverse environmental impacts shall be carried out only once before providing that service..
Amendment 527 #
Proposal for a directive
Article 6 – paragraph 4
Article 6 – paragraph 4
4. Member States shall ensure that, for the purposes of identifying the adverse impacts referred to in paragraph 1 based on, where appropriate, quantitative and qualitative information, companies are entitled to make use of appropriate resources, including independent reports and information gathered through the complaints procedure provided for in Article 9. Companies shall, where relevant, also carry out consultations with potentially affected groups including workers and other relevant stakeholders to gather information on actual or potential adverse impacts.
Amendment 531 #
Proposal for a directive
Article 6 a (new)
Article 6 a (new)
Article 6 a Prioritisation of identified actual and potential adverse impacts 1. Member States shall ensure that companies are allowed to prioritise human rights impacts and adverse environmental impacts arising from their own operations, those of their subsidiaries or those of their established business relationships identified pursuant to Article 6 for fulfilling the obligations laid down in Articles 7 or 8, where it is not feasible to address all identified adverse impacts at the same time to the full extent. 2. The prioritisation of adverse impacts shall be based on severity and likelihood of the adverse impact. Severity of an adverse impact shall be assessed based on its gravity, the number of persons or the extent the environment affected, its irreversibility, and difficulty to restore the situation prevailing prior to the impact. 3. Once the most significant adverse impacts are addressed in accordance with Articles 7 or 8 in reasonable time, the company shall address less significant adverse impacts.
Amendment 547 #
Proposal for a directive
Article 9 – paragraph 1
Article 9 – paragraph 1
1. Member States shall ensure that companies provide the possibility for persons and organisations listed in paragraph 2 to submit complaints to them where they have legitimate concerindications regarding actual or potential adverse human rights impacts and adverse environmental impacts with respect to their own operations, the operations of their subsidiaries and their value chains. The complaint must be factually justified and reasonably documented.
Amendment 556 #
Proposal for a directive
Article 9 – paragraph 2 – point a
Article 9 – paragraph 2 – point a
(a) persons who are directly affected or have reasonable grounds to believe that they mightwill be affected by an adverse impact,
Amendment 559 #
Proposal for a directive
Article 7 – paragraph 2 – point b
Article 7 – paragraph 2 – point b
(b) seek contractual assurances from a business partner with whom it has a direct business relationship that it will ensure compliance with the company’s code of conduct and, as necessary, a prevention action plan, including by seeking corresponding contractual assurances from its partners, to the extent that their activities are part of the company’s valuesupply chain (contractual cascading). When such contractual assurances are obtained, paragraph 4 shall apply;
Amendment 561 #
Proposal for a directive
Article 9 – paragraph 2 – point b
Article 9 – paragraph 2 – point b
(b) trade unions and other workers’ representatives representing individuals working in the valuesupply chain concerned which have legitimate concern,
Amendment 561 #
Proposal for a directive
Article 7 – paragraph 2 – point c
Article 7 – paragraph 2 – point c
(c) make necessary investments, such as into management or productionestablish appropriate processes and infrastructprocedures, to comply with paragraph 1;
Amendment 563 #
Proposal for a directive
Article 9 – paragraph 2 – point c
Article 9 – paragraph 2 – point c
Amendment 575 #
Proposal for a directive
Article 7 – paragraph 3
Article 7 – paragraph 3
Amendment 581 #
Proposal for a directive
Article 9 – paragraph 4 – point b
Article 9 – paragraph 4 – point b
Amendment 586 #
Proposal for a directive
Article 7 – paragraph 5 – subparagraph 1 – introductory part
Article 7 – paragraph 5 – subparagraph 1 – introductory part
As regards potential adverse impacts within the meaning of paragraph 1 that could not be prevented or adequately mitigated by the measures in paragraphs 2, 3 and 4, the company shall be required to refrain from entering into new or extending existing relations with the partner in connection with or in the valuesupply chain of which the impact has arisen and shall, where the law governing their relations so entitles them to, take the following actions:
Amendment 598 #
Proposal for a directive
Article 7 – paragraph 6
Article 7 – paragraph 6
6. By way of derogation from paragraph 5, point (b), without prejudice to paragraph 6, when companies referred to in Article 3, point (a)(iv), provide credit, loan or other financial servifinancing (loans and other forms of credits), insurance or reinsurances, they shall not be required to terminate the credit, loan or other financial servifinancing (loans and other forms of credits), insurance or reinsurance contract when this can be reasonably expected to cause substantial prejudice to the entity to whom that service is being provided.
Amendment 601 #
Proposal for a directive
Article 7 – paragraph 6 a (new)
Article 7 – paragraph 6 a (new)
6 a. This article shall not apply to institutional investors and asset managers, in so far as their investments in investee companies are concerned.
Amendment 602 #
Proposal for a directive
Article 7 a (new)
Article 7 a (new)
Amendment 618 #
Proposal for a directive
Article 15
Article 15
Amendment 622 #
Proposal for a directive
Article 8 – paragraph 3 – point b
Article 8 – paragraph 3 – point b
(b) where necessary due to the fact that the adverse impact cannot be immediately brought to an end, develop and implement a corrective action plan with reasonable and clearly defined timelines for action and qualitative and quantitative indicators for measuring improvement. Where relevant, the corrective action plan shall be developed in consultation with affected stakeholders;
Amendment 632 #
Proposal for a directive
Article 8 – paragraph 3 – point c
Article 8 – paragraph 3 – point c
(c) seek contractual assurances from a direct partner with whom it has an established business relationship that it will ensure compliance with the code of conduct and, as necessary, a corrective action plan, including by seeking corresponding contractual assurances from its partners, to the extent that they are part of the valuesupply chain (contractual cascading). When such contractual assurances are obtained, paragraph 5 shall apply.
Amendment 651 #
Proposal for a directive
Article 8 – paragraph 4
Article 8 – paragraph 4
Amendment 663 #
Proposal for a directive
Article 8 – paragraph 6 – subparagraph 1 – introductory part
Article 8 – paragraph 6 – subparagraph 1 – introductory part
As regards actual adverse impacts within the meaning of paragraph 1 that could not be brought to an end or the extent of which could not be minimised by the measures provided for in paragraphs 3, 4 and 5, the company shall refrain from entering into new or extending existing relations with the partner in connection to or in the valuesupply chain of which the impact has arisen and shall, where the law governing their relations so entitles them to, take one of the following actions:
Amendment 677 #
Proposal for a directive
Article 8 – paragraph 7
Article 8 – paragraph 7
7. By way of derogation from paragraph 6, point (b), without prejudice to paragraph 7a, when companies referred to in Article 3, point (a)(iv), provide credit, loan or other financial servifinancing (loans and other forms of credits), insurance or reinsurances, they shall not be required to terminate the credit, loan or other financial servifinancing (loans and other forms of credits), insurance or reinsurance contract, when this can be reasonably expected to cause substantial prejudice to the entity to whom that service is being provided.
Amendment 680 #
Proposal for a directive
Article 8 – paragraph 7 a (new)
Article 8 – paragraph 7 a (new)
7 a. This Article does not apply to institutional investors and asset managers, in so far as their investments in investee companies are concerned.
Amendment 683 #
Proposal for a directive
Article 8 a (new)
Article 8 a (new)
Article 8a Appropriate measures by institutional investors and asset managers to induce their investee companies to bring actual adverse impacts caused by them to an end 1. Member States shall ensure that institutional investors and asset managers take appropriate measures as described in paragraph 3 of this Article to induce their investee companies to bring actual adverse impacts that have been, or should have been identified pursuant to Article 6 to an end, in accordance with Article 2, paragraphs 2 to 6. 2. Where the adverse impact cannot be brought to an end, Member States shall ensure that institutional investors and asset managers induce their investee companies to minimise the extent of such an impact. 3. Where relevant, institutional investors and asset managers shall be required to engage with the investee company and exercise voting rights in line with Article 3g (1), point (a) of Directive 2007/36/EC [SRD2], in order to induce the management body of an investee company to bring the actual impact to and end or minimise its extent. The action sought from the investee company shall be proportionate to the significance and scale of the adverse impact and to the contribution of the investee company’s conduct to the adverse impact. 4. The actions listed in paragraph 3 shall be required insofar they are capable of achieving the objectives of due diligence, are commensurate with the degree of severity and the likelihood of the adverse impact, and reasonably available to the institutional investor or asset manager.
Amendment 692 #
Proposal for a directive
Article 9 – paragraph 1
Article 9 – paragraph 1
1. Member States shall ensure that companies provide the possibility for persons and organisations listed in paragraph 2 to submit complaints to them where they have legitimate concerns regarding actual or potential adverse human rights impacts and adverse environmental impacts with respect to their own operations, the operations of their subsidiaries and their value chainssupply chains. The complaint must be factually justified and reasonably documented.
Amendment 702 #
Proposal for a directive
Article 9 – paragraph 2 – point a
Article 9 – paragraph 2 – point a
(a) persons who are affected or have reasonable grounds to believe that they mightwill be affected by an adverse impact,
Amendment 704 #
Proposal for a directive
Article 9 – paragraph 2 – point b
Article 9 – paragraph 2 – point b
(b) trade unions and other workers’ representatives representing individuals working in the valuesupply chain concerned, which have a legitimate concern,
Amendment 708 #
Proposal for a directive
Article 9 – paragraph 2 – point c
Article 9 – paragraph 2 – point c
Amendment 720 #
Proposal for a directive
Article 9 – paragraph 4 – point b
Article 9 – paragraph 4 – point b
Amendment 732 #
Proposal for a directive
Article 10 – paragraph 1
Article 10 – paragraph 1
Member States shall ensure that companies carry out periodic assessments of their own operations and measures, those of their subsidiaries and, where related to the valuesupply chains of the company, those of their established business relationships, to monitor the effectiveness of the identification, prevention, mitigation, bringing to an end and minimisation of the extent of human rights and environmental adverse impacts. Such assessments shall be based, where appropriate, on qualitative and quantitative indicators and be carried out at least every 12 months and whenever there are reasonable grounds to believe that significant new risks of the occurrence of those adverse impacts may arise. The due diligence policy shall be updated in accordance with the outcome of those assessments.
Amendment 741 #
Proposal for a directive
Article 11 – paragraph 2 a (new)
Article 11 – paragraph 2 a (new)
The Commission shall develop simplified reporting obligations applicable to companies referred to in Article 2(1), point (b), and Article 2(2), point (b) of this Directive, and, no later than one year after the entry into force of this Directive, provide guidelines to support them in fulfilling their obligations.
Amendment 753 #
Proposal for a directive
Article 12 – paragraph 1
Article 12 – paragraph 1
In order to provide support to companies to facilitate their compliance with Article 7(2), point (b), and Article 8(3), point (c), the Commission shall adopt guidance about voluntary model contract clauses no later than one year after the entry intro force of this Directive.
Amendment 759 #
Proposal for a directive
Article 14 – paragraph 1
Article 14 – paragraph 1
1. Member States shall, in order to provide information and support to companies and the partners with whom they have established business relationships in their valuesupply chains in their efforts to fulfil the obligations resulting from this Directive, set up and operate individually or jointly dedicated websites, platforms or portals. Specific consideration shall be given, in that respect, to the SMEs that are present in the value chains of companies.
Amendment 775 #
Proposal for a directive
Article 15
Article 15
Amendment 801 #
Proposal for a directive
Article 17 – paragraph 1
Article 17 – paragraph 1
1. Each Member State shall designate one or more supervisory authorities to supervise compliance with the obligations laid down in national provisions adopted pursuant to Articles 6 to 11 and Article 15(1) and (2) (‘supervisory authority’).
Amendment 806 #
Proposal for a directive
Article 17 – paragraph 5
Article 17 – paragraph 5
5. Member States may designate the authorities for the supervision of regulated financial undertakings also as supervisory authorities for the purposes of this DirectiveFor financial institutions, the competent authorities shall be an existing national authority already controlling or supervising financial institutions.
Amendment 817 #
Proposal for a directive
Article 18 – paragraph 5 – subparagraph 1 (new)
Article 18 – paragraph 5 – subparagraph 1 (new)
It should be noted that the national authorities supervising financial institutions will adopt the appropriate preventive and sanctioning measures.
Amendment 819 #
Proposal for a directive
Article 18 – paragraph 7
Article 18 – paragraph 7
7. Without prejudice to Member State rules on companies’ right to court appeal and other relevant safeguards, Member States shall ensure that each natural or legal person has the right to an effective judicial remedy against a legally binding decision by a supervisory authority concerning them. in accordance with national law.
Amendment 824 #
Proposal for a directive
Article 20 – paragraph 1
Article 20 – paragraph 1
1. Member StatesThe Commission shall lay down the rulesa list onf sanctions applicable to infringements of national provisions adopted pursuant to this Directive, and shall takethis Directive no later than one year after its entry into force. Member States shall take adequate sanctions from the list and all measures necessary to ensure that they are implemented. The sanctions provided for shall be effective, proportionate and dissuasive.
Amendment 828 #
Proposal for a directive
Article 20 – paragraph 2
Article 20 – paragraph 2
2. In deciding whether to impose sanctions and, if so, in determining their nature and appropriate level, due account shall be taken of the legal framework applicable in the country where the adverse impact occurred, the company’s efforts to comply with any remedial action required of them by a supervisory authority, any investments made and any targeted support provided pursuant to Articles 7 and 8, cumulative effects of the different measures and sanctions already imposed on the company as well as collaboration with other entities to address adverse impacts in its valuesupply chains, as the case may be.
Amendment 834 #
Proposal for a directive
Article 20 – paragraph 3
Article 20 – paragraph 3
Amendment 868 #
Proposal for a directive
Article 22 – paragraph 2 – subparagraph 1
Article 22 – paragraph 2 – subparagraph 1
Notwithstanding paragraph 1, Member States shall ensure that where a company has taken the actions referred to in Article 7(2), point (b) and Article 7(4), or Article 8(3), point (c), and Article 8(5), it shall not be liable for damages caused by an adverse impact arising as a result of the activities of an in direct partner with whom it has an established business relationship, unless it was unreasonable, in the circumstances of the case, to expect that the action actually taken, including as regards verifying compliance, would be adequate to prevent, mitigate, bring to an end or minimise the extent of the adverse impact.
Amendment 875 #
Proposal for a directive
Article 22 – paragraph 2 – subparagraph 2
Article 22 – paragraph 2 – subparagraph 2
In the assessment of the existence and extent of liability under this paragraph, due account shall be taken of the company’s efforts, insofar as they relate directly to the damage in question, to comply with any remedial action required of them by a supervisory authority, any investments made and any targeted support provided pursuant to Articles 7 and 8, as well as any collaboration with other entities to address adverse impacts in its valuesupply chains.
Amendment 881 #
Proposal for a directive
Article 22 – paragraph 3
Article 22 – paragraph 3
3. The civil liability of a company for damages arising under this provision shall be without prejudice to the civil liability of its subsidiaries or of any direct and indirect business partners in the valuesupply chain.
Amendment 895 #
Proposal for a directive
Article 22 – paragraph 5 a (new)
Article 22 – paragraph 5 a (new)
5a. This Article will not apply to institutional investors and asset managers regarding adverse impacts related to investee companies.
Amendment 902 #
Proposal for a directive
Article 24
Article 24
Amendment 907 #
Proposal for a directive
Article 25
Article 25
Amendment 919 #
Proposal for a directive
Article 26
Article 26