460 Amendments of Marie TOUSSAINT related to 2022/0051(COD)
Amendment 91 #
Proposal for a directive
Recital 1
Recital 1
(1) The Union is founded on the respect for human dignity, freedom, democracy, equality, the rule of law and respect for human rights as enshrined in the EU Charter of Fundamental Rights. Article 191 of the Treaty on the Functioning of the European Union (TFEU) states that Union policy shall contribute to preserving, protecting and improving the quality of the environment, protecting human health, prudent and rational utilisation of natural resources and promoting measures at international level to deal with regional or world wide environmental problems, and in particular combating climate change. Those core values that have inspired the Union’s own creation, as well as the universality and indivisibility of human and environmental rights, and respect for the principles of the United Nations Charter and international law, should guide the Union’s action on the international scene. Such action includes fostering the sustainable economic, social and environmental development of developing countries.
Amendment 94 #
Proposal for a directive
Recital 2
Recital 2
(2) A high level of protection and improvement of the quality of the environment, climate neutrality and promoting European core values are among the priorities of the Union, as set out in the Commission’s Communication on A European Green Deal74 . These objectives require the involvement not only of the public authorities but also of private actors, in particular companies. __________________ 74 Communication from the Commission to the European Parliament the European Council, the Council, the European Economic and Social Committee and the Committee of the Region “The European Green Deal” (COM/2019/640 final).
Amendment 95 #
Proposal for a directive
Recital 2 a (new)
Recital 2 a (new)
Amendment 98 #
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 value chains. It is also in the interest of companies to protect human rights and, the environment, climate and more globally all planetary boundaries, 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. Furthermore, ensuring that social inequalities resulting from human rights, environmental and climate related impacts and policies are prevented and resolved and that measures taken to protect human rights, the environment and climate are carried out in a socially just and inclusive way, including by incorporating a gender perspective at all stages of the due diligence process. __________________ 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 109 #
Proposal for a directive
Recital 8
Recital 8
(8) International agreements under the United Nations Framework Convention on Climate Change, to which the Union and the Member States are parties, such as the Paris Agreement84 and the recent Glasgow Climate Pact85 , set out precise avenues to address climate change and keep global warming within 1.5 C degrees. Besides specific actions being expected from all signatory Parties, the role of the private sector, in particular its investment strategies, is considered central to achieve these objectives. __________________ 84 Indeed, just 100 companies have been the source of more than 70% of the world’s greenhouse gas emissions since 1988, representing nearly 1 trillion tonnes of greenhouse gas emissions2a. However, there is a fundamental mismatch between corporate climate commitments and their actual investments to fight against climate change. In 2021, 60% of public communications material from top five supermajor oil companies included a green claim, but only 12% of their capital expenditure (CAPEX) was forecasted to be dedicated to 'low carbon' activities2b. This Directive is therefore an important legislative tool to avoid any misleading neutrality or other misleading claims and to stop greenwashing and fossil fuels expansion worldwide in order to achieve international and European climate objectives, also recommended by the latest scientific reports2c. __________________ 2a CDP Carbon Majors Report, 2017. 2b Influence Map Report, Big Oil's Real Agenda on Climate Change 2022, September 2022, https://influencemap.org/report/Big-Oil-s- Agenda-on-Climate-Change-2022-19585. 2c IEA, Net Zero by 2050, A Roadmap for the Global Energy Sector, p. 51. 84 https://unfccc.int/files/essential_backgroun d/convention/application/pdf/english_paris _agreement.pdf. 85 Glasgow Climate Pact, adopted on 13 November 2021 at COP26 in Glasgow, https://unfccc.int/sites/default/files/resourc e/cma2021_L16_adv.pdf.https://unfccc.int/ sites/default/files/resource/cma2021_L16_ adv.pdf.
Amendment 111 #
Proposal for a directive
Recital 9
Recital 9
(9) In the European Climate Law86 , the Union also legally committed to becoming climate-neutral by 2050 and to reducing emissions by at least 55% by 2030. Both these commitments require changing the way in which companies produce and procure. The Commission’s 2030 Climate Target Plan87 models various degrees of emission reductions required from different economic sectors, though all need to see considerable reductions under all scenarios for the Union to meet its climate objectives. The Plan also underlines that “changes in corporate governance rules and practices, including on sustainable finance, will make company owners and managers prioritise sustainability objectives in their actions and strategies.” The General Union Environmental Action Programme to 2030 (‘8th EAP’)3a, the framework for Union action in the field of the environment and climate, aims to accelerate the green transition to a climate-neutral, sustainable, non-toxic, resource-efficient, renewable energy- based, resilient and competitive circular economy in a just, equitable and inclusive way, and to protect, restore and improve the state of the environment by, inter alia, halting and reversing biodiversity loss. The 2019 Communication on the European Green Deal88 sets out that all Union actions and policies should pull together to help the Union achieve a successful and just transition towards a sustainable future. It also sets out that sustainability should be further embedded into the corporate governance framework. __________________ 3a Decision (EU) 2022/591 of the European Parliament and of the Council of 6 April 2022 on a General Union Environment Action Programme to 2030. 86 Regulation (EU) 2021/1119 of the European Parliament and of the Council of 30 June 2021 establishing the framework for achieving climate neutrality and amending Regulations (EC) No 401/2009 and (EU) 2018/1999 (‘European Climate Law’) PE/27/2021/REV/1 (OJ L 243, 9.7.2021, p. 1). 87 SWD/2020/176 final. 88 COM/2019/640 final.
Amendment 113 #
Proposal for a directive
Recital 9 a (new)
Recital 9 a (new)
(9a) The 2030 climate mitigation objective is swift and predictable reduction of greenhouse gas emissions and, at the same time, enhancement of removals by natural sinks in the Union to attain the 2030 greenhouse gas emission reduction target as laid down in Regulation (EU) 2021/1119, in line with the Union’s climate and environment objectives, whilst ensuring a just transition that leaves no one behind. This Directive should support objectives of the 8th EAP which lays down the enabling condition of phasing out of environmentally harmful subsidies, including through setting a deadline for the phasing out of fossil fuel subsidies consistent with the ambition of limiting global warming to 1.5°C as well as a binding Union framework to monitor and report on Member States’ progress towards phasing out fossil fuel subsidies.
Amendment 114 #
Proposal for a directive
Recital 10 a (new)
Recital 10 a (new)
(10a) Due diligence practices under this Directive should contribute to preserving and restoring marine and terrestrial biodiversity and the biodiversity of inland waters inside and outside protected areas by, inter alia, halting, mitigating and reversing biodiversity loss and improving the state of ecosystems and their functions and the services they provide, and by improving the state of the environment, in particular air, water and soil, as well as combating desertification and soil degradation. They should also include advancing towards a well-being economy that gives back to the planet more than it takes and accelerating the transition to a non-toxic circular economy, where growth is regenerative, resources are used efficiently and sustainably, and the waste hierarchy is applied as well as significantly reducing key environmental and climate pressures related to the Union’s production and consumption. Similarly, pursuing zero-pollution, including in relation to harmful chemicals and hazardous substances, in order to achieve a toxic free-environment, including for air, water and soil, as well as in relation to light and noise pollution, and protecting the health and well-being of people, animals and ecosystems from environment-related risks and negative impacts should be part of company’s due diligence objectives.
Amendment 116 #
Proposal for a directive
Recital 11
Recital 11
(11) The Action Plan on a Circular Economy91 , the Biodiversity strategy92 , the Farm to Fork strategy93 and, the Chemicals strategy94, the Pharmaceutical Strategy4a, the 2021 EU Action Plan Towards Zero Pollution for Air, Water and Soil4b and Updating the 2020 New Industrial Strategy: Building a stronger Single Market for Europe’s recovery95 , Industry 5.096 and the European Pillar of Social Rights Action Plan97 and the 2021 Trade Policy Review98 list an initiative on sustainable corporate governance among their elements. __________________ 91 Communication from the Commission to 4a Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions on the Pharmaceutical Strategy for Europe (COM/2020/761 final). 4b Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions on the Pathway to a Healthy Planet for All, EU Action Plan: 'Towards Zero Pollution for Air, Water and Soil' COM(2021) 400 final. 91 Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions on A new Circular Economy Action Plan For a cleaner and more competitive Europe (COM/2020/98 final). 92 Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions on the EU Biodiversity Strategy for 2030 Bringing nature back into our lives (COM/2020/380 final). 93 Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions on A Farm to Fork Strategy for a fair, healthy and environmentally-friendly food system (COM/2020/381 final). 94 Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions on the Chemicals Strategy for Sustainability Towards a Toxic-Free Environment (COM/2020/667 final). 95 Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions on Updating the 2020 New Industrial Strategy: Building a stronger Single Market for Europe’s recovery (COM/2021/350 final). 96 Industry 5.0; https://ec.europa.eu/info/research-and- innovation/research-area/industrial- research-and-innovation/industry-50_en 97 https://op.europa.eu/webpub/empl/europea n-pillar-of-social-rights/en/ 98 Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions, Trade Policy Review – An Open, Sustainable and Assertive Trade Policy (COM/2021/66/final).
Amendment 120 #
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 and climate impacts connected with companies’ own operations, products throughout their life cycle and services, subsidiaries and value chains.
Amendment 122 #
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, products and services throughout their life cycle, their subsidiaries, as well as their established direct and indirect business relationships throughout their value 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. The action should be proportionate to the significance and scale of the adverse impact and to the contribution of the company’s conduct to the adverse impact. Account should be taken of the specificities of the company’s value chain, sector or geographical area in which its value 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 127 #
Proposal for a directive
Recital 16
Recital 16
(16) The due diligence process set out in this Directive should cover the six steps defined by the OECD Due Diligence Guidance for Responsible Business Conduct, which include due diligence measures for companies to identify and address adverse human rights and, environmental and climate impacts. This encompasses the following steps: (1) integrating due diligence into policies and management systems, (2) identifying and assessing adverse human rights and, environmental and climate impacts, (3) preventing, ceasing or minimising actual and potential adverse human rights, and environmental and climate impacts, (4) assessing the effectiveness of measures, (5) communicating, (6) providing remediation.
Amendment 129 #
Proposal for a directive
Recital 17
Recital 17
(17) Adverse human rights and, environmental and climate impact occur in companies’ own operations, subsidiaries, products, and in their value chains, in particular at the level of raw material sourcing, manufacturing, or at the level of product or waste management and disposal. In order for the due diligence to have a meaningful impact, it should cover human rights and, environmental and climate adverse impacts generated throughout the life-cycle of production and use, waste management and disposal of product or provision of services, at the level of own operations, subsidiaries and in value chains.
Amendment 135 #
Proposal for a directive
Recital 18
Recital 18
(18) The value chain should cover all activities related to the production and use of a good or provision of services by a company, including the development of the product or the service and the use, waste management and disposal of the product as well as the related activities of established business relationships of the company. It should encompass upstream established direct and indirect business relationships that design, extract, manufacture, transport, store and supply primary and secondary 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 landfilling.
Amendment 138 #
Proposal for a directive
Recital 20
Recital 20
Amendment 141 #
Proposal for a directive
Recital 21
Recital 21
(21) Under this Directive, all 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 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 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, cthe exception of micro- enterprises as defined by Article3(1) of Directive 2013/34/EU should be required to comply with due diligence. 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 145 #
Proposal for a directive
Recital 22
Recital 22
(22) In order to reflect the priority areas of international action aimed at tackling human rights and, environmental issues, the selection of high-impact sectors for the purposes of this Directive should be basedand climate issues, this Directive should provide a list of high-impact sectors based, among others, on existing sectoral OECD due diligence guidance. The following sectors that should be regarded as high-impact for the purposes of this Directive: include: the energy sector including gas, nuclear, steam, electricity and other sources throughout their life cycle, from extraction, refining, production, combustion of fuels, transportation, storage and waste management including radioactive waste; the chemicals sector; the manufacture of textiles, fur, leather and related products (including footwear), and the wholesale trade of textiles, clothing and footwear; plastic production, waste shipment and management; agriculture, forestry, fisheries (including aquaculture), the management of land and resources (including in relation to nature conservation or other related activities), the manufacture of food products, and the wholesale trade of agricultural raw materials, live animals, animal products, wood, food, and beverages; construction sector and building infrastructures; transportation sector, logistics and storage; the extraction and refining of mineral resources regardless of where they are extracted from (including crude petroleum, natural gas, coal, lignite, metals and metal ores, as well as all other, non- metallic minerals and quarry products), the manufacture of basic metal products, other non-metallic mineral products and fabricated metal products (except machinery and equipment), and the wholesale trade of mineral resources, basic and intermediate mineral products (including metals and metal ores, construction materials, fuels, chemicals and other intermediate products). As regards the financial sector, due to its specificities, in particular as regards the value chain and the services offered, even if it is covered by sector-specific OECD guidance, it should not form part of the high-impact sectors covered by this Directive. At the same time, in this sector; the production, use and waste management of electronic products; waste management sector; employment activities, the broader coverage of actual and potential adverse impacts should be ensured by also including very large companies in the scope that are regulatedalth, social and elder care; cleaning and household services; hospitality; financial uandertakings, even if they do not have a legal form with limited liability insurance activities; technology, digital activities and online platforms.
Amendment 151 #
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 and climate adverse impacts with respect to companies’ operations, products and services throughout their life cycle, subsidiaries and value 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 1508 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 156 #
Proposal for a directive
Recital 25
Recital 25
(25) In order to achieve a meaningful contribution to the sustainability transition, due diligence under this Directive should be carried out with respect to adverse human rights impact on protected persons resulting from the violation of one of the rights and prohibitions as enshrined in the international conventions as listed in the Annex to this Directive. In order to ensure a comprehensive coverage of human rights, a violation of a prohibition or right not specifically listed in that Annex which directly impairs a legal interest protected in those conventions should also form part of the adverse human rights impact covered by this Directive, provided that the company concerned could have reasonably established the risk of such impairment and any appropriate measures to be taken in order to comply with the due diligence obligations under this Directive, taking into account all relevant circumstances of their operations, such as the sector and operational context. Due diligence should further encompass adverse environmental impacts resuland climate impacts, meaning impacts contributing fromto the violation of oneexceeding of planetary boundaries or an adverse impact ofn the prohibitions and obfollowing elements or functions of ecosystems and the interrelations between: cligmations pursuant to the international environmental conventions listed in the Annex to this Directivee, air and the atmosphere, water and access to water, soil, biodiversity, the transition to a circular economy, light, noise and vibration or human health including occupational health and safety. In particular, companies should also identify and assess actual and potential deterioration of working conditions due to climate change or the exceeding of planetary boundaries, such as the rise of temperatures to an unbearable level for their workers.
Amendment 161 #
Proposal for a directive
Recital 27
Recital 27
(27) In order to conduct appropriate human rights, and environmental and climate due diligence with respect to their operations, products and services throughout their life-cycle, their subsidiaries, and their value chains, companies covered by this Directive should, after consultation with stakeholders, integrate due diligence into corporate policies with short-, medium- and long-term, identify, prevent and mitigate as well as bring to an end and minimise the extent of potential and actual adverse human rights and, environmental and climate impacts, establish and maintain a complaints procedure, monitortrack the implementation and monitor and assess 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 166 #
Proposal for a directive
Recital 29
Recital 29
(29) To comply with due diligence obligations, companies need to take appropriate measures with respect to identification, prevention and bringing to an end adverse impacts. An ‘appropriate measure’ should mean a set of measures that is capable of achieving the objectives of due diligence, commensurate with the degree of severity and the likelihood of the adverse impact, and reasonably available to the company, taking into account the circumstances of the specific case, including characteristics of the economic sector and of the specific business relationship and the company’s influence thereof, and the need to ensure prioritisation of action. In this context, in line with international frameworks, the company’s influence over a business relationship should include, on the one hand its ability to persuade the business relationship to take action to bring to an end or prevent adverse impacts (for example through ownership or factual control, market power, pre-qualification requirements, linking business incentives to human rights and environmental performance, etc.) and, on the other hand, the degree of influence or leverage that the company could reasonably exercise, for example through cooperation with the business partner in question or engagement with another company which is the direct business partner of the business relationship associated with adverse impact.
Amendment 168 #
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 and climate 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 and climate impacts, the company should obtain information about baseline conditions at higher risk sites or facilities in value chains. Identification of adverse impacts should include assessing the human rights, and environmental and climate 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 months, throughout the life of an activity or relationship. Regulated financial undertakings providing loan, credit, or other financial services should identify theWhere the company cannot prevent, bring to an end or minimize all its 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 circumstancessame time, it should develop and implement a prioritisation strategy in consultation with stakeholders, which shall take into account the level of severity, likelihood and reversibility of the different potential adverse impacts on human rights, the environment and climate.
Amendment 174 #
Proposal for a directive
Recital 31
Recital 31
(31) In order to avoid undue burden on the smaller companies operating in high- impact sectors which are covered by this Directive, those companies should only be obliged to identify those actual or potential severe adverse impacts that are relevSMEs covered by this Directive, those companies should be supported with adequate and targeted measures antd to the respective sectorols.
Amendment 177 #
Proposal for a directive
Recital 33
Recital 33
(33) Under the due diligence obligations set out by this Directive, if a company identifies potential adverse human rights or, environmental and climate impacts, it should take appropriate measures to prevent and adequately mitigate them. To provide companies with legal clarity and certainty, this Directive should set out the actions companies should be expected to take for prevention and mitigation of potential adverse impacts where relevant depending on the circumstances.
Amendment 179 #
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, c. Companies should develop and implement a prevention action plan. Companies should seek to obtain contractual and other 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’ value chain. The contractual assurances should be reasonable and non-discriminatory, 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 financingSMEs in their value chain, 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 181 #
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 minimistigation 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 as well as if the conditions for temporary suspension are not met. 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 184 #
Proposal for a directive
Recital 38
Recital 38
(38) Under the due diligence obligations set out by this Directive, if a company identifies actual human rights or, environmental and climate adverse impacts, it should take appropriate measures to bring those to an end. It can be expected that a company is able to bring to an end actual adverse impacts in their own operations and in subsidiaries. However, it should be clarified that, as regards established business relationships, where adverse impacts cannot be brought to an end, companies should minimise the extent of such impacts. Minimisation of the extent of adverse impacts should require an outcome that is the closest possible to bringing the adverse impact to an end. To provide companies with legal clarity and certainty, this Directive should define which actions companies should be required to take for bringing actual human rights and, environmental and climate adverse impacts to an end and minimisation of their extent, where relevant depending on the circumstances.
Amendment 191 #
Proposal for a directive
Recital 42
Recital 42
(42) Companies should provide the possibility for persons, groups, communities, entities and organisations to submit complaints directly to them in case of legitimate concerns regarding actual or potential human rights and, environmental and climate adverse impacts. Organisations who could submit such complaints should include trade unions and other workers’ representatives representing individuals working in the value chain concerned and civil society organisations active in the areas related to the value chain concerned where they have knowledge about a potential or actual adverse impact, organisations or other legal or natural persons who have as a statutory purpose the defence of human rights, climate, the environment and good governance. 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 194 #
Proposal for a directive
Recital 43
Recital 43
(43) Companies should monitortrack the implementation and monitor the effectiveness of their due diligence measures. They should, in consultation with stakeholders, carry out periodic assessments of their own operations, those of their subsidiaries and, where related to the value 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 months and be revised in-between if there are reasonable grounds to believe that significant new risks of adverse impact could have arisen.
Amendment 196 #
Proposal for a directive
Recital 44
Recital 44
(44) Like in the existing international standards set by the United Nations Guiding Principles on Business and Human Rights and the OECD framework, it forms part of the due diligence requirement to communicate externally relevant information on due diligence policies, processes and activities conducted to identify and address actual or potential adverse impacts, including the findings and outcomes of those activities. The proposal to amend Directive 2013/34/EU as regards corporate sustainability reporting sets out relevant reporting obligations for the companies covered by this directive. In order to avoid duplicating reporting obligations, this Directive should therefore not introduce any new reporting obligations in addition to those under Directive 2013/34/EU for the companies covered by that Directive as well as the reporting standards that should be developed under it. As regards companies that are within the scope of this Directive, but do not fall under Directive 2013/34/EU, in order to comply with their obligation of communicating as part of the due diligence under this Directive, they should publish on their website an annual statement in a language customary in the sphere of international business. This reporting should be accessible, comparable, and sufficiently detailed to demonstrate the adequacy of a company’s due diligence process.
Amendment 198 #
Proposal for a directive
Recital 44 a (new)
Recital 44 a (new)
(44a) Companies should provide stakeholders adequate, comprehensive meaningful information about actual and potential adverse human rights, environmental and climate impacts and the actions taken to respect their due diligence. Stakeholders should also be able to request additional information from a company regarding the actions taken to comply with the obligations set in this Directive. The confidentiality of commercial and industrial information should not serve as a barrier for access to information that relates to the implementation, by a company, of the provisions of national law transposing this Directive.
Amendment 200 #
Proposal for a directive
Recital 46 a (new)
Recital 46 a (new)
(46a) Stakeholders, including human rights and environmental defenders should be engage effectively, meaningfully and in an appropriate manner by companies throughout the entire due diligence process. Companies should pay special attention to overlapping vulnerabilities and intersecting factors in stakeholder engagement, including by adopting a gender-responsive approach. Companies should provide meaningful information to stakeholders about actual and potential adverse human rights, environmental and climate impacts of particular operations, projects and investments, in a timely and culturally sensitive and accessible manner taking into account specifics of the stakeholder group including gender. Companies must respect the rights of Indigenous Peoples, as laid out in the United Nations Declaration on the Rights of Indigenous Peoples, including free, prior and informed consent and indigenous peoples’ right to self- determination.
Amendment 201 #
Proposal for a directive
Recital 47
Recital 47
(47) Although SMEs are not included in the scope of this Directive, they could be impacted by its provisions as contractors or subcontractors to the companies which are in the scope. The aim is nevertheless to mitigate financial or administrative burden on SMEs, many of which are already struggling in the context of the global economic and sanitary crisisThe aim is to mitigate financial or administrative burden on SMEs while conducting due diligence pursuant to this Directive. In order to support SMEs, Member States should set up and operate, either individually or jointly, dedicated websites, portals or platforms, and Member States could also financially support SMEs and help them build capacity. Such support should also be made accessible, and where necessary adapted and extended to upstream economic operators in third countries. Companies whose business partner is an SME, are also encouraged to support them to comply with due diligence measures, in case such requirements would jeopardize the viability of the SME and use fair, reasonable, non- discriminatory and proportionate requirements vis-a-vis the SMEs.
Amendment 202 #
Proposal for a directive
Recital 49
Recital 49
(49) The Commission and Member States should continue to work in partnership with third countries to support upstream economic operators build the capacity to effectively prevent and mitigate adverse human rights and environmental impacts of their operations and business relationships, paying specific attention to the challenges faced by smallholders. They should use their neighbourhood, development and international cooperation instruments to support third country governments and upstream economic operators in third countries addressing adverse human rights and, environmental and climate impacts of their operations and upstream business relationships. This could include working with partner country governments, the local private sector and stakeholders on addressing the root causes of adverse human rights and, environmental and climate impacts.
Amendment 204 #
Proposal for a directive
Recital 50
Recital 50
(50) In order to ensure that this Directive effectively contributes to combating climate change, companies should, in consultation with stakeholders, adopt a plan to ensure that the business model and strategy of the company are compatiblealigned with the transition to a sustainable economy and with the limiting of global warming to 1.5 °C in line with the Paris Agreement. In case climate is or should have been identified as a principal risk for or a principal impact of the company’s operations, the comp and with the objective of achieving climate neutrality by 2050 at the latest as established in Regulation EU 2021/1119 (European Climate Law), pursuant to the latest recommendations of the IPCC and the European Scientific Advisory Board on Climate Change. The plan should include science-based targets related to climate objectives of 2030 and 2050, avoiding any misleading claims on climate neutrality, an identification and explanation of decarbonisation levers identified within the company’s operations and value chain and the greenhouse gas emission reduction targets. The planys should include emissions reduction objectives in its planclear obligations for directors and board members to ensure that environmental and climate risks and impacts are addressed in the company’s strategy.
Amendment 208 #
Proposal for a directive
Recital 51
Recital 51
(51) With a view to ensure that such emission reducThe climate targets and transition plan ishould be properly implemented and embedded in the financial incentives of directors, the plan should be duly taken into account when setting directors’ variable remuneration, if variable remuneration is linked to the contribution of a director to the company’s business strategy and long-term interests and sustainability.
Amendment 211 #
Proposal for a directive
Recital 56
Recital 56
(56) In order to ensure effective compensation of victims of adverse impacts, Member States should be required to lay down rules governing the civil liability of companies for damages arising due to its failure to comply with the due diligence process. The company should be liable for damages if they failed to comply with the obligations to prevent and mitigate potential adverse impacts or to bring actual impacts to an end and minimise their extent, and as a result of this failure an adverse impact that should have been identified, prevented, mitigated, brought to an end or its extent minimised through the appropriate measures occurred and led to damage. The company should also be liable for damages that result from adverse human rights, environmental or climate impacts that should have been identified, prevented, mitigated, brought to an end or their extent minimised by its subsidiaries.
Amendment 212 #
Proposal for a directive
Recital 57
Recital 57
(57) As regards damages occurring at the level of established indirect business relationships, the liability of the company should be subject to specific conditions. TWhen the damage results from adverse impacts caused by business relationships within a company’s value chain, the company should not be liable ifunless it carried out specific due diligence measures. However, it should not be exonerated from liabiln prove that ity throughook and implementing such measures in case it was unreasonable to expect that the action actually taken, including ed effective appropriate meas uregards verifying complis, in accordance, would be adequate to prevent, mitigate, bring to an end or minimise the adverse impactith the Directive, to ensure that the damage would not occur. In addition, in the assessment of the existence and extent of liability, due account is to 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 as well as any collaboration with other entities to address adverse impacts in its value chains.
Amendment 215 #
Proposal for a directive
Recital 58
Recital 58
Amendment 217 #
Proposal for a directive
Recital 59 a (new)
Recital 59 a (new)
(59a) The right to an effective remedy is an internationally recognised human right, enshrined in Article 8 of the Universal Declaration of Human Rights, Article 9(3) of the Aarhus Convention on Access to Information, Public Participation in Decision-making and Access to Justice in Environmental Matters and Article 2(3) of the International Covenant on Civil and Political Rights, and is also a fundamental right of the Union within the meaning of Article 47 of the Charter. Delays and difficulties in accessing evidence, as well as gender disparity, geographical location, vulnerabilities and marginalisation can constitute major practical and procedural obstacles for the persons concerned, hindering their access to an effective remedy without fear of reprisals. Member States should thus ensure that victims have access to an effective remedy and that the costs and the length of the proceedings do not prevent claimants from access to courts. These measures might, for example, take the form of public funding, including structural support for victims of actual and potential adverse impacts, limitation of applicable court or administrative fees, or access to legal aid.
Amendment 218 #
Proposal for a directive
Recital 59 b (new)
Recital 59 b (new)
(59b) The most significant barriers to access to justice for victims of adverse impacts is the difficulty in proving the company's failure to meet its obligations. In case of a civil liability claim for damages and when prima facie elements are provided by the claimants, the causal link between the damage and the company’s failure to comply should be presumed and the company should have to prove it has complied with its obligations and appropriate measures were taken.
Amendment 219 #
Proposal for a directive
Recital 59 c (new)
Recital 59 c (new)
(59c) Trade unions, civil society organisations or other relevant actors acting in the public interest such as the Ombudsman should be able to bring representative actions before their courts on behalf and for the protection of the collective interests of victims of actual and potential adverse impacts, and that these entities have the rights and obligations of a claimant party in the proceedings.
Amendment 222 #
Proposal for a directive
Recital 63
Recital 63
(63) In all Member States’ national laws, directors owe a duty of care to the company. In order to ensure that this general duty is understood and applied in a manner which is coherent and consistent with the due diligence obligations introduced by this Directive and that directors systematically take into account sustainability matters in their decisions, this Directive should clarify, in a harmonised manner, the general duty of care of directors to act in the best interest of the company, by laying down that directors take into accountintegrate the sustainability matters as referred to in Directive 2013/34/EU, including, where applicable, human rights, climate change and environmental consequences, including in the short, medium and long term horizons. Such clarification does not require changing existing national corporate structures.
Amendment 226 #
Proposal for a directive
Recital 65
Recital 65
(65) Persons who work for companies subject to due diligence obligations under this Directive or who are in contact with such companies in the context of their work-related activities can play a key role in exposing breaches of the rules of this Directive. They can thus contribute to preventing and deterring such breaches and strengthening the enforcement of this Directive. Directive (EU) 2019/1937 of the European Parliament and of the Council106 should therefore apply to the reporting of all breaches of this Directive and to the protection of persons reporting such breaches. In particular, stakeholders submitting complaints or concerns should be effectively protected, notably by ensuring the confidentiality and anonymity of the complaint or concern raised. Stakeholders should also be protected against Strategic Lawsuit Against Public Participation. __________________ 106 Directive (EU) 2019/1937 of the European Parliament and of the Council of 23 October 2019 on the protection of persons who report breaches of Union law (OJ L 305, 26.11.2019, p. 17).
Amendment 227 #
Proposal for a directive
Recital 65 a (new)
Recital 65 a (new)
(65a) Human rights and environmental defenders who directly protect ecosystems are on the front line of the consequences of adverse environmental, climate and human rights impacts worldwide and in the EU, and may be directly threatened, intimidated, persecuted, harassed or even murdered, and as such should also benefit from balanced and effective protection. Indeed, for the past 10 years, an environmental defender has been killed every other day in the world, no less than 200 people in 20215a. Companies should measure the actual and potential risks of their activities, as well as contextual risks to human rights and environmental defenders, engage with them and publish a policy on defenders that includes a zero- tolerance stance on threats or violence against them. Company policies must explicitly include in their due diligence protocols for safeguarding the rights of Land and Environmental Defenders. __________________ 5a Global Witness (2022), Decade of defiance, Ten years of reporting land and environmental activism worldwide, September 2022.
Amendment 228 #
Proposal for a directive
Recital 70
Recital 70
(70) The Commission should assess and report on a regular basis whether new sectors should be added to the list of high- impact sectors covered by this Directive, in order to align it to guidance from the Organisation for Economic Cooperation and Development or in light of clear evidence on labour exploitation, human rights violations or newly emerging environmental and climate threats, whether the list of relevant international conventions referred to in this Directive should be amended, in particular in the light of international developments, or whether the provisions on due diligence under this Directive should be extended to adverse climate impacts.
Amendment 232 #
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 and climate adverse impacts in companies’ value 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 value 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 233 #
Proposal for a directive
Article 1 – paragraph -1 (new)
Article 1 – paragraph -1 (new)
-1. This Directive aims to ensure that companies respect human rights and protect the environment and the climate within their own operations, products throughout their life-cycle and services, subsidiaries and value chains. This Directive shall contribute to the safeguarding of the planetary boundaries at Union level and worldwide.
Amendment 237 #
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 ands well as environmental and climate adverse impacts, with respect to their own operations, the operationproducts and services, the operations, products and services of their subsidiaries, and the value chain operations carried out by entities with whom the company has an established business relationship and
Amendment 243 #
Proposal for a directive
Article 1 – paragraph 1 – subparagraph 1 – point b a (new)
Article 1 – paragraph 1 – subparagraph 1 – point b a (new)
(ba) on access to justice for victims of the obligations mentioned above.
Amendment 247 #
Proposal for a directive
Article 1 – paragraph 1 – subparagraph 2
Article 1 – paragraph 1 – subparagraph 2
Amendment 256 #
Proposal for a directive
Article 1 – paragraph 3
Article 1 – paragraph 3
3. This Directive shall be without prejudice to obligations in the areas of human rights, protection of the environment and climate change under other Union legislative acts. If the provisions of this Directive conflict with a provision of another Union legislative act pursuing the same objectives and providing for more extensive or more specific obligations, the provisions of the other Union legislative act shall prevail to the extent of the conflict and shall apply to those specific obligations.
Amendment 257 #
Proposal for a directive
Article 2 – paragraph 1 – introductory part
Article 2 – paragraph 1 – introductory part
1. This Directive shall apply to companies which are formed in accordance with the legislation of a Member State and which fulfil one of the following conditions, with the exception of micro- enterprises as defined by article 3(1) of Directive 2013/34/EU:
Amendment 259 #
Proposal for a directive
Article 2 – paragraph 1 – point a
Article 2 – paragraph 1 – point a
Amendment 261 #
Proposal for a directive
Recital 1
Recital 1
(1) The Union is founded on the respect for human dignity, freedom, democracy, equality, the rule of law and respect for human rights as enshrined in the EU Charter of Fundamental Rights. Article 191 of the Treaty on the Functioning of the European Union (TFEU) states that Union policy shall contribute to preserving, protecting and improving the quality of the environment, protecting human health, prudent and rational utilisation of natural resources and promoting measures at international level to deal with regional or worldwide environmental problems, and in particular combating climate change. Those core values that have inspired the Union’s own creation, as well as the universality and indivisibility of human and environmental rights, and respect for the principles of the United Nations Charter and international law, should guide the Union’s action on the international scene. Such action includes fostering the sustainable economic, social and environmental development of developing countries.
Amendment 263 #
Proposal for a directive
Recital 2 a (new)
Recital 2 a (new)
Amendment 266 #
Proposal for a directive
Article 2 – paragraph 1 – point b
Article 2 – paragraph 1 – point b
Amendment 268 #
Proposal for a directive
Recital 4
Recital 4
(4) The behaviour of companieundertakings across all sectors of the economy is key to success in the Union’s sustainability objectives as Union companieundertakings, especially large ones, rely on global value chains. It is also in the interest of companies toundertakings to safeguard good governance and protect human rights and, the environment, the climate and more globally all planetary boundaries, 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. . Furthermore, ensuring that social inequalities resulting from human rights, good governance, environmental and climate related impacts and policies are prevented and resolved and that measures taken to safeguard good governance and protect human rights, the environment and climate are carried out in a socially just and inclusive way, including by incorporating a gender perspective at all stages of the due diligence process. _________________ 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 281 #
Proposal for a directive
Recital 7 a (new)
Recital 7 a (new)
(7a) Undertakings should be responsible accountable for using their influence to contribute to a living wage in value chains. Living wage for smallholders is understood as the income they earn from their production, which must meet the needs of their household and their farm, including those of their relatives.
Amendment 284 #
Proposal for a directive
Recital 8
Recital 8
(8) International agreements under the United Nations Framework Convention on Climate Change, to which the Union and the Member States are parties, such as the Paris Agreement84 and the recent Glasgow Climate Pact85 , set out precise avenues to address climate change and keep global warming within 1.5 C degrees. Besides specific actions being expected from all signatory Parties, the role of the private sector, in particular its investment strategies, is considered central to achieve these objectives. _________________ 84 Indeed, just 100 undertakings have been the source of more than 70% of the world’s greenhouse gas emissions since 1988, representing nearly 1 trillion tonnes of greenhouse gas emissions8a. However, there is a fundamental mismatch between corporate climate commitments and their actual investments to fight against climate change. In 2021, 60 % of the public communications material from the 5 supermajor oil undertakings included a green claim, but only 12 % of their capital expenditure (CAPEX) was forecasted to be dedicated to 'low carbon 'activities8b. This Directive is therefore an important legislative tool to avoid any misleading neutrality or other misleading claims and to stop greenwashing and fossil fuels expansion worldwide in order to achieve International and European climate objectives, also recommended by the latest scientific reports8c. _________________ 8a CDP Carbon Majors Report, 2017 8b Influence Map Report, Big Oil's Real Agenda on Climate Change 2022, September 2022, https://influencemap.org/report/Big-Oil-s- Agenda-on-Climate-Change-2022-19585 8c IEA, Net Zero by 2050, A Roadmap for the Global Energy Sector, p. 51. 84 https://unfccc.int/files/essential_backgroun d/convention/application/pdf/english_paris _agreement.pdf. 85 Glasgow Climate Pact, adopted on 13 November 2021 at COP26 in Glasgow, https://unfccc.int/sites/default/files/resourc e/cma2021_L16_adv.pdf.https://unfccc.int/ sites/default/files/resource/cma2021_L16_ adv.pdf.
Amendment 285 #
Proposal for a directive
Article 2 – paragraph 2 – introductory part
Article 2 – paragraph 2 – introductory part
2. This Directive shall also apply to large as well as listed small and medium- sized companies which are formed in accordance with the legislation of a third country, and fulfil one of the following conditions:have generated a net turnover of more than EUR 8 million in the financial year preceding the last financial year.
Amendment 287 #
Proposal for a directive
Article 2 – paragraph 2 – point a
Article 2 – paragraph 2 – point a
Amendment 289 #
Proposal for a directive
Recital 9
Recital 9
(9) In the European Climate Law86 , the Union also legally committed to becoming climate-neutral by 2050 and to reducing emissions by at least 55% by 2030. Both these commitments require changing the way in which companieundertakings produce and procure. The Commission’s 2030 Climate Target Plan87 models various degrees of emission reductions required from different economic sectors, though all need to see considerable reductions under all scenarios for the Union to meet its climate objectives. The Plan also underlines that “changes in corporate governance rules and practices, including on sustainable finance, will make company owners and managers prioritise sustainability objectives in their actions and strategies.” The General Union Environmental Action Programme to20309a (‘8th EAP’), the framework for Union action in the field of the environment and climate, aims to accelerate the green transition to a climate-neutral, sustainable, non-toxic, resource-efficient, renewable energy- based, resilient and competitive circular economy in a just, equitable and inclusive way, and to protect, restore and improve the state of the environment by, inter alia, halting and reversing biodiversity loss. The 2019 Communication on the European Green Deal88 sets out that all Union actions and policies should pull together to help the Union achieve a successful and just transition towards a sustainable future. It also sets out that sustainability should be further embedded into the corporate governance framework. _________________ 9a General Union Environment Action Programme to 2030, A9-0203/127; 86 Regulation (EU) 2021/1119 of the European Parliament and of the Council of 30 June 2021 establishing the framework for achieving climate neutrality and amending Regulations (EC) No 401/2009 and (EU) 2018/1999 (‘European Climate Law’) PE/27/2021/REV/1 (OJ L 243, 9.7.2021, p. 1). 87 SWD/2020/176 final. 88 COM/2019/640 final.
Amendment 290 #
Proposal for a directive
Recital 9 a (new)
Recital 9 a (new)
(9a) The 2030 climate mitigation objective is swift and predictable reduction of greenhouse gas emissions and, at the same time, enhancement of removals by natural sinks in the Union to attain the 2030greenhouse gas emission reduction target as laid down in Regulation (EU)2021/1119, in line with the Union’s climate and environment objectives, whilst ensuring a just transition that leaves no one behind. This Directive should support objectives of the 8th EAP which lays down the enabling condition of phasing out of environmentally harmful subsidies, including through setting a deadline for the phasing out of fossil fuel subsidies consistent with the ambition of limiting global warming to 1,5°C as well as a binding Union framework to monitor and report on Member States’ progress towards phasing out fossil fuel subsidies.
Amendment 294 #
Proposal for a directive
Article 2 – paragraph 2 – point b
Article 2 – paragraph 2 – point b
Amendment 294 #
Proposal for a directive
Recital 10 a (new)
Recital 10 a (new)
Amendment 301 #
Proposal for a directive
Article 3 – paragraph 1 – point a – point i
Article 3 – paragraph 1 – point a – point i
(i) a legal person constituted as one of the legal forms listed in Annex I and II to Directive 2013/34/EU of the European Parliament and of the Council110 ; __________________ 110 Directive 2013/34/EU of the European Parliament and of the Council of 26 June 2013 on the annual financial statements, consolidated financial statements and related reports of certain types of undertakings (OJ L 182, 29.6.2013, p. 19).
Amendment 303 #
Proposal for a directive
Recital 14
Recital 14
(14) This Directive aims to ensure that companieundertakings 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, good governance, and environmental and climate impacts connected with companieundertakings’ own operations, goods throughout their life cycle and services, and those of their subsidiaries and value chains.
Amendment 308 #
Proposal for a directive
Article 3 – paragraph 1 – point b
Article 3 – paragraph 1 – point b
(b) ‘adverse environmental impact’ means an adverse impact on the environment resulting from the violation of one of the prohibitions and obligations pursuant to the international environmental conventions listed in the Annex, Part II;and climate impact’ means:
Amendment 311 #
Proposal for a directive
Recital 15
Recital 15
(15) CompanieUndertakings should take appropriate steps to set up and carry out due diligence measures, with respect to their own operations, produced goods and services throughout their life cycle, and those of their subsidiaries, as well as their established direct and indirect business relationships throughout their value chains and therefore beyond the first tier of the value chain, in accordance with the provisions of this Directive. This Directive should not require companieundertakings 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 companyundertaking might not be in a position to arrive at such results. Therefore, the main obligations in this Directive should be ‘obligations of means’. The companya standard of conduct. The undertaking 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. The action should be proportionate to the significance and scale of the adverse impact and to the contribution of the undertaking s conduct to the adverse impact. Account should be taken of the specificities of the companyundertaking’s value chain, sector or geographical area in which its value chain partners operate, the companyundertaking’s power to influence its direct and indirect business relationships, and whether the companyundertaking could increase its power of influence.
Amendment 312 #
Proposal for a directive
Article 3 – paragraph 1 – point b – point i (new)
Article 3 – paragraph 1 – point b – point i (new)
i) contributing to the exceeding of planetary boundaries;
Amendment 313 #
Proposal for a directive
Article 3 – paragraph 1 – point b – point ii (new)
Article 3 – paragraph 1 – point b – point ii (new)
ii) an adverse impact on the following elements or functions of ecosystems and the interrelations between them: (a) climate, including but not limited to greenhouse gas emissions and the destruction or degradation of sinks; (b) air and the atmosphere, including but not limited to air pollution; (c) water and access to water, including but not limited to, water use, water pollution, water quantities and depletion of freshwater; (d) soil, including but not limited to, soil pollution, soil erosion, land use and land degradation, soil contamination from waste disposal and treatment; (e) biodiversity, including but not limited to, damage to wildlife, flora, seabed and marine environment, natural habitats and ecosystems; (f) hazardous substances; (g) energy use; (i) the transition to a circular economy, including but not limited to impairment to reusability and recyclability; (j) light, noise and vibration, including not limited to noise and light pollution; (k) human health in accordance with the ‘One Health’ approach and the right to a healthy environment, including but not limited to occupational health, safety and the deterioration of working conditions due to climate change or the exceeding of planetary boundaries, such as the rise of temperatures to an unbearable level for their workers.
Amendment 316 #
Proposal for a directive
Article 3 – paragraph 1 – point b a (new)
Article 3 – paragraph 1 – point b a (new)
(ba) ‘Science-based target’ means a target of the undertaking's operations and its value chains defined on the basis of conclusive scientific evidence and with independent scientific validation, that is consistent with a 1.5°C climate scenario as defined by the IPCC;
Amendment 317 #
Proposal for a directive
Article 3 – paragraph 1 – point b b (new)
Article 3 – paragraph 1 – point b b (new)
(bb) 'Planetary boundaries' means climate change, biosphere integrity (functional and genetic), land- system changes, freshwater use, biogeochemical flows (nitrogen and phosphorus), ocean acidification, atmospheric aerosol pollution, stratospheric ozone depletion, and release of chemicals as defined by the Stockholm Resilience Centre;
Amendment 318 #
Proposal for a directive
Recital 16 a (new)
Recital 16 a (new)
(16a) Undertakings should develop and adapt the due diligence measures in light of the context, environment, and political and social realities in which undertakings, their subsidiaries and their business relationships throughout their value chains operate. In conflict-affected and high-risk areas, undertakings run an increased risk to be involved in severe human rights abuses. In these areas undertakings should therefore undertake heightened, conflict-sensitive due diligence, in order to address these heightened risks and to ensure that they do not facilitate, finance, exacerbate or otherwise negatively impact the conflict or contribute to violations of international human rights law or international humanitarian law in conflict-affected or high-risk areas.
Amendment 319 #
Proposal for a directive
Article 3 – paragraph 1 – point c a (new)
Article 3 – paragraph 1 – point c a (new)
Amendment 319 #
Proposal for a directive
Recital 16 b (new)
Recital 16 b (new)
(16b) Heightened due diligence includes complementing the standard due diligence with a thorough conflict analysis, based on meaningful and conflict-sensitive stakeholder engagement and aimed at ensuring an understanding of the root causes, triggers and parties driving the conflict and the impact of the undertaking’s business activities on the conflict. In situations of armed conflict and/or military occupation, undertakings should respect the obligations and standards identified in International Humanitarian Law (IHL) and International Criminal Law (ICL) standards. undertakings should follow guidance provided by relevant international bodies, including the International Committee of the Red Cross and the UNDP.
Amendment 322 #
Proposal for a directive
Recital 17 a (new)
Recital 17 a (new)
(17a) Global value chains in particular critical raw materials value chains, are impacted by detrimental effects of natural or man-made hazards. The risks in critical value chains have been made apparent by the COVID-19 crisis while the frequency and impact of those shocks are likely to increase in the future, constituting a driver for inflation and leading to a subsequent increase of macroeconomic volatility as well as market and trade uncertainty. To address this, the EU should establish resilience stress tests for undertakings, akin to the stress tests for financial institutions, that would map, assess and provide potential responses to their value chain risks, including externalities as well as social, environmental and political risks.
Amendment 327 #
Proposal for a directive
Article 3 – paragraph 1 – point f
Article 3 – paragraph 1 – point f
Amendment 333 #
Proposal for a directive
Recital 18
Recital 18
(18) The value chain should cover all activities related to the production and use of a good or provision of services by a companyn undertaking, its subsidiaries or undertakings in which it holds minority shareholding, including the development of the product or the service and the use, waste management and disposal of the product as well as the related activities of established business relationships of the companyundertaking or its subsidiaries. It should encompass upstream established direct and indirect business relationships that design, extract, manufacture, transport, store and supply primary and secondary raw materials, products, parts of products, or provide services to the companyundertaking that are necessary to carry out the companyundertaking’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 companyundertaking 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 landfilling..
Amendment 336 #
Proposal for a directive
Article 3 – paragraph 1 – point g
Article 3 – paragraph 1 – point g
(g) ‘value chain’ of a company' means activities related to the production of goods or the provision of services by a companythe company, its subsidiaries or companies in which it holds a minority shareholding, including the development of the product or the service and the use, waste management 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), ‘value 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 services and of other companies belonging to the same group whose activities are linked to the contract in question. The value chain of such regulated financial undertakings does not cover SMEs receiving loan, credit, financing, insurance or reinsurance of such entities; or its subsidiaries.
Amendment 337 #
Proposal for a directive
Recital 19
Recital 19
(19) As regards regulated financial undertakings providing loan, credit, or other financial services, “value chain” with respect to the provision of such services should be limited to the activities of the clients receiving such services, and the subsidiaries thereof whose activities are linked to the contract in question. Clients that are hHouseholds and natural persons not acting in a professional or business capacity, as well as small and medium sized undertakings, should not be considered to be part of the value chain. The activities of the companies or other legal entities that are included in the value chain of that client should not be covered of financial institutions.
Amendment 340 #
Proposal for a directive
Recital 20
Recital 20
Amendment 342 #
Proposal for a directive
Article 3 – paragraph 1 – point g a (new)
Article 3 – paragraph 1 – point g a (new)
(ga) 'products' means any items at each stage of its life-cycle that are produced, used, sold, supplied, made available or disposed by an undertaking;
Amendment 344 #
Proposal for a directive
Article 3 – paragraph 1 – point g b (new)
Article 3 – paragraph 1 – point g b (new)
(gb) ‘services’ means services within the meaning of article 57 TFEU;
Amendment 347 #
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 value chain, with human rights and, environmental and climate 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, expertise and competence in environmental, climate and human rights matters and is accountable for the quality and reliability of the audit;
Amendment 348 #
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 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 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 sectorall EU undertakings with the exception of micro- enterprises as defined by Article 3(1) of Directive2013/34/EU should be required to comply with due diligence. Undertakings operating in high-impact sectors and high- risk areas 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 companyundertaking. 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 companyundertaking. _________________ 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 351 #
Proposal for a directive
Article 3 – paragraph 1 – point h a (new)
Article 3 – paragraph 1 – point h a (new)
(ha) ‘environmental human rights defenders’ means individuals and groups who, in their personal or professional capacity and in a peaceful manner, strive to protect and promote human rights relating to the environment and climate, including biodiversity, water, air, land, soil, flora and fauna
Amendment 352 #
Proposal for a directive
Article 3 – paragraph 1 – point h b (new)
Article 3 – paragraph 1 – point h b (new)
(hb) ‘human rights defenders’ means individuals, groups and organs of society that promote and protect universally recognised human rights and fundamental freedoms; human rights defenders seek the promotion and protection of civil and political rights as well as the promotion, protection and realisation of economic, social and cultural rights; human rights defenders also promote and protect the rights of members of groups such as indigenous communities;
Amendment 355 #
Proposal for a directive
Recital 22
Recital 22
(22) In order to reflect the priority areas of international action aimed at tackling human rights and environmental issues, the selection, good governance, environmental and climate issues, this Directive should provide a list of high- impact sectors for the purposes of this Directive should be basedbased¸ among others, on existing sectoral OECD due diligence guidance. The following as well as the EBRD high risk sectors list. The sectors that should be regarded as high-impact for the purposes of this Directive: include: the energy sector including gas, nuclear, steam, electricity and other sources throughout their life cycle, from extraction, refining, production, combustion of fuels, transportation, storage and waste management including radioactive waste; the chemicals sector; the manufacture of textiles, apparel, fur, leather and related products (including footwear), and the wholesale trade and retail of textiles, clothing and footwear; plastic production, waste shipment and management; agriculture, forestry, fisheries (including aquaculture), the management of land and resources (including in relation to nature conservation or other related activities), the manufacture of food products, and the wholesale trade of agricultural raw materials, live animals, animal products, wood, food, and beverages; construction sector and infrastructure building; transportation sector, logistics and storage; the extraction and refining of mineral resources regardless of where they are extracted from (including crude petroleum, natural gas, coal, lignite, metals and metal ores, as well as all other, non-metallic minerals and quarry products), the manufacture of basic metal products, other non-metallic mineral products and fabricated metal products (except machinery and equipment), and the wholesale trade of mineral resources, basic and intermediate mineral products (including metals and metal ores, construction materials, fuels, chemicals and other intermediate products). As regards the financial sector, due to its specificities, in particular as regards the value cha the production, use and waste management of electronic products; waste management sector; employment activities, health, social and elder care; cleaning and the services offered, even if it is covered by sector-specific OECD guidance, it should not form part of the high-impact sectors covered by this Directive. At the same time, in this sector, the broader coverage of actual and potential adverse impacts should be ensured by also including very large companies in the scope that are regulated financial undertakings, even ifhousehold services; hospitality; financial services provided by regulated financial undertakings, according to Article 3(a)(iv), such as the provision of loan, credit, financing, investment, pensions, securitisation, insurance and reinsurance, market funding, risk management, payment services and other financial services; technology, digital activities and online platforms; manufacture and trade of weapons and ammunition, including dual-use items, manufacture and trade of military fighting vehicles; private security activities and security systems service activities, including they do not have a legal form with limited liabilityevelopment and operation of biometrics and surveillance technologies.
Amendment 358 #
Proposal for a directive
Article 3 – paragraph 1 – point l
Article 3 – paragraph 1 – point l
(l) ‘severe adverse impact’ means an adverse environmental and climate impact or an adverse human rights impact that is especially significant by its nature, or affects or could affect a large number of persons or a large area of the environment, or which is or could be irreversible, or is particularly difficult to remedy as a result of the measures necessary to restore the situation prevailing prior to the impact;
Amendment 359 #
Proposal for a directive
Recital 23
Recital 23
(23) In order to achieve fully the objectives of this Directive addressing human rights and, good governance, adverse environmental and climate impacts with respect to companieundertakings’ operations, produced goods and services throughout their life cycle, those of their subsidiaries and value chains, third-country companies with significantundertakings with operations in the EU should also be covered. More specifically, the Directive should apply to third-country companieundertakings which generated a net turnover of at least EUR 1508 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 360 #
Proposal for a directive
Article 3 – paragraph 1 – point n
Article 3 – paragraph 1 – point n
(n) ‘stakeholders’ means (i) the company’s employeeworkers, the employees of its subsidiaries, and other individuals, groups, communities, or entities or non-governmental organisations whose rights or interests are or could be affected by the products, services and operations of that company, its subsidiaries and its business relationships; r by the potential or actual adverse impacts on human rights, climate and environment of that company, its subsidiaries and its business relationships across the entire value chain; (ii) organisations who have as a statutory purpose the defence of human rights, climate, the environment and good governance; and (iii) other legal or natural persons engaged in the defence of human rights, climate, the environment, land or good governance.
Amendment 363 #
Proposal for a directive
Article 3 – paragraph 1 – point q
Article 3 – paragraph 1 – point q
(q) ‘appropriate measure’ means a set of measures that is capable of achieving the objectives of due diligence and effectively addressing the adverse impact,, commensurate with the degree of severity and the likelihood of the adverse impact, and reasonably available to the company, taking into account the circumstances of the specific case, including characteristics of the economic sector and of the specific business relationship and the company’s influence thereof, and the need to ensure prioritisation of action.
Amendment 364 #
Proposal for a directive
Recital 25
Recital 25
(25) In order to achieve a meaningful contribution to the sustainability transition, due diligence under this Directive should be carried out with respect to adverse human rights impact on protected persons resulting from the violation of one ofany internationally recognised human right, including but not limited to the rights and prohibitions as enshrined in the international conventions as listed in the Annex to this Directive. In order to ensure a comprehensive coverage of human rights, a violation of a prohibition or right not specifically listed in that Annex which directly impairs a legal interest protected in those conventions should also form part of the adverse human rights impact covered by this Directive, provided that the companyundertaking concerned could have reasonably established the risk of such impairment and any appropriate measures to be taken in order to comply with the due diligence obligations under this Directive, taking into account all relevant circumstances of their operations, such as the sector and operational context. Due diligence should further encompass adverse environmental impacts resulting from the violation of one of the prohibitions and obligations pursuant to the international environmental conventions listed in the Annex to this Directive. and climate impacts, meaning impacts contributing to the exceeding of planetary boundaries or an adverse impact on the following elements or functions of ecosystems and the interrelations between: climate, air and the atmosphere, water and access to water, soil, biodiversity, use of energy and hazardous substances, the transition to a circular economy, light, noise and vibration or human health including occupational health and safety as well as impacts resulting from the violation of one of the prohibitions and obligations established under EU and international environmental law, including, but not limited pursuant to the international environmental conventions listed in the Annex to this Directive. In particular, undertakings should also identify and assess actual and potential deterioration of working conditions due to climate change or the exceeding of planetary boundaries, such as the rise of temperatures to an unbearable level for their workers. Next to the protection of human rights, the environment and climate, safeguarding good governance should also form an intrinsic part of due diligence under this Directive and requires also a comprehensive approach including, but not limited to, the violation of one of the prohibitions and obligations covered by the international conventions listed in Part IIa of the Annex to this Directive.
Amendment 366 #
Proposal for a directive
Recital 27
Recital 27
(27) In order to conduct appropriate human rights, good governance, climate and environmental due diligence with respect to their operations, produced goods and services throughout their life-cycle, and those their subsidiaries, and their value chains, companieundertakings covered by this Directive should after consultation with stakeholders, integrate due diligence into corporate policies with short-, medium- and long-term measures, identify, prevent and mitigate, remediate as well as bring to an end and minimistigate the extent of potential and actual adverse human rights and, good governance, environmental and climate impacts, establish and maintain a complaints procedure, monitortrack, monitor and assess 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 companieundertakings, 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 371 #
Proposal for a directive
Article 4 – paragraph 1 – introductory part
Article 4 – paragraph 1 – introductory part
Amendment 371 #
Proposal for a directive
Recital 28
Recital 28
(28) In order to ensure that due diligence forms part of companieundertakings’ corporate policies, and in line with the relevant international framework, companiesundertakings’ should integrate due diligence into all their corporate policies and have in place a due diligence policy with short-, medium- and long-term measures and targets. The due diligence policy should contain a description of the companyundertaking’s approach, including in the long term, to due diligence, a code of conduct describing the rules and principles to be followed by the companyundertaking’s employees and subsidiaries; a description of the processes put in place to implement due diligence, including the measures taken to verify compliance with the code of conduct and to extend its application to established business relationships. The code of conduct should apply in all relevant corporate functions and operations, including trading, procurement, pricing practices and purchasing decisions. Companieundertakings should also update their due diligence policy annually.
Amendment 376 #
Proposal for a directive
Article 4 – paragraph 1 – point f a (new)
Article 4 – paragraph 1 – point f a (new)
(fa) engaging with stakeholders in a meaningful way, in accordance with article 9a.
Amendment 376 #
Proposal for a directive
Recital 29
Recital 29
(29) To comply with due diligence obligations, companieundertakings need to take appropriate measures with respect to identification, prevention and bringing to an end adverse impacts. ‘An ‘appropriate measures’ should mean a set of measures that is capable of achieving the objectives of due diligence, commensurate with the degree of severity and the likelihood of the adverse impact, and reasonably available to the company, taking into account the circumstances of the specific case, including characteristics of the economic sector and of the specific business relationship and the company’s influence thereof, and the need to ensure prioritisation of action. In this context, in line with international frameworks, the company’s influence over a business relationship should include, on the one hand its ability to persuade the business relationship to take action to bring to an end or prevent adverse impacts (for example through ownership or factual control, market power, pre-qualification requirements, linking business incentives to human rights and environmental performance, etc.) and, on the other hand, the degree of influence or leverage that the company could reasonably exercise, for example through cooperation with the business partner in question or engagement with another company which is the direct business partner of the business relationship associated with adverse impact such as the characteristics of the economic sector and the size of the undertaking.
Amendment 380 #
Proposal for a directive
Recital 30
Recital 30
(30) Under the due diligence obligations set out by this Directive, a companyn undertaking should identify actual or potential adverse human rights and, good governance, environmental and climate 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 and climate impacts, the companyundertaking should obtain information about baseline conditions at higher risk sites or facilities in value chains. Identification of adverse impacts should include assessing the human rights, good governance, and environmental and climate 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 months, throughout the life of an activity or relationship. Regulated financial undertakings providing loan, credit, or other financial services shouldWhen identify theing adverse impacts only at the inception of the contract. When identifying adverse impacts, companie, undertakings should also identify and assess the impact of a business relationship’s business model and strategies, including trading, procurement and pricing practices. Where the companyundertaking 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,develop, implement and regularly review a prioritisation strategy in consultation with stakeholders, which should be based on an objective assessment and takinge into account the specific circumstanceslevel of severity, likelihood, the duration, the spread and reversibility of the different potential adverse impacts on human rights, good governance, the environment and the climate.
Amendment 382 #
Proposal for a directive
Article 5 – paragraph 1 – introductory part
Article 5 – paragraph 1 – introductory part
1. Member States shall ensure that companies integrate due diligence into all their corporate policies and have in place a due diligence policy. The due diligence policy shall be developed in consultation with stakeholders and contain all of the following:
Amendment 386 #
Proposal for a directive
Article 5 – paragraph 1 – point a
Article 5 – paragraph 1 – point a
(a) a description of the company’s approach to due diligence, including in the long term, to due diligenshort, medium and long term, and covering all their operations, products and services;
Amendment 386 #
(31) In order to avoid undue burden on the smaller companies operating in high- impact sectors which are covered by this Directive, those companies should only be obliged to identify those actual or potential severe adverse impacts that are relevSMEs covered by this Directive, those undertakings should be supported with adequate and targeted measures antd to the respective sectorols .
Amendment 387 #
Proposal for a directive
Article 5 – paragraph 1 – point b
Article 5 – paragraph 1 – point b
(b) a code of conduct describing rules and principles to be followed by the company’s employees and subsidiaries across all corporate functions and operations;
Amendment 390 #
Proposal for a directive
Article 5 – paragraph 1 – point c
Article 5 – paragraph 1 – point c
(c) a description of the processes and concrete measures put in place to implement due diligence across the value chain, including the measures taken to verify compliance with the code of conduct and to extend its application to established business relationships.
Amendment 391 #
Proposal for a directive
Article 5 – paragraph 1 a (new)
Article 5 – paragraph 1 a (new)
1a. For companies operating in one of the sectors referred to in Article 3 point (ca), the description of the company’s approach, the code of conducts and description of the processes and measures required under paragraph 1 (a) to (c) shall also include a detailed focus on the risks that are specific to that sector.
Amendment 392 #
Proposal for a directive
Article 5 – paragraph 2
Article 5 – paragraph 2
2. Member States shall ensure that the companies updatereview, update and publish their due diligence policy annuallyt least every 12 months and whenever needed, in particular when there are reasonable grounds to believe that new risks of the occurrence of adverse impacts have arised or may arise.
Amendment 394 #
Proposal for a directive
Recital 33
Recital 33
(33) Under the due diligence obligations set out by this Directive, if a companyn undertaking identifies potential adverse human rights or, good governance, environmental or climate impacts, it should take appropriate measures to prevent and adequately mitigate them. To provide companieundertakings with legal clarity and certainty, this Directive should set out the actions companieundertakings should be expected to take for prevention and mitigation of potential adverse impacts where relevant depending on the circumstances.
Amendment 396 #
Proposal for a directive
Recital 34
Recital 34
(34) So as to comply with the prevention and mitigation obligation under this Directive, companieundertakings should be required to take the following actions, where relevant. Where necessary due to the complexity of prevention measures, companie. Undertakings should develop and implement a prevention action plan. Companies should seek toUndertakings should obtain contractual and other 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’ value chain. The contractual assurances should be reasonable, non-discriminatory and accompanied by appropriate measures to verify compliance. To ensure comprehensive prevention of actual and potential adverse impacts, companieundertakings 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 financingSMEs in their value chain, 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 capacity- building via activities such as training, management systems upgrading, and collaborate with other companieundertakings to develop guidance and sectoral supporting materials, with a particular focus on SMEs.
Amendment 397 #
Proposal for a directive
Article 6 – title
Article 6 – title
Identifying and assessing actual and potential adverse impacts
Amendment 398 #
Proposal for a directive
Article 6 – paragraph 1
Article 6 – paragraph 1
Amendment 408 #
Proposal for a directive
Article 6 – paragraph 1 a (new)
Article 6 – paragraph 1 a (new)
1a. Member States shall ensure that in particular for companies operating in one of the sectors referred to in Article 3 point (ca), appropriate measures shall also target the risks that are specific to that sector.
Amendment 408 #
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 companieundertakings 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,To assess the alignment of these schemes and initiatives with the obligations under this Directive, the Commission and the Member States should refer to the framework laid down by the accreditation directive(Regulation (EC) No 765/2008), before allowing them to play a role in the implementation of these obligations. In order to ensure full information on such initiatives, the Directive should also refer to the possibility for the Commission and the Member States toshould facilitate the dissemination of information on such schemes or initiatives and their outcomes. The Commission, in collaboration with Member States, mayshould issue guidance for assessing the fitness of industry schemes and multi-stakeholder initiatives.
Amendment 414 #
Proposal for a directive
Article 6 – paragraph 2 a (new)
Article 6 – paragraph 2 a (new)
2a. Member States shall ensure that companies map their value chains and publicly disclose relevant information including names, locations, types of operations, products and services supplied, as well as other relevant information concerning subsidiaries, branches and business relationships.
Amendment 414 #
Proposal for a directive
Recital 38
Recital 38
(38) Under the due diligence obligations set out by this Directive, if a companyn undertaking identifies actual human rights or, good governance, environmental or climate adverse impacts, it should take appropriate measures to bring those to an end. It can be expected that a companyn undertaking is able to bring to an end actual adverse impacts in their own operations and in subsidiaries. However, it should be clarified that, as regards established business relationships, where adverse impacts cannot be brought to an end, companieundertakings should minimise the extent of such impacts. Minimisation of the extent of adverse impacts should require an outcome that is the closest possible to bringing the adverse impact to an end. To provide companieundertakings with legal clarity and certainty, this Directive should define which actions companieundertakings should be required to take for bringing actual human rights and, good governance, environmental and climate adverse impacts to an end and minimisation of their extent, where relevant depending on the circumstances.
Amendment 422 #
Proposal for a directive
Article 6 – paragraph 4
Article 6 – paragraph 4
4. Member States shall ensure that, for the purposes of identifying and assessing the adverse impacts referred to in paragraph 1 based on, where appropriate, quantitative and qualitative information, including disaggregated data, companies are entitled to make use of appropriate resources, including independent and science-based 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 onincluding trade unions and non-governmental organisations to gather information on as well as to identify and assess actual or potential adverse impacts.
Amendment 427 #
Proposal for a directive
Recital 42
Recital 42
(42) CompanieUndertakings should provide the possibility for persons, groups, communities, entities and organisations to submit complaints directly to them in case of legitimate concerns regarding actual or potential human rights and, good governance, environmental and climate adverse impacts. Organisations who could submit such complaints should include trade unions and other workers’ representatives representing individuals working in the value chain concerned and civil society organisations active in the areas related to the value chain concerned where they have knowledge about a potential or actual adverse impact. Companie, human rights and environmental rights defenders, or other legal or natural persons who have as a statutory purpose the defence of human rights, climate, the environment or good governance . Undertakings 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 companyundertaking appropriate follow-up on the complaint and to meet with the companyundertaking’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 companieundertakings.
Amendment 432 #
Proposal for a directive
Recital 43
Recital 43
(43) CompanieUndertakings should monitortrack the implementation and monitor the effectiveness of their due diligence measures. They should, in consultation with stakeholders, carry out periodic assessments of their own operations, those of their subsidiaries and, where related to the value chains of the companyundertaking, those of their established business relationships, to monitor the effectiveness of the identification, prevention, minimisation, bringing to an end and mitigation of human rights, good governance, and environmental and climate 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 months and be revised in-between if there are reasonable grounds to believe that significant new risks of adverse impact could have arisen.
Amendment 435 #
Proposal for a directive
Article 7 – paragraph 1
Article 7 – paragraph 1
1. Member States shall ensure that companies take appropriate measures to prevent, or where prevention is not possible or not immediately possible, adequately mitigate potential adverse human rights impacts and adverse environmentalas well as environmental and climate adverse impacts that have been, or should have been, identified pursuant to Article 6, in accordance with paragraphs 2, 3, 4 and 5 of this Article.
Amendment 437 #
Proposal for a directive
Recital 44
Recital 44
(44) Like in the existing international standards set by the United Nations Guiding Principles on Business and Human Rights and the OECD framework, it forms part of the due diligence requirement to communicate externally relevant information on due diligence policies, processes and activities conducted to identify and address actual or potential adverse impacts, including the findings and outcomes of those activities. The proposal to amend Directive 2013/34/EU as regards corporate sustainability reporting sets out relevant reporting obligations for the companieundertakings covered by this directive. In order to avoid duplicating reporting obligations, this Directive should therefore not introduce any new reporting obligations in addition to those under Directive 2013/34/EU for the companieundertakings covered by that Directive as well as the reporting standards that should be developed under it. As regards companieundertakings that are within the scope of this Directive, but do not fall under Directive 2013/34/EU, in order to comply with their obligation of communicating as part of the due diligence under this Directive, they should publish on their website an annual statement in a language customary in the sphere of international business. This reporting should be accessible, comparable, and sufficiently detailed to demonstrate the adequacy of a company in undertaking’s due diligence process.
Amendment 439 #
Proposal for a directive
Article 7 – paragraph 2 – introductory part
Article 7 – paragraph 2 – introductory part
2. Companies shall be required to take appropriate measures, including but not limited to the following actions, where relevant:
Amendment 440 #
Proposal for a directive
Recital 44 a (new)
Recital 44 a (new)
(44a) Undertakings should provide stakeholders adequate, comprehensive meaningful information about actual and potential adverse human rights, good governance, environmental and climate impacts and the actions taken to respect their due diligence. Stakeholders should also be able to request additional information from an undertaking regarding the actions taken to comply with the obligations set in this Directive. The confidentiality of commercial and industrial information shall not serve as a bar for access to information that relates to the implementation, by an undertaking, of the provisions of national law transposing this Directive.
Amendment 445 #
Proposal for a directive
Article 7 – paragraph 2 – point a
Article 7 – paragraph 2 – point a
(a) where necessary due to the nature or complexity of the measures required for prevention, develop and implement a prevention action plan, with reasonable and clearly defined timelines for actionppropriate measures and qualitative and quantitative indicators for measuring improvement. The prevention action plan shall be developed in consultation with affected stakeholders;
Amendment 446 #
Proposal for a directive
Recital 46 a (new)
Recital 46 a (new)
(46a) Stakeholders, including workers as well as human rights and environmental rights defenders should be engaged effectively, meaningfully and in a structural manner by undertakings throughout the entire due diligence process. Undertakings should pay special attention to overlapping vulnerabilities and intersecting factors in stakeholder engagement, including by adopting a gender and culturally responsive approach at all times. Undertakings should provide meaningful information to stakeholders about actual and potential adverse human rights, good governance, environmental and climate impacts of particular operations, projects and investments, in a timely and accessible manner taking into account specificities of different stakeholders. Undertakings must respect the rights of Indigenous Peoples, as laid out in the United Nations Declaration on the Rights of Indigenous Peoples, including free, prior and informed consent and indigenous peoples’ right to self-determination.
Amendment 447 #
Proposal for a directive
Recital 47
Recital 47
(47) Although SMEs are not included in the scope of this Directive, they could be impacted by its provisions as contractors or subcontractors to the companies which are in the scope. The aim is nevertheless to mitigate financial or administrative burden on SMEs, many of which are already struggling in the context of the global economic and sanitary crisisThe aim is to mitigate financial or administrative burden on SMEs, while conducting due diligence pursuant to this Directive. In order to support SMEs, Member States should set up and operate, either individually or jointly, dedicated and accessible websites, portals or platforms, and Member States could also financially support SMEs and help them build capacity. Such support should also be made accessible, and where necessary adapted and extended to upstream economic operators in third countries. CompanieUndertakings whose business partner is an SME, are also encouraged to support them to comply with due diligence measures, in case such requirements would jeopardize the viability of the SME and use fair, reasonable, non- discriminatory and proportionate requirements vis-a-vis the SMEs.
Amendment 450 #
Proposal for a directive
Article 7 – paragraph 2 – point b
Article 7 – paragraph 2 – point b
(b) seekobtain contractual and other assurances from a business partner with whom it has a direct business relationship that it will ensures on 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 value chain (contractual cascading). When such contractual assurances are obtained, paragraph 4 shall apply. With regards to contractual assurances, the terms shall be reasonable and non- discriminatory. In case the business relationship is active in one of the sectors referred to in Article 3 point (ca), the assurances shall also include details on ensuring compliance with regards to the risks that are specific to that sector;
Amendment 451 #
Proposal for a directive
Recital 48
Recital 48
(48) In order to complement Member State support to SMEs, the Commission mayshould build on existing EU tools, projects and other actions helping with the due diligence implementation in the EU and in third countries. It mayshould set up new support measures that provide help to companies, includingundertakings, in particular SMEs on due diligence requirements, including an observatory for value chain transparency and the facilitation of joint stakeholder initiatives.
Amendment 453 #
Proposal for a directive
Article 7 – paragraph 2 – point c a (new)
Article 7 – paragraph 2 – point c a (new)
(ca) adapt business models and strategies, including trading, procurement and pricing practices, in order to prevent potential adverse impacts;
Amendment 454 #
Proposal for a directive
Recital 50
Recital 50
(50) In order to ensure that this Directive effectively contributes to combating climate change, companies sundertakings should, in consultation with stakehoulders, adopt a plan to ensure that the business model and strategy of the company are compatibleundertaking are aligned with the transition to a sustainable economy and with the limiting of global warming to 1.5 °C in line with the Paris Agreement. In case climate is or should have been identified as a principal risk for or a principal impact of the company’s operations, the comp and with the objective of achieving climate neutrality by 2050 at the latest as established in Regulation EU 2021/1119 (European Climate Law), in line with the latest recommendations of the IPCC and the European Scientific Advisory Board on Climate Change. The plan should include science-based targets related to climate objectives of 2030 and 2050, avoiding any misleading claims on climate neutrality, an identification and explanation of decarbonisation levers identified within the undertaking’s operations and value chain and the greenhouse gas emission reduction targets. The planys should include emissions reduction objectives in its planclear obligations for directors and board members to ensure that environmental and climate risks and impacts are addressed in the undertaking’s strategy.
Amendment 458 #
Proposal for a directive
Article 7 – paragraph 2 – point e
Article 7 – paragraph 2 – point e
(e) in compliance with Union law including competition law, collaborate with other entities, including, where relevantapplicable, to increase the company’s ability to bring the adverse impact to an end, in particular where no other action is suitable or effective.
Amendment 458 #
Proposal for a directive
Recital 51
Recital 51
(51) With a view to ensure that such emission reducThe climate targets and transition plan ishould be properly implemented and embedded in the financial incentives of directors, the pland should be duly taken into account when setting directors’ variable remuneration, if variable remuneration is linked to the contribution of a director to the company’s business strategy and long- term interests and sustainability.
Amendment 462 #
Proposal for a directive
Article 7 – paragraph 2 a (new)
Article 7 – paragraph 2 a (new)
2a. The appropriate measures should apply to a company’s own operations, products and services, their subsidiaries as well as direct and indirect business relationships.
Amendment 463 #
Proposal for a directive
Recital 54 a (new)
Recital 54 a (new)
(54a) Under Article18(2) of Directive 2014/24/EU, Article 36(2) of Directive 2014/25/EU and Article 30(3) of Directive 2014/23/EU, Member States are required to take appropriate measures to ensure compliance with obligations under Union law. Therefore this Directive should lay down further requirements to specify the measures Member States can adopt to ensure compliance with the obligations under this Directive throughout procurement processes, from selection to performance of the contract. Necessary measures should include but should not be limited to the requirement for undertakings to prove compliance with the obligations laid down under this Directive by submitting evidence and supporting documents.
Amendment 464 #
Proposal for a directive
Article 7 – paragraph 3
Article 7 – paragraph 3
Amendment 468 #
Proposal for a directive
Recital 56
Recital 56
(56) In order to ensure effective compensation of victims of adverse impacts, Member States should be required to lay down rules governing the civil liability of companieundertakings for damages arising due to its failure to comply with the due diligence process. The companyundertaking should be liable for damages if they failed to comply with the obligations to prevent and mitigate potential adverse impacts or to bring actual impacts to an end and minimise their extent, and as a result of this failure an adverse impact that should have been identified, prevented, mitigated, brought to an end or its extent minimised through the appropriate measures occurred and led to damage. The undertaking should also be liable for damages that result from adverse human rights, good governance, environmental or climate impacts that should have been identified, prevented, mitigated, brought to an end or their extent minimised by its subsidiaries.
Amendment 471 #
Proposal for a directive
Article 7 – paragraph 4 – subparagraph 2
Article 7 – paragraph 4 – subparagraph 2
When contractual assurances are obtained from, or a contract is entered into, with an SME, the terms used shall be fair, reasonable and non-discriminatory. Where measures to verify compliance are carried out in relation to SMEs, the company shall bear the related cost of the independent third- party verification.
Amendment 473 #
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, because mitigation is not possible or acceptable, or there is no reasonable prospect of change, the company shall be required to refrain from entering into new or extending existing relations with the partner in connection with or in the value chain of which the impact has arisen and shall, where the law governing their relations so entitles them to, take the following. In such cases, the company shall, in consultation with stakeholders, identify and remedy the risks and impacts of their actions, and:
Amendment 475 #
Proposal for a directive
Article 7 – paragraph 5 – subparagraph 1 – point a
Article 7 – paragraph 5 – subparagraph 1 – point a
(a) temporarily suspend commercial relations with the partner in question, while pursuing prevention and minimistigation efforts, if there is reasonable expectation that these efforts will succeed in the short- term;
Amendment 475 #
Proposal for a directive
Recital 57
Recital 57
(57) As regards damages occurring at the level of established indirect business relationships, the liability of the company should be subject to specific conditions. The companyWhen the damage results from adverse impacts caused by business relationships within an undertaking’s value chain, the undertaking should not be liable if it carried out specific due diligence measures. However, it should not be exonerated from liabilunless it can prove that ity throughook and implementing such measures in case it was unreasonable to expect that the action actually taken, including ed effective appropriate meas uregards verifying complis, in accordance, would be adequate to prevent, mitigate, bring to an end or minimise the adverse impactith the Directive, to ensure that the damage would not occur . In addition, in the assessment of the existence and extent of liability, due account is to be taken of the companyundertaking’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 as well as any collaboration with other entities to address adverse impacts in its value chains.
Amendment 478 #
Proposal for a directive
Article 7 – paragraph 5 – subparagraph 1 – point b
Article 7 – paragraph 5 – subparagraph 1 – point b
(b) terminate the business relationship with respect to the activities concerned if the potential adverse impact is severe as well as if the conditions for temporary suspension under point (a) are not met.
Amendment 478 #
Proposal for a directive
Recital 58
Recital 58
Amendment 480 #
Proposal for a directive
Recital 59 a (new)
Recital 59 a (new)
(59a) The right to an effective remedy is an internationally recognised human right, enshrined in Article 8 of the Universal Declaration of Human Rights, Article 9(3) of the Aarhus Convention on Access to Information, Public Participation in Decision-making and Access to Justice in Environmental Matters and Article 2(3)of the International Covenant on Civil and Political Rights, and is also a fundamental right of the Union within the meaning of Article 47 of the Charter. Delays and difficulties in accessing evidence, as well as gender disparity, geographical location, vulnerabilities and marginalisation can constitute major practical and procedural obstacles for the persons concerned, hindering their access to an effective remedy without fear of reprisals. Member States should thus ensure that victims have access to an effective remedy and that the costs and the length of the proceedings do not prevent claimants from access to courts. These measures may, for example, take the form of public funding, including structural support for victims of actual and potential adverse impacts, limitation of applicable court or administrative fees, or access to legal aid.
Amendment 481 #
Proposal for a directive
Article 7 – paragraph 5 – subparagraph 2
Article 7 – paragraph 5 – subparagraph 2
Member States shall provide for the availability of an option to suspend or terminate the business relationship in contracts governed by their laws.
Amendment 481 #
Proposal for a directive
Recital 59 b (new)
Recital 59 b (new)
(59b) The most significant barriers to access to justice for victims of adverse impacts is the difficulty in proving the undertaking failure to meet its obligations. In case of a civil liability claim for damages and when prima facie elements are provided by the claimants, the causal link between the damage and the undertaking’s failure to comply should be presumed and the respondent should have to prove it has complied with its obligations and that appropriate measures were taken.
Amendment 482 #
Proposal for a directive
Recital 59 c (new)
Recital 59 c (new)
(59c) Trade unions, civil society organisations or other relevant actors acting in the public interest, such as National Human Rights Institutions or an Ombudsman, should be able to bring representative actions before their courts on behalf and for the protection of the collective interests of victims of actual and potential adverse impacts, and that these entities have the rights and obligations of a claimant party in the proceedings.
Amendment 483 #
Proposal for a directive
Article 7 – paragraph 6
Article 7 – paragraph 6
Amendment 487 #
Proposal for a directive
Recital 64
Recital 64
(64) Responsibility for due diligence should be assigned to the company’undertaking's directors, in line with the international due diligence frameworks. Directors should therefore be responsible for putting in place and overseeing the due diligence actions as laid down in this Directive and for adopting the company’undertaking's due diligence policy, taking into account the input of stakeholders and civil society organisations and integrating due diligence into corporate management systems. Directors should also adapt the corporate strategy to actual and potential impacts identified and any due diligence measures taken. Since the term ‘director’ in this Directive covers any member of the administrative, management or supervisory bodies, Member States should ensure that, where applicable, the duty of care does not undermine the responsibilities of workers’ representatives on boards.
Amendment 488 #
Proposal for a directive
Article 7 – paragraph 6 a (new)
Article 7 – paragraph 6 a (new)
6a. In the event that a company is not in a position to prevent at the same time all the potential adverse impacts identified, it shall develop and implement a prioritisation strategy in consultation with all stakeholders, which shall take into account the level of severity, likelihood and reversibility of the different potential adverse impacts on human rights, the environment and climate.
Amendment 489 #
Proposal for a directive
Recital 65
Recital 65
(65) Persons who work for companieundertakings subject to due diligence obligations under this Directive or who are in contact with such companieundertakings in the context of their work-related activities can play a key role in exposing breaches of the rules of this Directive. They can thus contribute to preventing and deterring such breaches and strengthening the enforcement of this Directive. Directive (EU) 2019/1937 of the European Parliament and of the Council106 should therefore apply to the reporting of all breaches of this Directive and to the protection of persons reporting such breaches. In particular, stakeholders submitting complaints or concerns should be effectively protected, notably by ensuring the confidentiality and anonymity of the complaint or concern raised. Stakeholders should also be protected against strategic lawsuits against public participation. _________________ 106 Directive (EU) 2019/1937 of the European Parliament and of the Council of 23 October 2019 on the protection of persons who report breaches of Union law (OJ L 305, 26.11.2019, p. 17).
Amendment 490 #
Proposal for a directive
Recital 65 a (new)
Recital 65 a (new)
(65a) Human rights and environmental rights defenders are on the front line of the consequences of adverse environmental, climate, human rights and good governance impacts worldwide and in the EU, and may be directly threatened, intimidated, persecuted, harassed or even murdered, and as such should also benefit from balanced and effective protection. Undertakings should measure the actual and potential risks of their activities, as well as contextual risks to human rights and environmental rights defenders, engage with them and publish a policy on defenders that includes a zero-tolerance stance on threats or violence against them. Company policies must explicitly include in their due diligence protocols for safeguarding the rights of land and environmental rights defenders.
Amendment 492 #
Proposal for a directive
Recital 69
Recital 69
(69) This Directive is without prejudice to obligations in the areas of human rights, good governance, protection of the environment and climate change under other Union legislative acts. If the provisions of this Directive conflict with a provision of another Union legislative act pursuing the same objectives and providing for more extensive or more specific obligations, the provisions of the other Union legislative act should prevail to the extent of the conflict and shall apply to those specific obligations. Such acts include, but are not limited to existing as well as future EU legislation regarding timber and deforestation, posting of workers and forced labour
Amendment 494 #
Proposal for a directive
Article 8 – paragraph 2
Article 8 – paragraph 2
2. Where the adverse impact cannot immediately be brought to an end, Member States shall ensure that companies minimise the extent of such an impact, while continuing to pursue all efforts to bring the adverse impact to an end.
Amendment 494 #
Proposal for a directive
Recital 70
Recital 70
(70) The Commission should assess and report on a regular basis whether new sectors should be added to the list of high- impact sectors covered by this Directive, in order to align it to guidance from the Organisation for Economic Cooperation and Development or in light of clear evidence on labour exploitation, human rights violations, bad governance, or newly emerging environmental and climate threats, whether the list of relevant international conventions referred to in this Directive should be amended, in particular in the light of international developments, or whether the provisions on due diligence under this Directive should be extended to adverse climate impacts.
Amendment 496 #
Proposal for a directive
Article 8 – paragraph 3 – introductory part
Article 8 – paragraph 3 – introductory part
3. CIn order to comply with paragraphs 1 and 2 of this Article, companies shall be required to take the following actions, where relevant:
Amendment 498 #
Proposal for a directive
Article 1 – paragraph -1 (new)
Article 1 – paragraph -1 (new)
-1. This Directive aims to ensure that undertakings respect human rights and good governance and protect the environment and the climate within their own operations, products and services, and those of their subsidiaries, and value chains.
Amendment 499 #
Proposal for a directive
Article 1 – paragraph -1 a (new)
Article 1 – paragraph -1 a (new)
-1a. This Directive shall contribute to the safeguarding of the planetary boundaries at Union level and worldwide.
Amendment 501 #
Proposal for a directive
Article 8 – paragraph 3 – point a
Article 8 – paragraph 3 – point a
(a) neutralise the adverse impact or minimise its extent, including by the payment of damages to the affected persons and of financial compensation to the affected communities. The action shall be proportionate to the significance andby appropriate measures. In the event these measures are accompanied by financial compensation paid by companies for adverse impacts resulting from business relationships, companies schale of the adverse impact and to the contribul benefit from legal assurance to obtain compensation ofrom the company’s conduct to the adverse impactpartners concerned;
Amendment 502 #
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 and measures with reasonable and clearly defined timelines for action, measures and qualitative and quantitative indicators for measuring improvement. Where relevant, tThe action shall be proportionate to the significance and scale of the adverse impact and to the contribution of the company’s conduct to the adverse impact. This is without prejudice to the possibility for Member States to uphold or introduce joint and several liability for different companies with a shared responsible for an adverse impact. The corrective action plan shall be developed in consultation with stakeholders and shall be publicly available;
Amendment 504 #
Proposal for a directive
Article 1 – paragraph 1 – subparagraph 1 – point a
Article 1 – paragraph 1 – subparagraph 1 – point a
(a) on obligations for companieundertakings regarding actual and potential human rights adverse impacts and, good governance, environmental and climate adverse impacts, with respect to their own operations, the operationproducts and services, the operations, products and services of their subsidiaries, and the value chain operations carried out by entities with whom the company has an establishedundertaking has a business relationship and
Amendment 507 #
Proposal for a directive
Article 8 – paragraph 3 – point c
Article 8 – paragraph 3 – point c
(c) seekobtain 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 value chain (contractual cascading). When such contractual assurances are obtained, paragraph 5 shall apply.nd other assurances regarding it business relationships with respect to the implementation to a corrective action plan. With regards to contractual assurances, the terms shall be reasonable and non- discriminatory. In case the business relationship is active in one of the sectors referred to in Article 3 point (ca), the assurances shall also include details on ensuring compliance with regards to the risks that are specific to that sector;
Amendment 512 #
Proposal for a directive
Article 8 – paragraph 3 – point d a (new)
Article 8 – paragraph 3 – point d a (new)
(da) adapt business models and strategies, including trading, procurement and pricing practices, in order to bring to an end or minimise actual adverse impacts;
Amendment 514 #
Proposal for a directive
Article 1 – paragraph 1 – subparagraph 1 – point b a (new)
Article 1 – paragraph 1 – subparagraph 1 – point b a (new)
(ba) on access to justice for victims of the obligations mentioned above.
Amendment 515 #
Proposal for a directive
Article 8 – paragraph 3 – point f
Article 8 – paragraph 3 – point f
(f) in compliance with Union law including competition law, collaborate with other entities, including, where relevantapplicable, to increase the company’s ability to bring the adverse impact to an end, in particular where no other action is suitable or effective.
Amendment 515 #
Proposal for a directive
Article 1 – paragraph 1 – subparagraph 2
Article 1 – paragraph 1 – subparagraph 2
Amendment 516 #
Proposal for a directive
Article 8 – paragraph 3 a (new)
Article 8 – paragraph 3 a (new)
3a. These measures and actions shall apply, where applicable, to a company’s own operations, subsidiaries as well as direct and indirect business relationships.
Amendment 517 #
Proposal for a directive
Article 8 – paragraph 4
Article 8 – paragraph 4
Amendment 520 #
Proposal for a directive
Article 8 – paragraph 5 – subparagraph 1
Article 8 – paragraph 5 – subparagraph 1
Amendment 524 #
Proposal for a directive
Article 1 – paragraph 2
Article 1 – paragraph 2
2. This Directive shall not constitute grounds for reducing the level of protection of human rights or of protection of, good governance, the environment or the protection of the climate provided for by the law of Member States at the time of the adoption of this Directive.
Amendment 525 #
Proposal for a directive
Article 8 – paragraph 5 – subparagraph 2
Article 8 – paragraph 5 – subparagraph 2
When contractual assurances are obtained from, or a contract is entered into, with an SME, the terms used shall be fair, reasonable and non-discriminatory. Where measures to verify compliatrack efficiencey are carried out in relation to SMEs, the company shall bear the cost of the independent third- party verificationassociated costs.
Amendment 535 #
Proposal for a directive
Article 2 – paragraph 1 – introductory part
Article 2 – paragraph 1 – introductory part
1. This Directive shall apply to companieundertakings which are formed in accordance with the legislation of a Member State and which fulfil , with the exceptione of the following conditions:micro-enterprises as defined by article 3(1) of Directive 2013/34/EU.
Amendment 536 #
Proposal for a directive
Article 8 – paragraph 7
Article 8 – paragraph 7
Amendment 538 #
Proposal for a directive
Article 2 – paragraph 1 – point a
Article 2 – paragraph 1 – point a
Amendment 540 #
Proposal for a directive
Article 8 – paragraph 7 a (new)
Article 8 – paragraph 7 a (new)
7a. In the event that the company is not in a position to neutralise or correct all the actual adverse impacts at the same time, a prioritisation strategy shall be developed and implemented, which takes into account the level of severity, likelihood and reversibility of the different actual adverse impacts on human rights, the environment and climate.
Amendment 550 #
Proposal for a directive
Article 9 – paragraph 2 – introductory part
Article 9 – paragraph 2 – introductory part
2. Member States shall ensure that the complaints or grievances may be submitted by: all persons, groups, communities, entities and organisations covered by Article 2 points (n), (ha) and (hb) as well as the natural and legal persons representing them, including in particular trade unions and other workers’ representatives.
Amendment 550 #
Proposal for a directive
Article 2 – paragraph 1 – point b
Article 2 – paragraph 1 – point b
Amendment 552 #
Proposal for a directive
Article 9 – paragraph 2 – point a
Article 9 – paragraph 2 – point a
Amendment 558 #
Proposal for a directive
Article 9 – paragraph 2 – point b
Article 9 – paragraph 2 – point b
Amendment 564 #
Proposal for a directive
Article 9 – paragraph 2 – point c
Article 9 – paragraph 2 – point c
Amendment 590 #
Proposal for a directive
Article 9 a (new)
Article 9 a (new)
Article 9a Stakeholder Engagement 1. Member States shall ensure that companies effectively and meaningfully engage stakeholders, including human rights and environmental defenders, in fulfilling their obligations pursuant to Articles 4-11. Companies shall be required to ensure: (a) stakeholder engagement covers information, consultation and participation and takes places on a structural and regular basis throughout the entire due diligence process ; (b) comprehensive and meaningful information is provided to stakeholders in accordance with Article 11; (c) effective and appropriate frameworks, measures and tools of engagement are put in place, including but not limited to: (i) setting reasonable and appropriate timelines; (ii) identifying and addressing potential barriers to participation; (iii) providing adequate protection of stakeholders from the risk of retaliation; (iv) implementing an action plan to proactively seek the engagement of stakeholders in a marginalised or vulnerable situation; and (d) ad-hoc and pro-active engagement with stakeholders is initiated in case of significant changes in operations, activities or operating context. (e) a gender- and culturally- responsive approach in ensured at all times; 2. Member States shall ensure that, when stakeholders request to be included in the engagement outlined in paragraph 1, companies assess and respond to these requests and that they provide a detailed justification in case the request is denied. 3. The engagement of workers and workers’ representatives shall be without prejudice to Directives2002/14/EC and 2009/38/EC of the European Parliament and of the Council and Council Directive 2001/86/EC.
Amendment 591 #
Proposal for a directive
Article 10 – title
Article 10 – title
Tracking and Monitoring
Amendment 594 #
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 value 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,to track the implementation and monitor the effectiveness of the actions taken in accordance with Article 4. Such assessments shall be carried out in consultation with stakeholders, based 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. For companies operating in one of the sectors referred to in Article 3 point (ca), the assessments shall also provide detail with regards to the risks that are specific to that sector. The due diligence policy, the prevention action plan and the corrective action plan shall be updated in accordance with the outcome of those assessments.
Amendment 594 #
Proposal for a directive
Article 2 – paragraph 1 a (new)
Article 2 – paragraph 1 a (new)
1a. This Directive shall also apply to EU Member states’ Export Credit Agencies covered in Regulation (EU) No 1233/2011.
Amendment 595 #
Proposal for a directive
Article 2 – paragraph 2 – introductory part
Article 2 – paragraph 2 – introductory part
2. This Directive shall also apply to companielarge as well as listed small and medium- sized undertakings which are formed in accordance with the legislation of a third country, and fulfil one of the following conditions: have generated a net turnover of more than EUR 8 million in the financial year preceding the last financial year.
Amendment 598 #
Proposal for a directive
Article 11 – title
Article 11 – title
Communication and Access to Informationg
Amendment 600 #
Proposal for a directive
Article 11 – paragraph 1
Article 11 – paragraph 1
Member States shall ensure that companies that are not subject to reporting requirements under Articles 19a and 29a of Directive 2013/34/EU report on the matters covered by this Directive by publishing on their website an annual statement that meets those requirements in a language customary in the sphere of international business. This reporting should be accessible, comparable, and sufficiently detailed to demonstrate the adequacy of a company’s due diligence process as per this Directive. The statement shall be published by 30 April each year, covering the previous calendar year.
Amendment 601 #
Proposal for a directive
Article 2 – paragraph 2 – point a
Article 2 – paragraph 2 – point a
Amendment 604 #
Proposal for a directive
Article 11 – paragraph 2 a (new)
Article 11 – paragraph 2 a (new)
Member States shall ensure that companies provide, adequate, comprehensive and meaningful information to stakeholders about actual and potential adverse human rights, environmental and climate impacts and about the actions taken in accordance with this Directive with regards to particular operations, projects and investments. This information shall be provided in written and in a timely, accessible and gender and culturally responsive manner, taking into account specifics of the stakeholder group.
Amendment 605 #
Proposal for a directive
Article 11 – paragraph 2 b (new)
Article 11 – paragraph 2 b (new)
In cases of significant changes in operations, activities or operating context, Member States shall ensure that companies shall proactively communicate to stakeholders and provide complementary and intermediary information.
Amendment 606 #
Proposal for a directive
Article 11 – paragraph 2 c (new)
Article 11 – paragraph 2 c (new)
Amendment 607 #
Proposal for a directive
Article 11 – paragraph 2 d (new)
Article 11 – paragraph 2 d (new)
Member States shall ensure that the confidentiality of commercial and industrial information, as established under national legislation, shall not serve as a barrier for access to information that relates to the application of this Directive. Grounds for refusal of disclosure shall be interpreted in a restrictive way, taking into account the public interest served by disclosure and the objectives of this Directive.
Amendment 610 #
Proposal for a directive
Article 13 – paragraph 1
Article 13 – paragraph 1
In order to provide support to companies or to Member State authorities on how companies should fulfil their due diligence obligations, the Commission, in consultation with Member States and stakeholders, the European Union Agency for Fundamental Rights, the European Environment Agency, and where appropriate with international bodies having expertise in due diligence, mayshall issue guidelines, including for specific sectors or specific adverse impacts. adverse impacts and in particular for the sectors referred to in Article 3 point (ca). The issues to be addressed by the guidelines shall include the specific obligations under Articles 5 to 11 of this Directive as well as: (a) contexts, such as situations of conflict or occupation; (b) responsible purchasing practices; (c) gender-responsive due diligence; (d) resource and information sharing among companies and other legal entities for the purposes of preventing, mitigating and remediating adverse impacts incompliance with competition law; (e) measures that companies should take to address the challenges faced by smallholders, including access to a living income; (f) responsible disengagement.
Amendment 610 #
Proposal for a directive
Article 2 – paragraph 2 – point b
Article 2 – paragraph 2 – point b
Amendment 624 #
Proposal for a directive
Article 15 – title
Article 15 – title
Combating climate changelimate targets and transition plans
Amendment 625 #
Proposal for a directive
Article 2 – paragraph 3
Article 2 – paragraph 3
3. For the purposes of paragraph 1, the number of part-time employeeworkers shall be calculated on a full-time equivalent basis. Temporary agency workers and other workers in non-standard forms of employment, such as on-call work, multiparty employment relationships, disguised employment and dependent self- employed, shall be included in the calculation of the number of employees in the same way as if they were workers employed directly for the same period of time by the companyundertaking.
Amendment 631 #
Proposal for a directive
Article 15 – paragraph 1
Article 15 – paragraph 1
1. Member States shall ensure that companies referred to in Article 2(1), point (a), and Article 2(2), point (a), shall adop shall, in consultation with stakeholders, adopt, develop and implement a plan to ensure that the business model and strategy of the company are compatiblealigned with the transition to a sustainable economy and with the limiting of global warming to 1.5 °C in line with the Paris Agreement. This plan shall, in particular, identify, on the basis of information reasonably available to the company, the extent to which climate change is a risk for, or an impact of, the company’s operations and with the objective of achieving climate neutrality by 2050 at the latest, as established in Regulation EU 2021/1119 (European Climate Law), pursuant to the latest recommendations of the IPCC and the European Scientific Advisory Board on Climate Change.
Amendment 636 #
Proposal for a directive
Article 15 – paragraph 1 a (new)
Article 15 – paragraph 1 a (new)
1a. This plan shall take into account the entire value chain and include: (a) a description of the time-bound, short-, medium-, and long-term targets related to their climate objectives for at least 2030 and 2050, including interim targets, including absolute greenhouse gas emission reduction targets for scope 1, 2 and 3 and avoiding any misleading neutrality or other misleading claims. These targets should be science-based and regularly updated in line with the best available science and take into account the entire value chain, reviewed every five years up to 2050 in line with the limiting of global warming to 1.5°C and the Paris Agreement; (b) an identification and explanation of decarbonisation levers identified within the company’s operations and value chain, and related financial and investment plans; (c) implementing actions and a description of the progress made to achieve these short-, medium-, and long- term climate targets covering each of their scope 1, 2 and 3 emissions globally, with a of prioritisation of decarbonisation, GHG reduction and the closure of carbon intensive asset over their sale to third parties, including in developing countries.
Amendment 641 #
Proposal for a directive
Article 3 – paragraph 1 – point a – introductory part
Article 3 – paragraph 1 – point a – introductory part
(a) ‘companyundertaking’ means any of the following entities, including directly and indirectly-owned subsidiaries and branches, where applicable, irrespective of the legal form of the mother entity:
Amendment 644 #
Proposal for a directive
Article 3 – paragraph 1 – point a – point i
Article 3 – paragraph 1 – point a – point i
(i) a legal person constituted as one of the legal forms listed in Annex I and II to Directive 2013/34/EU of the European Parliament and of the Council110 ; _________________ 110 Directive 2013/34/EU of the European Parliament and of the Council of 26 June 2013 on the annual financial statements, consolidated financial statements and related reports of certain types of undertakings (OJ L 182, 29.6.2013, p. 19).
Amendment 646 #
Proposal for a directive
Article 15 – paragraph 2
Article 15 – paragraph 2
2. Member States shall ensure that, in case climate change is or should have been identified as a principal risk for, or a principal companies referred to in Article 2 shall develop a clear, transparent, accurate, total, comparable and consistent plan, following the best practices. This plan shall in particular take into account, and seek to prevent and mitigate, adverse impacts of, the company’s operations, the company includes emission reduction objec implementing actions on potentially affected groups including workers, local communitives in its planand other stakeholders.
Amendment 654 #
Proposal for a directive
Article 15 – paragraph 3
Article 15 – paragraph 3
3. Member States shall ensure that companies duly take into account the fulfilment of the obligations referred to in paragraphs 1 and 2 when setting variable remuneration, if variable remuneration is linked to the contribution of a director to the company’s business strategy and long- term interests and sustainabilitreferred to in Article 2 shall integrate these targets and implementing actions into the business strategy and backed up by clear governance processes, including the involvement of stakeholders. Member States shall ensure that boards have an obligation to ensure that environmental and climate risks and impacts are addressed in the company’s strategy.
Amendment 656 #
Proposal for a directive
Article 15 – paragraph 3 a (new)
Article 15 – paragraph 3 a (new)
3a. Member States shall ensure that companies align a significant part of director’s variable remuneration with the achievement of their climate targets and plans, in particular absolute greenhouse gas emission reduction targets for scope 1, 2 and 3. Directors shall be liable for achieving climate objectives and thus for overseeing the obligations set out in paragraphs 1 and 1a of this Article.
Amendment 658 #
Proposal for a directive
Article 3 – paragraph 1 – point a – point iv – indent 19 a (new)
Article 3 – paragraph 1 – point a – point iv – indent 19 a (new)
— a market operator as defined in article 4(1) (18) of Directive 2014/65/EU
Amendment 659 #
Proposal for a directive
Article 16 – paragraph 2
Article 16 – paragraph 2
2. Member States shall ensure that the name, address, electronic mail address and telephone number of the authorised representative is notified to a supervisory authority in the Member State where the authorised representative is domiciled or established. Member States shall ensure that the authorised representative is obliged to provide, upon request, a copy of the designation in an official language of a Member State to any of the supervisory authorities. Member States shall publish an up to date list of authorised representatives under their jurisdiction.
Amendment 662 #
Proposal for a directive
Article 17 – paragraph 7 a (new)
Article 17 – paragraph 7 a (new)
7a. Member States shall ensure that supervisory authorities have the appropriate qualification, experience and skills in relation to human rights, environment and climate to perform its duties and exercise its powers.
Amendment 663 #
Proposal for a directive
Article 17 – paragraph 8 a (new)
Article 17 – paragraph 8 a (new)
8a. Member States shall ensure that supervisory authorities publish and make available an annual report detailing their past activities, future work plan and priorities. This includes reporting on closed investigations and their results, potential sanctions or other decisions on investigations.
Amendment 665 #
Proposal for a directive
Article 3 – paragraph 1 – point b
Article 3 – paragraph 1 – point b
(b) ‘adverse environmental impact’ means an adverse impact on the environment resulting from the violation of one of the prohibitions and obligations pursuantand climate impact’ means: (i) contributing to the exceeding of planetary boundaries; (ii) an adverse impact on the following elements or functions of ecosystems and the interrelations between them: (a) climate, including but not limited to greenhouse gas emissions and the destruction or degradation of sinks; (b) air and the atmosphere, including but not limited to air pollution; (c) water and access to water, including but not limited to, water use, water pollution, water quantities and depletion of freshwater; (d) soil, including but not limited to, soil pollution, soil erosion, land use and land degradation, soil contamination from waste disposal and treatment; (e) biodiversity, including but not limited to, damage to wildlife, flora, seabed and marine environment, natural habitats and ecosystems; (f) hazardous substances; (g) energy use; (h) the transition to a circular economy, including but not limited to impairment to reusability and recyclability; (i) light, noise and vibration, including but not limited to noise and light pollution; (j) human health in accordance with the ‘One Health’ approach and the right to a healthy environment, including but not limited to occupational health, safety and the deterioration of working conditions due to climate change or the exceeding of planetary boundaries, such as the rise of temperatures to an unbearable level for their workers. (iii) an adverse impact on the environment or climate resulting from the violation of one of the prohibitions and obligations established under international environmental and climate instruments, including but not limited to the international environmental and climate conventions listed in the Annex, Part II;
Amendment 673 #
Proposal for a directive
Article 3 – paragraph 1 – point b a (new)
Article 3 – paragraph 1 – point b a (new)
(ba) ‘Science-based target’ ‘Science- based target’ means a target of the undertaking's operations and its value chains defined on the basis of conclusive scientific evidence and with independent scientific validation, that is consistent with a 1.5°C climate scenario as defined by the IPCC;
Amendment 674 #
Proposal for a directive
Article 3 – paragraph 1 – point b b (new)
Article 3 – paragraph 1 – point b b (new)
(bb) 'Planetary boundaries' means climate change, biosphere integrity (functional and genetic),land- system changes, freshwater use, biogeochemical flows (nitrogen and phosphorus), ocean acidification, atmospheric aerosol pollution, stratospheric ozone depletion, and release of chemicals as defined by the Stockholm Resilience Centre;
Amendment 677 #
Proposal for a directive
Article 3 – paragraph 1 – point c
Article 3 – paragraph 1 – point c
(c) ‘adverse human rights impact’ means an adversy negative impact on protected persons resulting from the violation of one of the rights or prohibitionsthe enjoyment of rights, notably those listed in the Annex, Part I Section 1, and the violation of the rights enshrined in the international conventions listed in the Annex, Part I Section 2;
Amendment 678 #
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: (a) the company’s efforts to comply with any remedial action required of them by a supervisory authority,; (b) any investments made and any targeted support provided pursuant to Articles 7 and 8,; as well as (c) any collaboration with other entities to address adverse impacts in its value chains, as the case may be; (d) the severity and duration of the company’s infringement, or the severity of the impacts that have occurred; (e) any previous infringements by the company and its subsidiaries; (f) the financial benefits gained or losses avoided by the company or its subsidiaries due to the infringement, if the relevant data are available; (g) penalties imposed in respect of the same infringement in other Member States; (h) the degree to which the company has dealt with complaints or proposals raised by stakeholders, including through grievance mechanisms under Article 9; (i) whether or not the company is active in one of the sectors referred to in article 3 point (ca); (j) any other aggravating or mitigating factors applicable to the circumstances of the case.
Amendment 680 #
Proposal for a directive
Article 3 – paragraph 1 – point c a (new)
Article 3 – paragraph 1 – point c a (new)
(ca) ‘adverse good governance impact’ means any negative impact on the rule of law, the functioning of public administration and services, democratic political structures and electoral systems, and the violation of one of the prohibitions and obligations covered by international instruments, including but not limited to those listed in Part IIa of the Annex to this Directive.
Amendment 682 #
Proposal for a directive
Article 20 – paragraph 2 a (new)
Article 20 – paragraph 2 a (new)
2a. Sanctions can be pecuniary, or may further include but should not be limited to: specific performance, exclusion from public procurement, export credits, trade missions and advisory bodies to governments.
Amendment 683 #
Proposal for a directive
Article 3 – paragraph 1 – point c b (new)
Article 3 – paragraph 1 – point c b (new)
Amendment 685 #
Proposal for a directive
Article 20 – paragraph 3
Article 20 – paragraph 3
3. When pecuniary sanctions are imposed, they shall be based on the company’s turnover. The minimum limit of pecuniary sanctions shall be 5% of the total world wide turnover of the company in the business year preceding the decision on the pecuniary sanctions.
Amendment 686 #
Proposal for a directive
Article 3 – paragraph 1 – point c c (new)
Article 3 – paragraph 1 – point c c (new)
(cc) ‘conflict-affected and high-risk areas’ means areas in a state of armed conflict or fragile post-conflict, areas under occupation and/or annexation, as well as areas witnessing weak or non- existent governance and security, such as failed states, and widespread and severe violations of international humanitarian and/or human rights law;
Amendment 690 #
Proposal for a directive
Article 20 – paragraph 4
Article 20 – paragraph 4
Amendment 693 #
Proposal for a directive
Article 20 – paragraph 4 a (new)
Article 20 – paragraph 4 a (new)
4a. Supervisory Authorities shall publish and regularly update a list of all companies subject to this Directive and maintain a publicly available and regularly updated record of companies that have not published a statement as pursuant to Article11.
Amendment 695 #
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 withbetween the undertaking and a subsidiary, a contractor, subcontractor or any other legal entities , governmental or otherwise, within their value chain(‘partner’)
Amendment 698 #
Proposal for a directive
Article 22 – paragraph 1 – point a
Article 22 – paragraph 1 – point a
(a) they failed to comply with the obligations laid down in Articles 7 and 8this Directive and;
Amendment 698 #
Amendment 700 #
Proposal for a directive
Article 22 – paragraph 1 – point b
Article 22 – paragraph 1 – point b
(b) as a result of this failure an adverse impact that should have been identified, prevented, mitigated, brought to an end or its extent minimised through the appropriate measures laid down in Articles 7 and 8this Directive occurred and led to damage.
Amendment 701 #
Proposal for a directive
Article 22 – paragraph 1 a (new)
Article 22 – paragraph 1 a (new)
1a. Member States shall ensure that companies are liable for damages that result from adverse human rights, environmental and climate impacts arising as a result of the activities of a subsidiary and, that should have been identified, prevented, mitigated, brought to an end or their extent minimised by their subsidiaries under this Directive.
Amendment 701 #
Proposal for a directive
Article 3 – paragraph 1 – point e – point ii
Article 3 – paragraph 1 – point e – point ii
Amendment 702 #
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 notshall be liable for damages caused bythat result from an adverse impact arising as a result of the activities of an indirect partner with whom it has an established business relationship, unless it was unreasonable, in they circumstances of the case, to expect that the action actually taken, including an prove they took appropriate meas uregards verifying compliance, would be adequate tos capable of preventing, mitigate, bring or bringing to an end or minimiseing the extent of the adverse impact.
Amendment 704 #
Proposal for a directive
Article 22 – paragraph 2 – subparagraph 2 a (new)
Article 22 – paragraph 2 – subparagraph 2 a (new)
Where there is a civil liability claim for damages in accordance with Article 22 paragraph 1 and 2, and the claimant provides prima facie elements substantiating the likelihood of the company's liability under the Directive, Member States shall take such measures as are necessary to ensure that the causal link between the damage and the company’s failure to comply is presumed, and that it shall be for the company to prove it has complied with its obligations as laid down in the Directive and that the measures it took were appropriate. Where claimants have provided reasonably available evidence sufficient to support their action in accordance to paragraph 1, Member States shall ensure that courts are enabled to order the defendant and third parties to disclose any evidence in their control, including evidence related to the nature of business relationships or the structure of the company, if requested by the claimant and in accordance with national procedural law, subject to the applicable Union and national rules on confidentiality and proportionality.
Amendment 707 #
Proposal for a directive
Article 22 – paragraph 4
Article 22 – paragraph 4
4. The civil liability rules under this Directive shall 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 Directiveneither exclude nor limit companies' liability under Union or national rules regarding civil liability.
Amendment 708 #
Proposal for a directive
Article 3 – paragraph 1 – point f
Article 3 – paragraph 1 – point f
Amendment 709 #
Proposal for a directive
Article 22 – paragraph 5
Article 22 – paragraph 5
5. Member States shall ensure that the liability provided for in provisions of national law transposing this Article is of overriding mandatory application in cases where the law applicable to claims to that effect is not the law of a Member StateDirective shall apply irrespective of the law otherwise applicable to companies, to contractual obligations and to non- contractual obligations.
Amendment 710 #
Proposal for a directive
Article 22 – paragraph 5 a (new)
Article 22 – paragraph 5 a (new)
Amendment 712 #
Proposal for a directive
Article 22 – paragraph 5 b (new)
Article 22 – paragraph 5 b (new)
5b. Member States shall take measures to ensure the right to an effective remedy and that to ensure that the costs and the length of the proceedings under national law do not prevent claimants from access to courts. These measures may, for example, take the form of public funding, including structural support for victims of actual and potential adverse impacts, limitation of applicable court or administrative fees, or access to legal aid.
Amendment 713 #
Proposal for a directive
Article 22 – paragraph 5 c (new)
Article 22 – paragraph 5 c (new)
5c. Member States shall ensure that trade unions and civil society organisations or other relevant actors acting in the public interest can bring representative actions before their courts on behalf and for the protection of the collective interests of victims of actual and potential adverse impacts, and that these entities have the rights and obligations of a claimant party in the proceedings.
Amendment 714 #
Proposal for a directive
Article 22 – paragraph 5 d (new)
Article 22 – paragraph 5 d (new)
5d. Member States shall ensure that the law applicable to non-contractual obligations arising from paragraphs 1 and 2 of this Article shall be the law determined by virtue of the Rome 2 Regulation, unless the plaintiff chooses to base his or her claim on the law of the country in which the event giving rise to the damage occurred. Article17 of the Rome 2 Regulation cannot be invoked by the defendant to exonerate or limit their liability.
Amendment 715 #
Proposal for a directive
Article 22 – paragraph 5 e (new)
Article 22 – paragraph 5 e (new)
5e. Member States shall ensure that victims of actual and potential adverse impacts and any stakeholder with a legitimate interest are entitled to seek injunctive measures before Union courts. These shall be available in the form of a provisional or a definitive measure to cease a practice that may constitute a breach of this Directive, or in the form of a provisional or a definitive measure to take effective actions to comply with this Directive.
Amendment 717 #
Proposal for a directive
Article 23 – title
Article 23 – title
Amendment 719 #
Proposal for a directive
Article 23 – paragraph 1
Article 23 – paragraph 1
Amendment 721 #
Proposal for a directive
Article 23 – paragraph 1 a (new)
Article 23 – paragraph 1 a (new)
Member States shall take the necessary measures to ensure that all stakeholder engagement procedures, and in particular those set in place to raise complaints or concerns, shall allow the confidentiality of those concerns, as well as the anonymity and safety and physical and legal integrity of all stakeholders and complainants, including human rights and environmental defenders. In the event that such procedures concern whistleblowers, those procedures should be in line with Directive (EU) 2019/1937 of the European Parliament and of the Council.
Amendment 723 #
Proposal for a directive
Article 23 – paragraph 1 b (new)
Article 23 – paragraph 1 b (new)
Member States shall take the necessary measures to ensure that stakeholders, including human rights and environmental defenders, and other reporting persons are protected against Strategic Lawsuit against public participation.
Amendment 723 #
Proposal for a directive
Article 3 – paragraph 1 – point g
Article 3 – paragraph 1 – point g
(g) ‘value chain’ means activll upstream and downstream activities, operations and entities related to the production, distribution or sale of goods or the provision of services by a companythe undertaking, its subsidiaries or undertakings in which it holds a minority shareholding, including the development of the product or the service and the use, waste management and disposal of the product as well as the related activities of upstream and downstream established business relationships of the companyundertaking or its subsidiaries. As regards companieundertakings within the meaning of point (a)(iv), ‘value chain’ with respect to the provision of these specific services shall only include, but not be limited to, the activities of the clients receiving such loan, credit, financing, investment, pensions, securitisation, insurance and reinsurance, market funding, risk management, payment services and other financial services and of other companieundertakings belonging to the same group whose activities are linked to the contract in question. The value chain of such regulated financial undertakings does not cover SMEs receiving loan, credit, financing, insurance or reinsurance of such entitihouseholds and natural persons not acting in a professional and business capacity receiving loan, credit, financing, insurance or reinsurance of such entities, pensions, securitisation, market funding, risk management, payment service and other financial services;
Amendment 734 #
Proposal for a directive
Article 25 – paragraph 1
Article 25 – paragraph 1
1. Member States shall ensure that, when fulfilling their duty to act in the best interest of the company, directors of companies referred to in Article 2(1) take into account the consequences of their decisions for sustainability matters, including, where applicable, human rights, climate change and environmental consequences, including in the short, medium and long term.
Amendment 735 #
Proposal for a directive
Article 3 – paragraph 1 – point g a (new)
Article 3 – paragraph 1 – point g a (new)
(ga) product means any item, interconnected or not to other items, throughout its lifecycle, produced, used, supplied or made available, whether for consideration or not, in the course of a commercial activity;
Amendment 738 #
Proposal for a directive
Article 3 – paragraph 1 – point g b (new)
Article 3 – paragraph 1 – point g b (new)
(gb) ‘services’ means services within the meaning of article 57 TFEU;
Amendment 740 #
Proposal for a directive
Article 26 – title
Article 26 – title
Setting up and overseeing due diligence obligations and plans
Amendment 741 #
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 companyn undertaking, or parts of its value chain, with human rights and, good governance, environmental and climate requirements resulting from the provisions of this Directive through an assessment of conformity in accordance with Decision No 768/2008/EC of the European Parliament and of the Council and accredited in accordance with Regulation (EC)No 765/2008, by an auditor which is independent from the companyundertaking, free from any conflicts of interests, has experience, expertise and competence in environmental and, climate, human rights mattersand good governance matters, is accredited in accordance with Regulation (EC) No 765/2008, has a European registered office and is accountable for the quality and reliability of the audit;
Amendment 743 #
Proposal for a directive
Article 26 – paragraph 1
Article 26 – paragraph 1
1. Member States shall ensure that directors of companies referred to in Article 2(1) are responsible for putting in place and overseeing the due diligence actions referred to in Article 4 and in particular the due diligence policy referred to in Article 5 and implementing actions under Article 15, with due consideration for relevant input from stakeholders and civil society organisations. The directors shall regularly report to the board of directors in that respeand discuss progress in mitigating adverse human rights, environmental and climate adverse impacts.
Amendment 746 #
Proposal for a directive
Article 26 – paragraph 2
Article 26 – paragraph 2
2. Member States shall ensure that directors take steps to adapt the corporate strategy and their business model to take into account the actual and potential adverse impacts identified pursuant to Article 6 and any measures taken pursuant to Articles 7 to 9 and Article 15.
Amendment 748 #
Proposal for a directive
Article 3 – paragraph 1 – point j
Article 3 – paragraph 1 – point j
(j) ‘industry initiative’ means a combination of voluntary value chain due diligence procedures, tools and mechanisms, includinghat: - are voluntarily adopted by undertakings, and, when adopted, are binding undertakings and, if applicable, their partners, - assess the conformity with due diligence obligations through accredited independent third- party verifications, - include the perspectives of civil society in audits and the steering of the standards and grievance mechanisms according to the effectiveness criteria of the UNGP, - are developed and overseen by governments, industry associations or groupings of interested organisations; subject to the prior approval of the European Network of Supervisory Authorities;
Amendment 749 #
Proposal for a directive
Article 29 – paragraph 1 – introductory part
Article 29 – paragraph 1 – introductory part
No later than … [OP please insert the date = 75 years after the date of entry into force of this Directive] and every 3 years thereafter, the Commission shall submit a report to the European Parliament and to the Council on the implementation of this Directive. This report shall be accompanied, if appropriate, by a legislative proposals. The report shall evaluate the effectiveness of this Directive in reaching its objectives and assess the following issues:
Amendment 751 #
Proposal for a directive
Article 29 – paragraph 1 – point a
Article 29 – paragraph 1 – point a
(a) whether the thresholds regarding the number of employees and net turnover laid down in Article 2(1) need to be lowered; the impact of this Directive on SMEs, accompanied by an account and assessment of the effectiveness of the different measures and tools for support provided to SMEs by the Commission and Member States;
Amendment 755 #
Proposal for a directive
Article 29 – paragraph 1 – point b
Article 29 – paragraph 1 – point b
(b) whether the list of sectors in Article 2(1),3 point (bca), needs to be chexpangded, including in order to align it to guidance from the Organisation for Economic Cooperation and Development;
Amendment 756 #
Proposal for a directive
Article 29 – paragraph 1 – point b a (new)
Article 29 – paragraph 1 – point b a (new)
(ba) the effectiveness of the enforcement mechanisms put in place at national level and of the sanctions and procedures for civil liability in particular;
Amendment 756 #
Proposal for a directive
Article 3 – paragraph 1 – point l
Article 3 – paragraph 1 – point l
(l) ‘severe adverse impact’ means an adverse environmental impact or an adverse human rightsand climate, human rights or good governance impact that is or could be especially significant by its nature, or affects or could affect a large number of persons or a large area of the environment, or which is or could be irreversible, or is or could be particularly difficult to remedy as a result of the measures necessary to restore the situation prevailing prior to the impact;
Amendment 757 #
Proposal for a directive
Article 29 – paragraph 1 – point b b (new)
Article 29 – paragraph 1 – point b b (new)
(bb) the use and accessibility of complaints procedures and follow-up actions undertaken by companies and public authorities;
Amendment 758 #
Proposal for a directive
Article 29 – paragraph 1 – point b c (new)
Article 29 – paragraph 1 – point b c (new)
(bc) the involvement of stakeholders throughout all due diligence processes;
Amendment 760 #
Proposal for a directive
Article 29 – paragraph 1 – point d
Article 29 – paragraph 1 – point d
Amendment 762 #
Proposal for a directive
Article 3 – paragraph 1 – point n
Article 3 – paragraph 1 – point n
(n) ‘stakeholders’ means the company’s employees, the employees of its subsidiaries, and other individuals, groups, communities or entities whose rights or interests are or could be affected by the products, services and operations of that company, its subsidiaries and its business relationships;: (i) the undertaking’s workers, the workers of its subsidiaries, its small shareholders and other individuals, groups, communities, entities or civil society organisations, whose rights or interests are or could be affected by the products, services and operations or by the potential or actual adverse impacts on human rights, or good governance climate or environment of that undertaking, its subsidiaries and its business relationships across the entire value chain; (ii) organisations and persons representing the individuals, groups, communities or entities included in (i); (iii) organisations who have as a statutory purpose the defence of human rights, good governance, the environment or climate; and (iv) other legal or natural persons engaged in the defence of human rights, good governance, the environment or climate, including those covered by point (na) and (nb) of this paragraph.
Amendment 767 #
Proposal for a directive
Article 30 – paragraph 1 – subparagraph 2
Article 30 – paragraph 1 – subparagraph 2
Amendment 768 #
Proposal for a directive
Article 30 – paragraph 1 – subparagraph 2 – point a
Article 30 – paragraph 1 – subparagraph 2 – point a
Amendment 772 #
Proposal for a directive
Article 30 – paragraph 1 – subparagraph 2 – point b
Article 30 – paragraph 1 – subparagraph 2 – point b
Amendment 772 #
Proposal for a directive
Article 3 – paragraph 1 – point n a (new)
Article 3 – paragraph 1 – point n a (new)
(na) ‘environmental rights defenders’ means individuals and groups who, in their personal or professional capacity and in a peaceful manner, strive to protect and promote human rights relating to the environment and climate, including biodiversity, water, air ,land, soil, flora and fauna;
Amendment 774 #
Proposal for a directive
Article 3 – paragraph 1 – point n b (new)
Article 3 – paragraph 1 – point n b (new)
(nb) 'human rights defenders’ means individuals, groups and organs of society that promote and protect universally recognised human rights and fundamental freedoms; human rights defenders seek the promotion and protection of civil and political rights as well as the promotion, protection and realisation of economic, social and cultural rights; human rights defenders also promote and protect the rights of members of groups such as indigenous communities;
Amendment 775 #
Proposal for a directive
Article 3 – paragraph 1 – point n c (new)
Article 3 – paragraph 1 – point n c (new)
(nc) ‘workers’ representatives’ means representatives of recognised trade unions or other persons who are freely elected or who are designated by the workers in an organisation to represent them in accordance with national law and practice. The exclusive prerogatives and rights of trade unions, such as the right of trade unions to participate in collective bargaining, and to conclude collective agreements, and workers' right to organise themselves in trade unions, shall be preserved;
Amendment 781 #
Proposal for a directive
Annex I – Part I – point 18 – introductory part
Annex I – Part I – point 18 – introductory part
18. Violation of the prohibition of causing any measurable environmental degradationquantitative and qualitative environmental degradation and contributing to climate change, such as harmful soil change, water or air pollution, harmful emissions, including GES emissions, or excessive water consumption or other impact on natural resources, that
Amendment 783 #
Proposal for a directive
Article 3 – paragraph 1 – point q
Article 3 – paragraph 1 – point q
(q) ‘appropriate measures’ means a set of measures that is capable of achieving the objectives of due diligence and effectively addressing the adverse impact, commensurate with the degree of severity and the likelihood of the adverse impact, and reasonably available to the company, taking into account the circumstances of the specific case, including characteristics of the economic sector and of the specific business relationship and the company’s influence thereof, and the need to ensure prioritisation of action;
Amendment 784 #
Proposal for a directive
Annex I – Part I – point 18 – point e
Annex I – Part I – point 18 – point e
(e) affects ecological integrity, such as deforestation and the intrinsic value of ecosystems as well as the interrelations between them,
Amendment 786 #
Proposal for a directive
Annex I – Part I – point 18 – paragraph 1
Annex I – Part I – point 18 – paragraph 1
in accordance with Article 3 of the Universal Declaration of Human Rights, Article 5 of the International Covenant on Civil and Political Rights and Article 12 of the International Covenant on Economic, Social and Cultural Rights and the right to a healthy environment;
Amendment 790 #
Proposal for a directive
Annex I – Part I – indent 23 a (new)
Annex I – Part I – indent 23 a (new)
- The rights to a clean, healthy and sustainable environment (UN GA A/76/L.75)
Amendment 791 #
Proposal for a directive
Annex I – Part II
Annex I – Part II
Amendment 800 #
Proposal for a directive
Article 4 – paragraph 1 – introductory part
Article 4 – paragraph 1 – introductory part
1. Member States shall ensure that companiesundertakings respect human rights, good governance, the environment and climate by obliging them to conduct human rights and, good governance environmental and climate due diligence as laid down in Articles 5 to 11 (‘due diligence’) by carrying out the following actions:
Amendment 813 #
Proposal for a directive
Article 4 – paragraph 1 – point d a (new)
Article 4 – paragraph 1 – point d a (new)
(da) engaging with stakeholders in a meaningful way throughout the whole due diligence process, in accordance with article 9a;
Amendment 828 #
Proposal for a directive
Article 4 a (new)
Article 4 a (new)
Article 4a Heightened due diligence in conflict affected areas Member States shall ensure that undertakings operating in situations of armed conflict or military occupation respect their obligations under international humanitarian law. Member States shall ensure that in conflict- affected and high-risk areas undertakings conduct heightened, conflict-sensitive due diligence on all their operations and business relations through integrating a conflict analysis, based on meaningful and conflict-sensitive stakeholder engagement of the root causes, triggers and parties driving the conflict, and the impact of the undertaking’s business activities on the conflict into their due diligence.
Amendment 832 #
Proposal for a directive
Article 5 – paragraph 1 – introductory part
Article 5 – paragraph 1 – introductory part
1. Member States shall ensure that companieundertakings integrate due diligence into all their corporate policies and have in place a due diligence policy. The due diligence policy supported by sufficient financial and human resources for its implementation. The due diligence policy shall be developed in consultation with all stakeholders and shall contain all of the following:
Amendment 837 #
Proposal for a directive
Article 5 – paragraph 1 – point a
Article 5 – paragraph 1 – point a
(a) a description of the company’s approach, including in the long term, to due diligenundertaking’s approach to due diligence, including in the short, medium and long term and covering all their operations, products and services;
Amendment 843 #
Proposal for a directive
Article 5 – paragraph 1 – point b
Article 5 – paragraph 1 – point b
(b) a code of conduct describing rules and principles to be followed by the company’s employees and subsidiarieundertaking’s workers and subsidiaries across all corporate functions and operations, and by entities with whom the undertaking or any of its subsidiaries have business relationships;
Amendment 846 #
Proposal for a directive
Article 5 – paragraph 1 – point c
Article 5 – paragraph 1 – point c
(c) a description of the processes and concrete measures put in place to implement due diligence across the value chain, including the measures taken to verify compliance with the code of conduct and to extend its application to established business relationshipand policies regarding its own business models and purchasing practices as well as the measures taken to verify compliance with the code of conduct and to extend its application to business relationships. When this description includes reference to independent third-party verification, undertakings shall add to their due diligence policy a comprehensive report of the results of third-party audits of the previous three years;
Amendment 854 #
Proposal for a directive
Article 5 – paragraph 1 – point c a (new)
Article 5 – paragraph 1 – point c a (new)
(ca) a description of the available non- judicial grievance mechanisms provided under article 9;
Amendment 855 #
Proposal for a directive
Article 5 – paragraph 1 a (new)
Article 5 – paragraph 1 a (new)
1a. For undertakings operating in one of the high-impact sectors referred to in Article 3 point (cb), the description of the undertaking’s approach, the code of conducts and description of the processes and measures required under paragraph 1 (a) to (c) shall also include a detailed focus on the risks and impacts that are specific to that sector.
Amendment 858 #
Proposal for a directive
Article 5 – paragraph 2
Article 5 – paragraph 2
2. Member States shall ensure that the companies update their due diligence policy annuallyundertakings review, update and publish their due diligence policy at least every 12 months and whenever needed, in particular when there are reasonable grounds to believe that new risks of the occurrence of adverse impacts have arised or may arise.
Amendment 864 #
Proposal for a directive
Article 5 – paragraph 2 a (new)
Article 5 – paragraph 2 a (new)
2a. The due diligence policy shall be developed in consultation with all stakeholders in line with article 9a. Undertakings shall carry out negotiations, information and consultation with trade unions and workers’ representative including to integrate due diligence into all their corporate policies and have in place a due diligence policy within the meaning of in Directive 2009/38/EC.
Amendment 874 #
Proposal for a directive
Article 6 – title
Article 6 – title
Identifying and assessing actual and potential adverse impacts
Amendment 875 #
Proposal for a directive
Article 6 – paragraph 1
Article 6 – paragraph 1
1. Member States shall ensure that companieundertakings take appropriate measures to identify and assess actual and potential adverse human rights impacts and adverse environmental, good governance, environmental, and climate adverse impacts arising from their own operations, products and services, or those of their subsidiaries and, wher those related to their value chains, from their established business relationships, in accordance with paragraph 2, 3 and 4. The appropriate measures shall also include the assessment of the impact of policies and strategies regarding business relationships, including trading, procurement and pricing practices. Member States shall ensure that in particular for undertakings operating in one of the high-impact sectors referred to in Article 3 point (cb),appropriate measures shall also target the risks that are specific to that sector.
Amendment 894 #
Proposal for a directive
Article 6 – paragraph 2
Article 6 – paragraph 2
Amendment 903 #
Proposal for a directive
Article 6 – paragraph 3
Article 6 – paragraph 3
Amendment 906 #
Proposal for a directive
Article 6 – paragraph 4
Article 6 – paragraph 4
4. Member States shall ensure that, for the purposes of identifying and assessing the adverse impacts referred to in paragraph 1 based on, where appropriate, quantitative and qualitative information, companieincluding disaggregated data, undertakings 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 onUndertakings shall collect and assess sex-disaggregated data and identify gender-specific trends and patterns to understand whether their activities impact differently on men and women. Undertakings shall also carry out consultations with potentially affected groups including workers and other relevant stakeholders including trade unions, civil society organisations as well as human rights and environmental rights defenders to gather information on as well as to identify and assess actual or potential adverse impacts.
Amendment 918 #
Proposal for a directive
Article 6 – paragraph 4 a (new)
Article 6 – paragraph 4 a (new)
4a. Member States shall ensure that in the context of conflict-affected and high- risk areas, undertakings engage in heightened due diligence and augment their due diligence framework with tools from atrocity prevention and conflict prevention.
Amendment 923 #
Proposal for a directive
Article 7 – paragraph 1
Article 7 – paragraph 1
1. Member States shall ensure that companieundertakings take appropriate measures to prevent, or where prevention is not possible or not immediately possible, adequately mitigate potential adverse human rights impacts and adverse environmental, good governance as well as environmental and climate adverse impacts that have been, or should have been, identified pursuant to Article 6, in accordance with paragraphs 2, 3, 4 and 5 of this Article. Member States shall ensure that undertakings operating in a high-impact sector referred in Article 3 (cb) take all the necessary measures to target the specific risks arising from their specific sector.
Amendment 928 #
Proposal for a directive
Article 7 – paragraph 2 – introductory part
Article 7 – paragraph 2 – introductory part
2. CompanieUndertakings shall be required to take appropriate measures, including but not limited to the following actions, where relevant:
Amendment 931 #
Proposal for a directive
Article 7 – paragraph 2 – point a
Article 7 – paragraph 2 – point a
(a) where necessary due to the nature or complexity of the measures required for prevention, develop and implement a prevention action plan, with reasonable and clearly defined timelines for actionppropriate measures and qualitative and quantitative indicators for measuring improvement. The prevention action plan shall be developed in consultation with affectedll stakeholders;
Amendment 943 #
Proposal for a directive
Article 7 – paragraph 2 – point b
Article 7 – paragraph 2 – point b
(b) seekobtain contractual assurances from a business partner with whom it has a directnd other assurances regarding its business relationship that it will ensures of compliance with the companyundertaking’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 value chain (contractual cascading). When such contractual assurances are obtained, paragraph 4 shall apply. With regards to contractual assurances the terms shall be reasonable and non-discriminatory. In case the business relationship is active in one of the sectors referred to in Article 3point (ca), the assurances shall also include details on ensuring compliance with regards to the risks that are specific to that sector. Obtaining contractual assurances shall not exempt an undertaking from its further obligations under this Directive nor shall it as such exempt an undertaking from its liability for adverse impacts;
Amendment 953 #
Proposal for a directive
Article 7 – paragraph 2 – point c a (new)
Article 7 – paragraph 2 – point c a (new)
(ca) adapt business models and strategies, including trading, procurement and pricing practices, in order to prevent potential adverse impacts;
Amendment 957 #
Proposal for a directive
Article 7 – paragraph 2 – point d
Article 7 – paragraph 2 – point d
(d) provide targeted and proportionate support for an SME with which the company has an established business relationshiphe necessary support such as loans or financing for business partners, in particular SMEs, where compliance with the code of conduct or the prevention action plan would jeopardise the viability of the SMEbusiness partner;
Amendment 963 #
Proposal for a directive
Article 7 – paragraph 2 – point e
Article 7 – paragraph 2 – point e
(e) in compliance with Union law including competition law, collaborate with other entities, including, where relevantapplicable, to increase the companyundertakings’s ability to bring the adverse impact to an end, in particular where no other action is suitable or effective;
Amendment 967 #
Proposal for a directive
Article 7 – paragraph 2 a (new)
Article 7 – paragraph 2 a (new)
2a. The appropriate measures and actions shall apply to an undertaking’s own operations, products and services, their subsidiaries as well as direct and indirect business relationships.
Amendment 970 #
Proposal for a directive
Article 7 – paragraph 3
Article 7 – paragraph 3
Amendment 976 #
Proposal for a directive
Article 7 – paragraph 4 – subparagraph 1
Article 7 – paragraph 4 – subparagraph 1
The contractual assurances or the contract shall be accompanied by the appropriate measures to verify compliance. For the purposes of verifying compliance, the company may refer to suitable industry initiatives or independent third-party verification.
Amendment 985 #
Proposal for a directive
Article 7 – paragraph 4 – subparagraph 2
Article 7 – paragraph 4 – subparagraph 2
When contractual assurances are obtained from, or a contract is entered into, with an SME, the terms used shall be fair, reasonable and non-discriminatory. Where measures to verify compliatrack efficiencey are carried out in relation to SMEs, the company shall bear the cost of the independent third- party verificationassociated cost.
Amendment 993 #
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 because mitigation is not possible or acceptable, or there is no reasonable prospect of change, the undertaking shall be required to refrain from entering into new or extending existing relations with the partner in connection with or in the value chain of which the impact has arisen and shall, where the law governing their relations so entitles them to, take the following. In such cases, the undertaking shall, in consultation with stakeholders, identify and remedy the risks and impacts of their actions, and:
Amendment 996 #
Proposal for a directive
Article 7 – paragraph 5 – subparagraph 1 – point a
Article 7 – paragraph 5 – subparagraph 1 – point a
(a) temporarily suspend commercial relations with the partner in question, while pursuing prevention and minimistigation efforts, if there is reasonable expectation that these efforts will succeed in the short- term;
Amendment 998 #
Proposal for a directive
Article 7 – paragraph 5 – subparagraph 1 – point b
Article 7 – paragraph 5 – subparagraph 1 – point b
(b) terminate the business relationship with respect to the activities concerned if the potential adverse impact is severe. , only as a last resort and if the adverse impact is considered severe, systematic or state-sponsored, as well as if the conditions for temporary suspension under point (a) are not met. The undertaking shall engage in a timely, efficient and meaningful manner with stakeholders impacted by the decision to disengage, in particular with the undertaking's workers and their legitimate representatives, before reaching this decision. When negative impacts of termination are assessed to be greater than the impact intended to be prevented or mitigated, the undertaking shall refrain from terminating the business relationship The undertaking shall address the adverse impacts related to the decision to disengage and shall disclose, as part of its reporting obligations under article 11, the number of instances where it decided to disengage, the reason for this disengagement and the location of the concerned business relationships without disclosing their identity.
Amendment 1000 #
Proposal for a directive
Article 7 – paragraph 5 – subparagraph 1 – point b a (new)
Article 7 – paragraph 5 – subparagraph 1 – point b a (new)
(ba) An undertaking’s decision to terminate a contract or business relationship in terms of this article shall be understood to form part of the undertaking’s due diligence measures and therefore assessed as such with regards to its appropriateness.
Amendment 1006 #
Proposal for a directive
Article 7 – paragraph 5 – subparagraph 2
Article 7 – paragraph 5 – subparagraph 2
Member States shall provide for the availability of anthe same option to suspend or terminate the business relationship in contracts governed by their laws.
Amendment 1008 #
Proposal for a directive
Article 7 – paragraph 5 a (new)
Article 7 – paragraph 5 a (new)
5a. For the purposes of this Article, in cases where an undertaking may cause an adverse impact, appropriate measures shall be understood as measures which effectively prevent or mitigate a potential adverse impact. In cases where an undertaking may contribute to an adverse impact, appropriate measures shall be understood as measures which effectively prevent or mitigate the contribution to the impact and those which use or increase the undertaking’s leverage with other responsible parties to prevent or mitigate the potential adverse impact. In cases where an undertaking’s operations, products or services may be directly linked to an adverse impact through its relationships with other entities, appropriate measures shall be understood as measures which seek to prevent or mitigate the potential adverse impact by using or increasing the undertaking’s leverage with responsible parties.
Amendment 1013 #
Proposal for a directive
Article 7 – paragraph 6
Article 7 – paragraph 6
Amendment 1017 #
Proposal for a directive
Article 7 – paragraph 6 a (new)
Article 7 – paragraph 6 a (new)
Amendment 1024 #
Proposal for a directive
Article 8 – paragraph 2
Article 8 – paragraph 2
2. Where the adverse impact cannot immediately be brought to an end, Member States shall ensure that companieundertakings minimise the extent of such an impact, while continuing to pursue all efforts, proportionate to the significance and scale of the adverse impact, to bring the adverse impact to an end.
Amendment 1028 #
Proposal for a directive
Article 8 – paragraph 3 – introductory part
Article 8 – paragraph 3 – introductory part
3. Companies shall be required to takeIn order to comply with paragraphs 1 and 2of this article, undertakings shall be required to take appropriate measures, including but not limited to the following actions, where relevant:
Amendment 1035 #
Proposal for a directive
Article 8 – paragraph 3 – point a
Article 8 – paragraph 3 – point a
(a) neutralise the adverse impact or minimise its extent, including by the payment of damages to the affected persons and of financial compensation to the affected communities. The action shall be proportionate to the significance and scale of the adverse impact and to the contributhrough appropriate measures. In the event that these measures are accompanied by financial compensation paid by undertakings for adverse impacts resulting from business relationships, undertakings shall benefit from legal assurance to obtain compensation ofrom the company’s conduct to the adverse impactpartners concerned;
Amendment 1043 #
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 and measures with reasonable and clearly defined timelines for action, tools and qualitative and quantitative indicators for measuring improvement. WThere relevant, the corrective action plan shall be developed in consultation with stakeholders action shall be proportionate to the significance and scale of the adverse impact and to the contribution of the undertaking’s conduct to the adverse impact. This is without prejudice to the possibility for Member States to uphold or introduce joint and several liability for different undertakings with a shared responsible for an adverse impact. The corrective action plan shall be developed in consultation with stakeholders, including trade unions and workers’ representatives and civil society organisations, and shall be publicly available;
Amendment 1048 #
Proposal for a directive
Article 8 – paragraph 3 – point c
Article 8 – paragraph 3 – point c
(c) seekobtain contractual and other assurances from a direct partner with whom it has an establishedregarding its business relationship that it will ensures of 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 value chain (contractual cascading). When such contractual assurances are obtained, paragraph 5 shall apply. business relationships with respect to the implementation to a corrective action plan. With regards to contractual assurances the terms shall be reasonable and non-discriminatory. In case the business relationship is active in one of the high-impact sectors referred to in article 3 point (cb), the assurances shall also include details on ensuring compliance with regards to the risks that are specific to that sector. Obtaining contractual assurances shall not exempt an undertaking from its further obligations under this Directive nor shall it as such exempt an undertaking from its liability for adverse impacts;
Amendment 1058 #
Proposal for a directive
Article 8 – paragraph 3 – point d a (new)
Article 8 – paragraph 3 – point d a (new)
(da) adapt business models and strategies, including trading, procurement and pricing practices, in order to bring to an end or minimise actual adverse impacts
Amendment 1065 #
Proposal for a directive
Article 8 – paragraph 3 – point e
Article 8 – paragraph 3 – point e
(e) provide targeted and proportionate support for an SME with which the company has an established business relationshiphe necessary support such as loans or financing for business partners, in particular for SMEs, where compliance with the code of conduct or the corrective action plan would jeopardise the viability of the SMEbusiness partner;
Amendment 1070 #
Proposal for a directive
Article 8 – paragraph 3 – point f
Article 8 – paragraph 3 – point f
(f) in compliance with Union law including competition law, collaborate with other entities, including, where relevantapplicable, to increase the companyundertaking’s ability to bring the adverse impact to an end, in particular where no other action is suitable or effective.
Amendment 1072 #
Proposal for a directive
Article 8 – paragraph 3 a (new)
Article 8 – paragraph 3 a (new)
3a. These measures and actions shall apply to an undertaking’s own operations, products and services, subsidiaries as well as direct and indirect business relationships.
Amendment 1074 #
Proposal for a directive
Article 8 – paragraph 4
Article 8 – paragraph 4
Amendment 1078 #
Proposal for a directive
Article 8 – paragraph 5 – subparagraph 1
Article 8 – paragraph 5 – subparagraph 1
The contractual assurances or the contract shall be accompanied by the appropriate measures to verify compliance. For the purposes of verifying compliance, the company may refer to suitable industry initiatives or independent third-party verification.
Amendment 1085 #
Proposal for a directive
Article 8 – paragraph 5 – subparagraph 2
Article 8 – paragraph 5 – subparagraph 2
When contractual assurances are obtained from, or a contract is entered into, with an SME, the terms used shall be fair, reasonable and non-discriminatory. Where measures to verify compliatrack efficiencey are carried out in relation to SMEs, the company shall bear the cost of the independent third- party verificationassociated cost.
Amendment 1090 #
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 companybringing the impact to an end is not possible, or there is no reasonable prospect of change, the undertaking shall refrain from entering into new or extending existing relations with the partner in connection to or in the value chain of which the impact has arisen and shall, where the law governing their relations so entitles them to, take one of the following. Undertakings shall, in consultation with stakeholders, identify and address the risks and impacts of their actions and:
Amendment 1095 #
Proposal for a directive
Article 8 – paragraph 6 – subparagraph 1 – point a
Article 8 – paragraph 6 – subparagraph 1 – point a
(a) temporarily suspend commercial relationships with the partner in question, while pursuing efforts to bring to an end or minimistigate the extent of the adverse impact, or
Amendment 1100 #
Proposal for a directive
Article 8 – paragraph 6 – subparagraph 1 – point b
Article 8 – paragraph 6 – subparagraph 1 – point b
(b) terminate the business relationship with respect to the activities concerned, only as a last resort and if the adverse impact is considered severe, systematic or state-sponsored, as well as if the conditions for temporary suspension under point (a) are not met. The undertaking shall engage in a timely, efficient and meaningful manner with stakeholders impacted by the decision to disengage, in particular with the undertaking's workers and their legitimate representatives, before reaching this decision. When negative impacts of termination are assessed to be greater than the impact intended to be brought to an end or mitigated, the undertaking shall refrain from terminating the business relationship. The undertaking shall address the adverse impacts related to the decision to disengage and shall disclose, as part of its reporting obligations under article 11, the number of instances where it decided to disengage, the reason for this disengagement and the location of the concerned business relationships without disclosing their identity.
Amendment 1101 #
Proposal for a directive
Article 8 – paragraph 6 – subparagraph 1 – point b a (new)
Article 8 – paragraph 6 – subparagraph 1 – point b a (new)
(ba) An undertaking’s decision to terminate a contract or business relationship in terms of this article shall be understood to form part of the undertaking’s due diligence measures and therefore assessed as such with regards to its appropriateness.
Amendment 1112 #
Proposal for a directive
Article 8 – paragraph 6 – subparagraph 2
Article 8 – paragraph 6 – subparagraph 2
Member States shall provide for the availability of anthe same option to suspend terminate the business relationship in contracts governed by their laws.
Amendment 1117 #
Proposal for a directive
Article 8 – paragraph 7
Article 8 – paragraph 7
Amendment 1121 #
Proposal for a directive
Article 8 – paragraph 7 a (new)
Article 8 – paragraph 7 a (new)
7a. In the event that the undertaking is not in a position to neutralise or correct all the actual adverse impacts at the same time, it shall develop, implement and review at least every six months a prioritisation strategy in consultation with all stakeholders. Such prioritisation strategy shall take into account the level of severity, likelihood, the duration, the spread and the reversibility of the different actual adverse impacts on human rights, good governance, the environment and climate. Member States shall ensure that undertakings make their prioritisation strategy and the assessment on which it is based, publicly available.
Amendment 1123 #
Article 8a Union-wide resilience assessments 1. The Commission shall initiate and coordinate on a bi-annual basis Union- wide assessments of the resilience of undertakings to adverse scenarios related to their value chains. To that end, it shall develop: (a) common methodologies for identifying scenarios, including potential disruptions, and for assessing their impact on value chains and thereby on a undertaking’s financial position, also taking into account risks stemming from adverse developments linked to environmental, social and political factors; (b) common methodologies for assessing the sustainability of undertakings value chains; (c) common methodologies for assessing the sustainability impacts of disruptions of undertakings’ value chains; (d) common methodologies for identifying categories of undertakings to be subject to Union-wide assessments; (e) common approaches to communication on the outcomes of those assessments of the resilience of undertakings; (f) common methodologies for identifying preventative and remedial responses to address risks and vulnerabilities identified under points (b) to (d), including value diversification, reshoring and stockpiling. 2. The Commission shall, once a year, and more frequently where necessary, provide a summary of the assessments under paragraph to the European Parliament and the Council, including the main identified risks and vulnerabilities. The Commission shall include classification of the main risks and vulnerabilities in these assessments and recommend preventative or remedial actions. 3. For the purpose of running the Union-wide assessments on the resilience of undertakings the Commission shall rely on information under Articles 19a and 29a under Directive 2013/34/EU and Article11 of this Directive as well as request competent authorities to carry out on-site inspections, and may participate in such on-site inspections in order to ensure comparability and reliability of methods, practices and results. 4. The Commission shall be empowered to adopt, by October 2024, delegated act to specify information required from undertakings for the purpose of paragraphs 1 points (a) to (f).
Amendment 1128 #
Proposal for a directive
Article 9 – title
Article 9 – title
Amendment 1132 #
Proposal for a directive
Article 9 – paragraph 1
Article 9 – paragraph 1
1. Member States shall ensure that companies provide the possibility forundertakings establish, in consultation with stakeholders, or participate in an effective grievance mechanisms at operational level, both as an early- warning risk-awareness and as a remediation system, that can be used by persons and organisations listed in paragraph 2 to submit complaints to themraise grievances and request remedy where they have legitimatreasonable concerns regarding actual or potential adverse human rights impacts and adverse, good governance and environmental and climate impacts with respect to their own operations, the operation products and services, the operations, products and services of their subsidiaries and their value chains.
Amendment 1140 #
Proposal for a directive
Article 9 – paragraph 1 a (new)
Article 9 – paragraph 1 a (new)
1a. Member States shall ensure that grievance mechanisms as established by undertakings, are legitimate, accessible, predictable, safe, equitable, transparent, rights-compatible and adaptable. Such mechanisms shall provide for the possibility to raise concerns either anonymously or confidentially, in accordance with national law.
Amendment 1143 #
Proposal for a directive
Article 9 – paragraph 1 b (new)
Article 9 – paragraph 1 b (new)
1b. Member States shall ensure that undertakings provide information to stakeholders, including in particular actual and potentially affected rights holders, on such grievance mechanisms, including on how to access them, on decisions and remedies relating to an undertaking and on how the undertaking is implementing them. All information shall be published in a manner that does not endanger the stakeholders’ safety, including by not disclosing their identity.
Amendment 1145 #
Proposal for a directive
Article 9 – paragraph 1 c (new)
Article 9 – paragraph 1 c (new)
1c. Member States shall ensure that stakeholders, including in particular actual and potentially affected rights holders, play a central role in the design and evaluation of such independent grievance mechanisms and in the provision of remedy.
Amendment 1148 #
Proposal for a directive
Article 9 – paragraph 1 d (new)
Article 9 – paragraph 1 d (new)
1d. Member States shall ensure that undertakings are enabled to provide a grievance mechanism through collaborative arrangements with other undertakings or organisations, by participating in multi-stakeholder grievance mechanisms or joining a Global Framework Agreement.
Amendment 1149 #
Proposal for a directive
Article 9 – paragraph 1 e (new)
Article 9 – paragraph 1 e (new)
1e. The body or person applying the grievance mechanism shall be entitled to make proposals to the undertakings on how potential or actual adverse impacts may be addressed and on how to improve the grievance mechanism.
Amendment 1151 #
Proposal for a directive
Article 9 – paragraph 1 f (new)
Article 9 – paragraph 1 f (new)
1f. Member States shall ensure that undertakings adopt and implement policies and processes to maintain the independence of the complaints procedure and address the needs of people who may be at heightened risk of vulnerability or marginalisation. Complaints procedure shall be gender and culturally responsive and Member States shall oblige undertakings to remove any barriers that women may face to effective access them.
Amendment 1153 #
Proposal for a directive
Article 9 – paragraph 2 – introductory part
Article 9 – paragraph 2 – introductory part
2. Member States shall ensure that the complaints may be submitted by: grievances may be submitted by all persons, groups, communities, entities and civil society organisations covered by Article 3points (n), (na), (nb) as well as the natural and legal persons representing them, including in particular trade unions and other workers’ representatives.
Amendment 1156 #
Proposal for a directive
Article 9 – paragraph 2 – point a
Article 9 – paragraph 2 – point a
Amendment 1160 #
Proposal for a directive
Article 9 – paragraph 2 – point b
Article 9 – paragraph 2 – point b
Amendment 1167 #
Proposal for a directive
Article 9 – paragraph 2 – point c
Article 9 – paragraph 2 – point c
Amendment 1178 #
Proposal for a directive
Article 9 – paragraph 3
Article 9 – paragraph 3
3. Member States shall ensure that the companies establishgrievance mechanisms include a procedure for dealing with complaintgrievances referred to in paragraph 1, including a procedure when the companyundertaking or its internal grievance mechanism considers the complaintgrievance to be unfounded, and inform the relevant stakeholders, including workers and trade unions, of those procedures. Member States shall ensure that where the complaintgrievance is well-founded, the adverse impact that is the subject matter of the complainit is deemed to be identified within the meaning of Article 6.
Amendment 1185 #
Proposal for a directive
Article 9 – paragraph 4 – introductory part
Article 9 – paragraph 4 – introductory part
4. Member States shall ensure that complainants and their representatives are entitled
Amendment 1187 #
Proposal for a directive
Article 9 – paragraph 4 – point -a (new)
Article 9 – paragraph 4 – point -a (new)
(-a) to receive guarantees of non- retaliation, confidentiality and anonymity for all actual and potentially affected stakeholders
Amendment 1190 #
Proposal for a directive
Article 9 – paragraph 4 – point -a a (new)
Article 9 – paragraph 4 – point -a a (new)
(-aa) to receive timely and effective information on the steps and actions taken in the context of a specific grievance filed to the independent grievance mechanism
Amendment 1198 #
Proposal for a directive
Article 9 – paragraph 4 – point b
Article 9 – paragraph 4 – point b
(b) to meetengage with the company’sundertakings’ representatives at an appropriate level to discuss potential or actual severe adverse impacts that are the subject matter of the complaint.
Amendment 1200 #
Proposal for a directive
Article 9 – paragraph 4 – point b a (new)
Article 9 – paragraph 4 – point b a (new)
(ba) to request that undertakings fully remediate or contribute to the full remediation of actual adverse impacts. The remedy shall be proportionate to the significance and scale of the adverse impact
Amendment 1202 #
(bb) to obtain fully remediation or contribution to the full remediation of actual adverse impacts. The remedy shall be proportionate to the significance and scale of the adverse impact.
Amendment 1205 #
Proposal for a directive
Article 9 – paragraph 4 a (new)
Article 9 – paragraph 4 a (new)
4a. Member States shall ensure that recourse to a grievance mechanism shall not preclude the claimants from having access to the substantiated concerns procedure as described in article 19, to the civil liability as described in article 22, nor to any other judicial mechanisms or other non-judicial grievance mechanism.
Amendment 1207 #
Proposal for a directive
Article 9 – paragraph 4 b (new)
Article 9 – paragraph 4 b (new)
4b. Member States shall ensure that any non-judicial remediation efforts shall be in parallel to encouraging collective bargaining and recognition of trade unions and should by no means undermine the role of legitimate trade unions in addressing labour-related disputes.
Amendment 1209 #
Proposal for a directive
Article 9 a (new)
Article 9 a (new)
Article 9a Stakeholder engagement 1. Member States shall ensure that undertakings effectively and meaningfully engage stakeholders, including human rights and environmental human rights defenders, in fulfilling their obligations pursuant to Articles 4-11. Undertakings shall be required to ensure: (a) stakeholder engagement covers information, consultation and participation and takes places on a structural and regular basis throughout the entire due diligence process; (b) comprehensive and meaningful information is provided to stakeholders in accordance with article 11; (c) effective and appropriate frameworks, measures and tools of engagement are put in place, including but not limited to: (i) setting reasonable and appropriate timelines ; (ii) identifying and addressing potential barriers to participation; (iii) providing adequate protection of stakeholders from the risk of retaliation; (iv) implementing an action plan to proactively seek the engagement of stakeholders in a marginalised or vulnerable situation.(d) ad-hoc and pro- active engagement with stakeholders is initiated in case of significant changes in operations, activities or operating context; and(e) a gender- and culturally responsive approach is ensured at all times. 2. Member States shall ensure that, when stakeholders request to be included in the engagement outlined in paragraph 1, undertakings assess and respond to these requests and that they provide a detailed justification in case the request is denied. 3. The engagement of workers and workers’ representatives shall be without prejudice to Directives 2002/14/EC and 2009/38/EC of the European Parliament and of the Council and Council Directive 2001/86/EC.
Amendment 1213 #
Member States shall ensure that companieundertakings carry out periodic assessments of their own operations and measures, those of their subsidiaries and, where related to the value 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 policyto track the implementation monitor the effectiveness of the actions taken in accordance with this Directive. Such assessments shall be carried out in consultation with all stakeholders, based 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. For undertakings operating in one of the sectors referred to in article 3 point (ca), the assessments shall also provide detail with regards to the risks that are specific to that sector. The due diligence policy, the prevention action plan and the corrective action plan shall be updated in accordance with the outcome of those assessments.
Amendment 1221 #
Proposal for a directive
Article 11 – title
Article 11 – title
Communication and Access to Informationg
Amendment 1226 #
Proposal for a directive
Article 11 – paragraph 1
Article 11 – paragraph 1
Member States shall ensure that companieundertakings that are not subject to reporting requirements under Articles 19a and 29a of Directive 2013/34/EU report on the matters covered by this Directive by publishing on their website an annual statement that meets those requirements in a language customary in the sphere of international business. This reporting should be accessible, comparable and sufficiently detailed to demonstrate the adequacy of an undertaking’s due diligence process as per this Directive. For undertakings, and in particular small undertakings, that do not have a website, Member States shall dedicate a publicly accessible website where the annual statement of the undertakings concerned shall be published. The statement shall be published by 30 April each year, covering the previous calendar year.
Amendment 1240 #
Proposal for a directive
Article 11 – paragraph 2 a (new)
Article 11 – paragraph 2 a (new)
Member States shall ensure that undertakings map their value chain and publicly disclose all relevant information with regards to subsidiaries, branches and business relationships, including names, locations, types of products and services.
Amendment 1242 #
Proposal for a directive
Article 11 – paragraph 2 b (new)
Article 11 – paragraph 2 b (new)
Member States shall ensure that undertakings provide, adequate, comprehensive and meaningful information to stakeholders about actual and potential adverse human rights, good governance, environmental and climate impacts and about the actions taken in accordance with this Directive with regards to particular operations, projects and investments. This information shall be provided in written and in a timely, accessible and gender and culturally responsive manner, taking into account the specifics of stakeholders.
Amendment 1245 #
Proposal for a directive
Article 11 – paragraph 2 c (new)
Article 11 – paragraph 2 c (new)
In cases of significant changes in operations, activities or operating context, Member States shall ensure that undertakings proactively communicate to stakeholders and provide complementary and intermediary information.
Amendment 1246 #
Proposal for a directive
Article 11 – paragraph 2 d (new)
Article 11 – paragraph 2 d (new)
Member States shall ensure that stakeholders have the right to request additional information from an undertaking regarding the actions taken in accordance with this Directive, without an interest having to be stated nor proven. Member States shall ensure that the undertaking provides information within a reasonable time, and at the latest within one month after the request has been submitted. A stakeholder whose request for information is denied shall be given a detailed and written justification within a reasonable time. In the event the undertaking does not provide sufficient justification, ignores the request, refuses to disclose the requested information, whether in part or in full, or answers inadequately to the request, Member States shall ensure that supervisory or judicial authorities are entitled to order the disclosure of the information. This process should be just, equitable, timely and not prohibitively expensive. Decisions, whether from supervisory or judicial authorities, shall be publicly accessible.
Amendment 1248 #
Proposal for a directive
Article 11 – paragraph 2 e (new)
Article 11 – paragraph 2 e (new)
Member States shall ensure that the confidentiality of commercial and industrial information, as established under national legislation, shall not serve as a barrier for access to information that relates to the application of this Directive. Grounds for refusal of disclosure shall be interpreted in a restrictive way, taking into account the public interest served by disclosure and the objectives of this Directive.
Amendment 1255 #
Article 11a European Single Access Point Member States shall ensure that annual statements prepared by undertakings pursuant to Article 11 are submitted to the collection body referred to in Regulation[insert ESAP Regulation] in order to make that information accessible on the European Single Access Point (ESAP) . That information shall comply with all of the following requirements: (a) the information shall be prepared in a data extractable format as defined in Article 2, point (3), of Regulation [insert ESAP Regulation] or, where required under Union law, in a machine-readable format, as defined in Article 2, point(13), of Directive (EU) 2019/1024 of the European Parliament and of the Council; (b) the information shall be accompanied by all the following metadata: (i) all the names of the undertaking to which the information relates; (ii) the legal entity identifier of the undertaking, as specified pursuant to Article 7(4) of Regulation [insert ESAP Regulation]; (iii) the size of the undertaking by category, as specified pursuant to Article 7(4) of Regulation [insert ESAP Regulation]; (iv) the type of information, as classified pursuant to Article7(4) of Regulation [insert ESAP Regulation]; (v) the specific period for which the information is to be made publicly available on ESAP, where relevant.
Amendment 1258 #
Proposal for a directive
Article 12 – paragraph 1
Article 12 – paragraph 1
In order to provide support to companieundertakings 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, in consultation with stakeholders, adopt sector specific guidance, which is also to be fit for SMEs, about voluntary model contract clauses and in particular for the sectors referred to in article 3 point (ca). The use of such model contract clauses shall not negate, shift or diminish the obligations of an undertaking to prevent, mitigate adverse impacts or bring these to an end, nor shall it waive an undertaking’s liability under article 22.
Amendment 1264 #
Proposal for a directive
Article 13 – paragraph 1
Article 13 – paragraph 1
In order to provide support to companieundertakings or to Member State authorities on how companieundertakings should fulfil their due diligence obligations, the Commission, in consultation with Member States and stakeholders, including the European cross-industry and sectoral social partners, the European Union Agency for Fundamental Rights, the European Environment Agency, the European Labour Authority, and where appropriate with international bodies having expertise in due diligence, mayshall issue guidelines, including for specific sectors or specific adverse impactseneral as well as sector-specific and impact-specific guidelines, in particular for the high-impact sectors referred to in article 3 point (cb). These guidelines shall be ready before the entry into force of this Directive and shall be regularly reviewed and updated.
Amendment 1271 #
Proposal for a directive
Article 13 – paragraph 1 a (new)
Article 13 – paragraph 1 a (new)
The issues to be addressed by the guidelines shall include the specific obligations under article 5 to 11 of this Directive as well as: (a) contexts, such as situations of conflict or occupation; (b) responsible purchasing practices; (c) gender-responsive and culturally responsive due diligence; (d) resource and information sharing among undertakings and other legal entities for the purposes of preventing, mitigating and remediating adverse impacts incompliance with competition law; (e) measures that undertakings should take to address the challenges faced by smallholders, including access to a living income; (f) responsible disengagement; (g) heightened, conflict-sensitive due diligence in conflict-affected areas. (h) the development and implementation of prioritisation strategies, in particular for SMEs (i) the frequency of risk analysis, on- the-ground-checks and unannounced visits as well as stakeholder-involvement and quality requirements for the report when third-party verifications are used. (j) measures that entities performing third-party verifications should take to ensure cross-company responsibility for subsidiaries or contractors, the prevention of corruption, the appropriate training for auditing personal, concrete methodological guidance for the audit, financial independence and the establishment of a complaints system.
Amendment 1277 #
Proposal for a directive
Article 14 – paragraph 1
Article 14 – paragraph 1
1. Member States shall, in orderBefore the entry into force of this Directive, Member States shall develop and implement measures and toolboxes to provide information, advice and support to companieundertakings and the partners with whom they have established business relationships in their value chains in their efforts to fulfil the obligations resulting from this Directive,. To this end, Member States shall 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 companiessupporting materials such as dedicated interactive and accessible websites, platforms or portals. Such information, advice and support shall be practical and tailored to the specific needs of SMEs in particular, and shall be accompanied by the appointment or establishment of an SME contact point.
Amendment 1286 #
Proposal for a directive
Article 14 – paragraph 3
Article 14 – paragraph 3
3. The Commission mayshall establish due diligence advisors under the scope of the Enterprise Europe Network and shall, including in view of ensuring consistency, complement Member States’ support measures building on existing Union action to support due diligence in the Union and in third countries and may devise new measures, including facilitation of joint stakeholder initiatives to help companieundertakings fulfil their obligations.
Amendment 1289 #
Proposal for a directive
Article 14 – paragraph 3 a (new)
Article 14 – paragraph 3 a (new)
3a. Member States shall provide financial and other support for stakeholders, including for their capacity development. Member States shall also provide relevant and accessible information and instruments to support stakeholders‘ participation in due diligence and judicial processes, in accordance with article 9a.
Amendment 1292 #
Proposal for a directive
Article 14 – paragraph 3 b (new)
Article 14 – paragraph 3 b (new)
3b. The Commission shall develop and implement measures to support safe participatory collection of independent data on human rights violations, good governance and environmental and climate damages and to undertake necessary actions for the data to be considered.
Amendment 1294 #
Proposal for a directive
Article 14 – paragraph 3 c (new)
Article 14 – paragraph 3 c (new)
3c. The Commission shall review the EU‘s cooperation and trade instruments to ensure that they support the development of an enabling environment in third countries, with particular consideration as well as capacity building given to developing countries.
Amendment 1295 #
Proposal for a directive
Article 14 – paragraph 3 d (new)
Article 14 – paragraph 3 d (new)
3d. The Commission shall develop and further strengthen partnership mechanisms with third countries to address the root causes of human rights violations and environmental harms and build the capacity of upstream economic actors to respond to the requirements under this directive.
Amendment 1296 #
Proposal for a directive
Article 14 – paragraph 3 e (new)
Article 14 – paragraph 3 e (new)
3e. The Commission shall develop guidelines for EU export credit agencies and set up an oversight mechanism to ensure that EU and Member States’ funds and export credits operate in line with the principles of this Directive.
Amendment 1297 #
Proposal for a directive
Article 14 – paragraph 4
Article 14 – paragraph 4
4. Companies may rely onUndertakings may use industry schemes and multi-stakeholder initiatives to support the implementation of their obligations referred to in Articles 5 to 11 of this Directive to the extent that such schemes and initiatives are appropriate to support the fulfilment of those obligations. The fitness of such schemes and initiatives to support the fulfilment of those obligations shall be assessed by the Member States through accreditation in accordance with Regulation (EC) 768/2008.The Commission and the Member States may/shall facilitate the dissemination of information on such schemes or initiatives and their outcome. The Commission, in collaboration with Member States, may issue guidance for assessing the fitness of industry schemes and multi-stakeholder initiatives. s empowered to adopt a delegated act on industry schemes and multi-stakeholder initiatives that undertakings may use. The criteria for assessing the fitness of an industry scheme shall include the perspectives of civil society in audits and the steering of the standards and complaint mechanisms according to the effectiveness criteria of the UNGPs. Reliance on industry schemes and multi-stakeholder initiatives shall not absolve the undertaking of its individual responsibility and obligations to perform due diligence and prevent it from being held liable under article 22 of this Directive.
Amendment 1314 #
Proposal for a directive
Article 15 – title
Article 15 – title
Combating climate changelimate targets and transition plans
Amendment 1317 #
Proposal for a directive
Article 15 – paragraph 1
Article 15 – paragraph 1
1. Member States shall ensure that companieundertakings referred to in Article 2(1), point (a), and Article 2(2), point (a), shall adopshallinconsultation with stakeholders, adopt, develop and implement a plan to ensure that the business model and strategy of the company are compatibleundertaking are aligned with the transition to a sustainable economy and with the limiting of global warming to 1.5 °C in line with the Paris Agreement. This plan shall, in particular, identify, on the basis of information reasonably available to the company, the extent to which climate change is a risk for, or an impact of, the company’s operations and with the objective of achieving climate neutrality by 2050 at the latest, as established in Regulation EU 2021/1119 (European Climate Law), pursuant to the latest recommendations of the IPCC and the European Scientific Advisory Board on climate change.
Amendment 1322 #
Proposal for a directive
Article 15 – paragraph 1 a (new)
Article 15 – paragraph 1 a (new)
Amendment 1331 #
Proposal for a directive
Article 15 – paragraph 2
Article 15 – paragraph 2
2. Member States shall ensure that, in case climate change is or should have been identified as a principal risk for, or a principal undertakings referred to in Article 2 shall develop a clear, transparent, accurate, total, comparable and consistent plan, following the best practices. This plan shall in particular take into account, and seek to prevent and mitigate, adverse impacts of, the company’s operations, the company includes emission reduction objec implementing actions on potentially affected groups including workers, local communitives in its planand other stakeholders.
Amendment 1336 #
Proposal for a directive
Article 15 – paragraph 3
Article 15 – paragraph 3
3. Member States shall ensure that companies duly take into account the fulfilment of the obligations referred to in paragraphs 1 and 2 when setting variable remuneration, if variable remuneration is linked to the contribution of a director to the company’s business strategy and long- term interests and sustainabilitundertakings Article 2 shall integrate these targets and implementing actions into the business strategy and backed up by clear governance processes, including the involvement of stakeholders. Member States shall ensure that boards have an obligation to ensure that environmental and climate risks and impacts are addressed in the undertaking’s strategy.
Amendment 1337 #
Proposal for a directive
Article 15 – paragraph 3 a (new)
Article 15 – paragraph 3 a (new)
3a. In line with article 26 (2a), Member States shall ensure that undertakings align a significant part of director’s variable remuneration with the achievement of their climate targets and plans, in particular absolute greenhouse gas emission reduction targets for scope 1, 2and 3. Directors shall be liable for achieving climate objectives and thus for overseeing the obligations set out in paragraphs 1 and 1a of this Article.
Amendment 1339 #
Proposal for a directive
Article 16 – paragraph 2
Article 16 – paragraph 2
2. Member States shall ensure that the name, address, electronic mail address and telephone number of the authorised representative is notified to a supervisory authority in the Member State where the authorised representative is domiciled or established. Member States shall ensure that the authorised representative is obliged to provide, upon request, a copy of the designation in an official language of a Member State to any of the supervisory authorities. Member States shall publish an up to date list of authorised representatives under their jurisdiction on a website.
Amendment 1347 #
Proposal for a directive
Article 17 – paragraph 6
Article 17 – paragraph 6
6. By the date indicated in Article 30(1), point (a), Member States shall inform the Commission of the names and contact details of the supervisory authorities and, when applicable, the respective competences of those authorities, designated pursuant to this Article, as well as of their respective competence where there are several designated supervisory authorities. They shall inform the Commission of any changes thereto.
Amendment 1350 #
Proposal for a directive
Article 17 – paragraph 7 a (new)
Article 17 – paragraph 7 a (new)
7a. Member States shall ensure that supervisory authorities have the appropriate qualification, experience and skills in relation to human rights, good governance, environment and climate to perform their duties and exercise its powers.
Amendment 1353 #
Proposal for a directive
Article 17 – paragraph 8 a (new)
Article 17 – paragraph 8 a (new)
8a. Member States shall ensure that supervisory authorities publish and make available on a website an annual report detailing their past activities, future work plan and priorities. This includes reporting on closed investigations and their results, potential sanctions or other decisions on investigations.
Amendment 1357 #
Proposal for a directive
Article 18 – paragraph 1
Article 18 – paragraph 1
1. Member States shall ensure that the supervisory authorities have adequate powers and resources to carry out the tasks assigned to them under this Directive, including the power to request information and carry out investigaire undertakings to provide all necessary information and carry out investigations, which can include where appropriate on- site inspections related to compliance with the obligations set out in this Directive. Inspections shall also include the hearing of stakeholders.
Amendment 1367 #
Proposal for a directive
Article 18 – paragraph 3
Article 18 – paragraph 3
3. Inspections shall be conducted in compliance with the national law of the Member State in which the inspection is carried out and with prior warning to the companywithout prior warning, except where prior notification hindersis necessary in order to ensure the effectiveness of the inspectionchecks. Where, as part of its investigation, a supervisory authority wishes to carry out an inspection on the territory of a Member State other than its own, it shall seek assistance from the supervisory authority in that Member State pursuant to Article 21(2).
Amendment 1372 #
Proposal for a directive
Article 18 – paragraph 4 – subparagraph 1
Article 18 – paragraph 4 – subparagraph 1
If, as a result of the actions taken pursuant to paragraphs 1 and 2, a supervisory authority identifies a failure to comply with national provisions adopted pursuant to this Directive, it shall grant the companyundertaking concerned an appropriate period of time to take remedial action, if such action is possible.
Amendment 1384 #
Proposal for a directive
Article 18 – paragraph 5 – point c
Article 18 – paragraph 5 – point c
(c) to adopt interim measures to avoid the risk of severe andor irreparable harm.
Amendment 1386 #
Proposal for a directive
Article 18 – paragraph 5 – point c a (new)
Article 18 – paragraph 5 – point c a (new)
(ca) to assess the validity of prioritisation strategies under article 7 and 8 and order a review or impose sanctions if the requirements for such strategies have not been met.
Amendment 1396 #
Proposal for a directive
Article 18 – paragraph 7 a (new)
Article 18 – paragraph 7 a (new)
7a. Member States shall ensure that any decisions of supervisory authorities regarding an undertaking’s compliance with the Directive shall be without prejudice to the undertaking’s civil liability under Article 22.
Amendment 1398 #
Proposal for a directive
Article 18 – paragraph 7 b (new)
Article 18 – paragraph 7 b (new)
7b. Supervisory Authorities shall publish and regularly update a list of all undertakings subject to this Directive and maintain a publicly available and regularly updated record of undertakings that have not published a statement in accordance with Article 11.
Amendment 1403 #
Proposal for a directive
Article 19 – paragraph 1 a (new)
Article 19 – paragraph 1 a (new)
1a. Member States shall ensure that, where the natural and legal persons submitting substantiated concerns so requests, the supervisory authority shall take the necessary measures for the appropriate protection of the identity of that person and for the appropriate protection of any other information in respect of which that person considers that the disclosure of such information would be harmful.
Amendment 1405 #
Proposal for a directive
Article 19 – paragraph 1 b (new)
Article 19 – paragraph 1 b (new)
1b. Member States shall ensure that the supervisory authority informs the person referred to in paragraph 1 on how it intends to follow up on the submission of the substantiated concern. Such information shall be provided within a reasonable period of time after its submission. Where a supervisory authority considers that there are insufficient grounds for acting on a substantiated concern, it shall inform the person of make available to the person all information regarding the measures taken, documentation or other evidence put forward by the undertaking to the supervisory authority in response of the initial substantiated concern. Supervisory authorities shall also ensure that the person which had submitted the initial concern can provide additional information in response to the undertaking's evidence.
Amendment 1406 #
Proposal for a directive
Article 19 – paragraph 1 c (new)
Article 19 – paragraph 1 c (new)
1c. Member States shall ensure that, where a supervisory authority considers that there are sufficient grounds for acting on a substantiated concern, it shall initiate, conduct and conclude an investigation of the concern within a reasonable period of time.
Amendment 1408 #
Proposal for a directive
Article 19 – paragraph 2
Article 19 – paragraph 2
2. Where the substantiated concern falls under the competence of another supervisory authority, the authority receiving the concern shall transmit it to that authority and inform the person referred to in paragraph 1.
Amendment 1409 #
Proposal for a directive
Article 19 – paragraph 3
Article 19 – paragraph 3
3. Member States shall ensure that supervisory authoritiese independence and impartiality of supervisory authorities and that they thoroughly assess the substantiated concerns and, where appropriate, exercise their powers as referred to in Article 18.
Amendment 1410 #
Proposal for a directive
Article 19 – paragraph 4
Article 19 – paragraph 4
4. The supervisory authority shall, as soon as possible and in accordance with the relevant provisions of national law and in compliance with Union law, inform the person referred to in paragraph 1 of the result of the assessment of their substantiated concern and shall provide the reasoning for itof its decisions to accede to or refuse the request for action, and shall provide the reasoning for it and the results of any investigative steps subsequently taken.
Amendment 1414 #
Proposal for a directive
Article 19 – paragraph 5 a (new)
Article 19 – paragraph 5 a (new)
5a. Any such procedure shall be accessible, timely and not prohibitively expensive as well as provide adequate and effective remedies. Member States shall ensure that practical information is made available to the public on access to administrative and judicial review procedures.
Amendment 1416 #
Proposal for a directive
Article 19 – paragraph 5 b (new)
Article 19 – paragraph 5 b (new)
5b. Member States shall ensure that Supervisory Authorities establish easily accessible channels for receiving substantiated concerns. Such systems should be made available in relevant languages and at no cost.
Amendment 1429 #
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 company: (a) the undertaking’s efforts to comply with any remedial action required of them by a supervisory authority, ; (b) any investments made and any targeted support provided pursuant to Articles 7 and 8, as well as; (c) any collaboration with other entities to address adverse impacts in its value chains, as the case may be. ; (d) the severity and duration of the undertaking’s infringement, or the severity of the impacts that have occurred; (e) any previous infringements by the undertaking company and its subsidiaries; (f) the financial benefits gained or losses avoided by the undertaking or its subsidiaries due to the infringement, if the relevant data are available; (g) penalties imposed in respect of the same infringement in other Member States; (h) the degree to which the undertaking has dealt with complaints or proposals raised by stakeholders, including through grievance mechanisms under Article 9; (i) whether or not the undertaking is active in one of the sectors referred to in article 3 point (cb); (j) any other aggravating or mitigating factors applicable to the circumstances of the case.
Amendment 1440 #
Proposal for a directive
Article 20 – paragraph 2 a (new)
Article 20 – paragraph 2 a (new)
2a. Sanctions shall include at least be pecuniary sanctions, and may further include but shall not be limited to, specific performance, the seizure of commodities, as well as the temporary or indefinite exclusion from on-going or future procurement procedures or from the receipt of State aid, export credits, trade missions and advisory bodies to governments. public support schemes including schemes relying on export credit agencies and loans, and permits under export control schemes. Member States shall keep a public record of sanctions that have been imposed.
Amendment 1443 #
Proposal for a directive
Article 20 – paragraph 3
Article 20 – paragraph 3
Amendment 1449 #
Proposal for a directive
Article 20 – paragraph 4
Article 20 – paragraph 4
4. Member States shall ensure that any decision of the supervisory authorities containing sanctions related to the breach of the provisions of this directive is published and made publicly available no later than one month after the decision on the sanction is taken. This should include the methodology and criteria adopted for applying sanctions.
Amendment 1457 #
Proposal for a directive
Article 21 – paragraph 1 – subparagraph 1
Article 21 – paragraph 1 – subparagraph 1
The Commission shall set up a European Network of Supervisory Authorities, composed of representatives of the supervisory authorities. The Network shall facilitate the cooperation of the supervisory authorities and the coordination and alignment of regulatory, investigative, sanctioning and supervisory practices of the supervisory authorities and, as appropriate, sharing of information among them, as well as ensuring the regular public disclosure of the activities of the Network.
Amendment 1479 #
Proposal for a directive
Article 22 – paragraph 1 – point a
Article 22 – paragraph 1 – point a
(a) they failed to comply with the obligations laid down in Articles 7 and 8this directive and;
Amendment 1486 #
Proposal for a directive
Article 22 – paragraph 1 – point b
Article 22 – paragraph 1 – point b
(b) as a result of this failure an adverse impact that should have been identified, prevented, mitigated, brought to an end or its extent minimised through the appropriate measures laid down in Articles 7 and 8this directive occurred and led to damage.
Amendment 1490 #
Proposal for a directive
Article 22 – paragraph 1 a (new)
Article 22 – paragraph 1 a (new)
1a. Member States shall ensure that undertakings are liable for damages that result from adverse human rights, good governance and environmental and climate impacts arising as a result of the activities of a subsidiary and, that should have been identified, prevented, mitigated, brought to an end or their extent minimised by their subsidiaries under this Directive.
Amendment 1493 #
Proposal for a directive
Article 22 – paragraph 1 b (new)
Article 22 – paragraph 1 b (new)
1b. Member States shall ensure that entities performing audits for third-party verifications are liable if: (a) faulty audits contributed to a failure of an undertaking to comply with the obligations laid down in Articles 5 to 11 and; (b) as a result of this failure an adverse impact that should have been identified, prevented, mitigated, brought to an end or its extent minimised through the appropriate measures laid down in Articles 5 to 11 occurred and led to damage.
Amendment 1499 #
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), itan undertaking shall not be liable for damages caused bythat result from an adverse impact arising as a result of the activities of an indirect partner with whom it has an established business relationship, unless it was unreasonable, in they circumstances of the case, to expect that the action actually taken, including an prove they took appropriate meas uregards verifying compliance, would be adequate tos capable of preventing, mitigate, bring or bringing to an end or minimiseing the extent of the adverse impact.
Amendment 1510 #
Proposal for a directive
Article 22 – paragraph 2 a (new)
Article 22 – paragraph 2 a (new)
2a. Where there is a civil liability claim for damages in accordance with Article 22 paragraph 1 and 2, and the claimant provides prima facie elements substantiating the likelihood of the respondent's liability under the Directive, Member States shall take such measures as are necessary to ensure that the causal link between the damage and the undertaking's failure to comply is presumed, and that it shall be for the respondent to prove it has complied with its obligations as laid down in the Directive and that the measures it took were appropriate. Where claimants have provided reasonably available evidence sufficient to support their action in accordance to paragraph 1, Member States shall ensure that courts are enabled to order the defendant and third parties to disclose any evidence in their control, including evidence related to the nature of business relationships or the structure of the undertaking, if requested by the claimant and in accordance with national procedural law, subject to the applicable Union and national rules on confidentiality and proportionality.
Amendment 1527 #
Proposal for a directive
Article 22 – paragraph 4
Article 22 – paragraph 4
4. The civil liability rules under this Directive shall 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 Directiveneither exclude nor limit undertakings' liability under Union or national rules regarding civil liability.
Amendment 1537 #
Proposal for a directive
Article 22 – paragraph 5
Article 22 – paragraph 5
5. Member States shall ensure that the liability provided for in provisions of national law transposing this Article is of overriding mandatory application in cases where the law applicable to claims to that effect is not the law of a Member StateDirective shall apply irrespective of the law otherwise applicable to undertakings, to contractual obligations and to non- contractual obligations.
Amendment 1538 #
Proposal for a directive
Article 22 – paragraph 5 a (new)
Article 22 – paragraph 5 a (new)
5a. Member States shall lay down rules applicable to limitation periods for bringing actions for damages. Limitation periods shall not begin to run before the harm arising out of a failure to comply with this Directive has ceased and the claimant knows, or can reasonably be expected to know of: (a) the behaviour or adverse impacts and the fact that it constitutes a breach of this Directive; (b) the fact that the breach of this Directive caused harm to it; and (c) the identity of the undertaking. Member States shall ensure that the limitation periods for bringing actions for damages are at least ten years. Member States shall ensure that a limitation period is suspended or, depending on national law, interrupted, if a supervisory authority takes action according to Article 18 of this Directive. The suspension shall end at the earliest one year after the decision of the supervisory authority.
Amendment 1540 #
Proposal for a directive
Article 22 – paragraph 5 b (new)
Article 22 – paragraph 5 b (new)
5b. Member States shall ensure that right holders, groups of rights holders or any legal or natural person with a legitimate interest are entitled to seek injunctive measures before Union courts, including through summary proceedings. These shall be available in the form of a provisional or a definitive measure to cease a practice where that practice may constitute a breach of this directive, or the form of a provisional or a definitive measure to take action to comply with this directive.
Amendment 1542 #
Proposal for a directive
Article 22 – paragraph 5 c (new)
Article 22 – paragraph 5 c (new)
5c. Member States shall take measures to ensure the right to an effective remedy and to ensure that the costs and the length of the proceedings under national law do not prevent claimants from access to courts. These measures may include, among others, public funding, including structural support for victims of actual and potential adverse impacts, limitation of applicable court or administrative fees, or access to legal aid.
Amendment 1543 #
Proposal for a directive
Article 22 – paragraph 5 d (new)
Article 22 – paragraph 5 d (new)
5d. Member States shall ensure that trade unions and civil society organisations or other relevant actors acting in the public interest can bring representative actions before court on behalf and for the protection of the collective interests of victims of actual and potential adverse impacts, and that these entities have the rights and obligations of a claimant party in the proceedings.
Amendment 1544 #
Proposal for a directive
Article 22 – paragraph 5 e (new)
Article 22 – paragraph 5 e (new)
5e. Member States shall ensure that the law applicable to non-contractual obligations arising from paragraphs 1 and 2 of this Article shall be the law determined by virtue of the Rome 2 Regulation, unless the plaintiff chooses to base their claim on the law of the country in which the event fiving rise to the damage occurred. Article17 of the Rome 2 Regulation cannot be invoked by the defendant to exonerate or limit their liability.
Amendment 1545 #
Proposal for a directive
Article 22 – paragraph 5 f (new)
Article 22 – paragraph 5 f (new)
5f. Member States shall ensure that victims of actual and potential adverse impacts and any stakeholder with a legitimate interest are entitled to seek injunctive measures before Union courts. These shall be available in the form of a provisional or a definitive measure to cease a practice that may constitute a breach of this Directive, or in the form of a provisional or a definitive measure to take effective actions to comply with this Directive.
Amendment 1546 #
Proposal for a directive
Article 23 – title
Article 23 – title
Amendment 1547 #
Proposal for a directive
Article 23 – paragraph 1
Article 23 – paragraph 1
Amendment 1548 #
Proposal for a directive
Article 23 – paragraph 1 a (new)
Article 23 – paragraph 1 a (new)
Member States shall take the necessary measures to ensure that all stakeholder engagement procedures, and in particular those set in place to raise complaints or concerns, shall allow the confidentiality of those concerns, as well as the anonymity and safety and physical and legal integrity of all stakeholders and complainants, including human rights and environmental defenders. In the event that such procedures concern whistleblowers, those procedures should be in line with Directive (EU) 2019/1937 of the European Parliament and of the Council.
Amendment 1549 #
Proposal for a directive
Article 23 – paragraph 1 b (new)
Article 23 – paragraph 1 b (new)
Member States shall take the necessary measures to ensure that stakeholders and other reporting persons are protected against Strategic Lawsuit against public participation.
Amendment 1556 #
Proposal for a directive
Article 24 – paragraph 1 a (new)
Article 24 – paragraph 1 a (new)
In accordance with Article 18(2) of Directive 2014/24/EU, Article 36(2) of Directive 2014/25/EU and Article 30(3) of Directive 2014/23/EU, Member States shall take the necessary measures to ensure that throughout all stages of applying for public procurement or concessions as well as in the performance of public procurement or concession contracts undertakings comply with the obligations laid down in national provisions adopted pursuant to this Directive. Necessary measures shall include but shall not be limited to the requirement for undertakings to prove compliance with the obligations laid down under this Directive by submitting evidence and supporting documents.
Amendment 1575 #
Proposal for a directive
Article 26 – paragraph 1
Article 26 – paragraph 1
1. Member States shall ensure that directors of companieundertakings referred to in Article 2(1) are responsible for putting in place and overseeing the due diligence actions referred to in Article 4 and in particular the due diligence policy referred to in Article 5 and implementing actions under Article 15, with due consideration for relevant input from stakeholders and civil society organisations. The directors shall regularly report to the board of directors in that respeand discuss progress in mitigating adverse human rights, good governance, environmental and climate adverse impacts.
Amendment 1578 #
Proposal for a directive
Article 26 – paragraph 2
Article 26 – paragraph 2
2. Member States shall ensure that directors take steps to adapt the corporate strategy and their business models to take into account the actual and potential adverse impacts identified pursuant to Article 6 and any measures taken pursuant to Articles 7 to 9 and 15.
Amendment 1581 #
Proposal for a directive
Article 26 – paragraph 2 a (new)
Article 26 – paragraph 2 a (new)
2a. Member States shall ensure that undertakings take into account the directors’ obligations referred to in paragraphs 1 and 2 when setting variable remuneration and that at least half of director’s variable remuneration is aligned with the achievement of sustainability and due diligence targets regarding human rights, good governance, environment and climate.
Amendment 1583 #
Proposal for a directive
Article 28 – paragraph 2
Article 28 – paragraph 2
2. The power to adopt delegated acts referred to in Article 11s8a, 11 and 14 shall be conferred on the Commission for an indeterminate period of 5 years from … ( insert date of entry into force of the directive). The Commission shall draw up a report in respect of the delegation of power not later than nine months before the end of the 5-year period. The delegation of power shall be tacitly extended for periods of timean identical duration, unless the European Parliament or the Council opposes such extension not later than three months before the end of each period.
Amendment 1591 #
Proposal for a directive
Article 29 – title
Article 29 – title
Review and report
Amendment 1593 #
Proposal for a directive
Article 29 – paragraph 1 – introductory part
Article 29 – paragraph 1 – introductory part
No later than … [OP please insert the date = 75 years after the date of entry into force of this Directive] and every 3 years thereafter, the Commission shall submit a report to the European Parliament and to the Council on the implementation of this Directive. This report shall be accompanied, if appropriate, by legislative proposals. The report shall evaluate the effectiveness of this Directive in reaching its objectives and assess the following issues:
Amendment 1597 #
Proposal for a directive
Article 29 – paragraph 1 – point a
Article 29 – paragraph 1 – point a
(a) whether the thresholds regarding the number of employees and net turnover laid down in Article 2(1) need to be loweredthe impact of this Directive on SMEs, accompanied by an account and assessment of the effectiveness of the different measures and tools for support provided to SMEs by the Commission and Member States;
Amendment 1602 #
Proposal for a directive
Article 29 – paragraph 1 – point b
Article 29 – paragraph 1 – point b
(b) whether the list of sectors in Article 2(1)3, point (cb), needs to be chexpangded, including in order to align it to guidance from the Organisation for Economic Cooperation and Development;
Amendment 1603 #
Proposal for a directive
Article 29 – paragraph 1 – point b a (new)
Article 29 – paragraph 1 – point b a (new)
(ba) the effectiveness of the enforcement mechanisms put in place at national level and of the sanctions and procedures for civil liability in particular;
Amendment 1604 #
Proposal for a directive
Article 29 – paragraph 1 – point b b (new)
Article 29 – paragraph 1 – point b b (new)
(bb) the use and accessibility of complaints procedures and follow-up actions undertaken by undertakings and public authorities;
Amendment 1605 #
Proposal for a directive
Article 29 – paragraph 1 – point b c (new)
Article 29 – paragraph 1 – point b c (new)
(bc) the involvement of stakeholders throughout all due diligence processes;
Amendment 1606 #
Proposal for a directive
Article 29 – paragraph 1 – point b d (new)
Article 29 – paragraph 1 – point b d (new)
(bd) the convergence and divergence between Member States in national legislation following the implementation of this Directive;
Amendment 1611 #
Proposal for a directive
Article 29 – paragraph 1 – point d
Article 29 – paragraph 1 – point d
(d) whether Articles 4 to 14 should be extended to adverse climatditional adverse impacts.
Amendment 1624 #
Proposal for a directive
Article 30 – paragraph 1 – subparagraph 2 – introductory part
Article 30 – paragraph 1 – subparagraph 2 – introductory part
They shall apply those provisions as follows:from… [OJ to insert: 2 years from the entry into force of this Directive].
Amendment 1627 #
Proposal for a directive
Article 30 – paragraph 1 – subparagraph 2 – point a
Article 30 – paragraph 1 – subparagraph 2 – point a
Amendment 1631 #
Proposal for a directive
Article 30 – paragraph 1 – subparagraph 2 – point b
Article 30 – paragraph 1 – subparagraph 2 – point b
Amendment 1637 #
Proposal for a directive
Annex I – Part I – subheading 1 - point 2 a (new)
Annex I – Part I – subheading 1 - point 2 a (new)
2a. Violation of the right to self- determination in accordance with common Article 1 of the International Covenant on Civil and Political Rights and of the International Covenant on Economic, Social and Cultural Rights;
Amendment 1639 #
Proposal for a directive
Annex I – Part I – subheading 1 - point 7
Annex I – Part I – subheading 1 - point 7
7. Violation of the right to enjoy just and favourable conditions of work including a fair wage, a decent living, safe and healthy working conditions and reasonable limitation of working hours in accordance with Article 7 of the International Covenant on Economic, Social and Cultural Rights and Article 23.3of the Universal Declaration of Human Rights;
Amendment 1640 #
Proposal for a directive
Annex I – Part I – subheading 1 - point 7 a (new)
Annex I – Part I – subheading 1 - point 7 a (new)
7a. Violation of the right to an adequate standard of living for oneself and her/his family, including adequate food, clothing and housing, and to the continuous improvement of living conditions in accordance with Article 11.1 of the International Covenant on Economic, Social and Cultural Rights and Article 25.1of the Universal Declaration of Human Rights ;
Amendment 1642 #
Proposal for a directive
Annex I – Part I – subheading 1 - point 17 a (new)
Annex I – Part I – subheading 1 - point 17 a (new)
17a. Violation of the prohibition to obstruct the ability of persons to earn a living income in accordance with Article 11 of the International Covenant on Economic, Social and Cultural Rights and Article 25of the Universal Declaration of Human Rights.
Amendment 1643 #
Proposal for a directive
Annex I – Part I – subheading 1 - point 18 – introductory part
Annex I – Part I – subheading 1 - point 18 – introductory part
18. Violation of the prohibition of causing any measurable environmental degradationquantitative and qualitative environmental degradation and contributing to climate change, such as harmful soil change, water or air pollution, harmful emissions, including GHG emissions, or excessive water consumption or other impact on natural resources, that
Amendment 1645 #
(e) affects ecological integrity, such as deforestationand the intrinsic value of ecosystems as well as the interrelations between them,
Amendment 1646 #
Proposal for a directive
Annex I – Part I – subheading 1 - point 18 – paragraph 1
Annex I – Part I – subheading 1 - point 18 – paragraph 1
in accordance with Article 3 of the Universal Declaration of Human Rights, Article 5 of the International Covenant on Civil and Political Rights and Article 12 of the International Covenant on Economic, Social and Cultural Rights and the right to a clean, healthy and sustainable environment;
Amendment 1650 #
Proposal for a directive
Annex I – Part I – subheading 1 - point 20 a (new)
Annex I – Part I – subheading 1 - point 20 a (new)
20a. Violation of the indigenous peoples’ right to give, modify, withhold or withdraw their free, prior, and informed consent to interventions, decisions and activities that may affect their lands, territories, resources and rights, in accordance with Article 10, 11(2), 19, 28, 29(2), 32(2) of the United Nations Declaration on the Rights of Indigenous Peoples and Article 6 and 16 (2) of ILO Convention 169on Indigenous and Tribal Peoples ;
Amendment 1653 #
Proposal for a directive
Annex I – Part I – subheading 1 - point 21
Annex I – Part I – subheading 1 - point 21
21. Violation of a prohibition or right not covered by points 1 to 20a above but included in the human rights agreements listed in Section 2 of this Part, which directly impairs a legal interest protected in those agreements, provided that the companyundertaking concerned could have reasonably established the risk of such impairment and any appropriate measures to be taken in order to comply with the obligations referred to in Article 4 of this Directive taking into account all relevant circumstances of their operations, such as the sector and operational context.
Amendment 1654 #
Proposal for a directive
Annex I – Part I – subheading 1 - point 21 a (new)
Annex I – Part I – subheading 1 - point 21 a (new)
21a. In conflict affected areas, violations of international humanitarian law as laid out notably in the Geneva Conventions and the additional protocols.
Amendment 1656 #
Proposal for a directive
Annex I – Part I – subheading 2 - indent 3 a (new)
Annex I – Part I – subheading 2 - indent 3 a (new)
- The International Convention on the Protection of the Rights of all Migrant Workers and Members of their Families;
Amendment 1664 #
Proposal for a directive
Annex I – Part I – subheading 2 - indent 9 a (new)
Annex I – Part I – subheading 2 - indent 9 a (new)
- The United Nations Declaration on Human Rights Defenders;
Amendment 1665 #
Proposal for a directive
Annex I – Part I – subheading 2 - indent 10 a (new)
Annex I – Part I – subheading 2 - indent 10 a (new)
- The United Nations Declaration on the Rights of Peasants and Other People Working in Rural Areas;
Amendment 1670 #
Proposal for a directive
Annex I – Part I – subheading 2 - indent 14 a (new)
Annex I – Part I – subheading 2 - indent 14 a (new)
- The International Labour Organisation’s Convention on Indigenous and Tribal Peoples (no. 169);·
Amendment 1672 #
Proposal for a directive
Annex I – Part I – subheading 2 - indent 14 b (new)
Annex I – Part I – subheading 2 - indent 14 b (new)
- The International Labour Organisation’s Violence and Harassment Convention, 2019 (No. 190)
Amendment 1676 #
Proposal for a directive
Annex I – Part I – subheading 2 - indent 23 a (new)
Annex I – Part I – subheading 2 - indent 23 a (new)
- The rights to a clean, healthy and sustainable environment (UN GA A/76/L.75)
Amendment 1678 #
Proposal for a directive
Annex I – Part I – subheading 2 - indent 23 b (new)
Annex I – Part I – subheading 2 - indent 23 b (new)
- the Rome Statute of the International Criminal Court;
Amendment 1680 #
Proposal for a directive
Annex I – Part I – subheading 2 - indent 23 c (new)
Annex I – Part I – subheading 2 - indent 23 c (new)
- The instruments and conventions of international humanitarian law, including the four Geneva Conventions of 1949and their additional protocols;·
Amendment 1683 #
Proposal for a directive
Annex I – Part I – subheading 2 - indent 23 d (new)
Annex I – Part I – subheading 2 - indent 23 d (new)
- Occupational Safety and Health Convention,1981 (No. 155)
Amendment 1684 #
Proposal for a directive
Annex I – Part I – subheading 2 - indent 23 e (new)
Annex I – Part I – subheading 2 - indent 23 e (new)
- Promotional Framework for Occupational Safety and Health Convention, 2006 (No. 187)
Amendment 1686 #
Proposal for a directive
Annex I – Part I – subheading 2 - indent 23 f (new)
Annex I – Part I – subheading 2 - indent 23 f (new)
- Convention on preventing and combating violence against women and domestic violence (‘Istanbul Convention’)
Amendment 1689 #
Proposal for a directive
Annex I – Part I – subheading 2 - indent 23 g (new)
Annex I – Part I – subheading 2 - indent 23 g (new)
- The European Convention on Human Rights;
Amendment 1690 #
Proposal for a directive
Annex I – Part I – subheading 2 - indent 23 g (new)
Annex I – Part I – subheading 2 - indent 23 g (new)
- The European Social Charter;
Amendment 1692 #
Proposal for a directive
Annex I – Part I – subheading 2 - indent 23 h (new)
Annex I – Part I – subheading 2 - indent 23 h (new)
- The Charter of Fundamental Rights of the European Union;
Amendment 1695 #
Proposal for a directive
Annex I – Part II – subheading 1
Annex I – Part II – subheading 1
violations of EU internationally recognized objectives and prohibitions included in environmental conventionsand climate conventions and EU legislation
Amendment 1697 #
Proposal for a directive
Annex I – Part II – point 1 a (new)
Annex I – Part II – point 1 a (new)
1a. Violation of European environmental principles as defined in Article 191 TFEU;1b. Violation of one of the universally binding rules of customary international environmental law including but not limited to: (a) the obligation not to cause significant damage to the environment (prevention principle); (b) the principle that lack of full scientific certainty shall not be used as a reason for postponing cost-effective measures to prevent environmental degradation(precautionary approach); (c) the obligation to carry out an environmental impact assessment for activities likely to have a significant adverse impact on the environment; (d) the approach that the polluter should, in principle, bear the cost of pollution(polluter-pays principle)
Amendment 1698 #
Proposal for a directive
Annex I – Part II – point 12 a (new)
Annex I – Part II – point 12 a (new)
12a. Violation of the obligation to take all measures consistent with the UN Convention on the Laws of the Sea (UNCLOS) that are necessary to prevent, reduce and control pollution of the marine environment from any source, using for this purpose the best practicable means at their disposal and in accordance with their capabilities, in line with Article 194(1) of UNCLOS, and that shall include, inter alia, those designed to minimise to the fullest possible extent: (a) the release of toxic, harmful or noxious substances, especially those which are persistent, from land-based sources, from or through the atmosphere or by dumping pursuant to Article 194 (3) (a) of UNCLOS; (b) pollution from vessels, in particular measures for preventing accidents and dealing with emergencies, ensuring the safety of operations at sea, preventing intentional and unintentional discharges pursuant to Article 194 (3) (b) of UNCLOS; (c) pollution from installations and devices used in exploration or exploitation of the natural resources of the seabed and subsoil, in particular measures for preventing accidents and dealing with emergencies, ensuring the safety of operations at sea pursuant to Article 194 (3) (c) of UNCLOS; (d) pollution from other installations and devices operating in the marine environment, in particular measures for preventing accidents and dealing with emergencies, ensuring the safety of operations at sea pursuant to Article 194 (3)(d) of UNCLOS.
Amendment 1702 #
Proposal for a directive
Annex I – Part II – point 12 b (new)
Annex I – Part II – point 12 b (new)
12b. Violation of the Convention on Access to Information, Public Participation in Decision-making and Access to Justice in Environmental Matters (Aarhus Convention) as well as the Regional Agreement on Access to Information, Public Participation and Justice in Environmental Matters in Latin America and the Caribbean (Escazú Agreement).
Amendment 1703 #
Proposal for a directive
Annex I – Part II a (new)
Annex I – Part II a (new)
IIa violations of internationally recognised objectives and prohibitions regarding good governance included in EU and international conventions 1. OECD Guidelines for Multinational Enterprises, 2011 2. Council of Europe Civil law Convention on Corruption, 1999 3. United Nation Convention against Corruption, 2003 4. European Union Convention against Corruption Involving Officials, 1997 5. OECD Anti Bribery Convention, 1997 6. United Nations Basic Principles on the Independence of the Judiciary, 1985 7. United Nations Declaration of Basic Principles of Justice for Victims of Crime and Abuse of Power, 1985