LkSG (Supply Chain Due Diligence Act)

1. Scope of application: The law applies to German companies with more than 3,000 employees and to foreign companies with a significant presence in Germany (more than 3,000 employees) or whose business activities have a significant impact on human rights or the environment in Germany.
2. Due diligence obligations: Companies are obliged to carry out regular risk analyses regarding human rights violations or environmental damage in their supply chains, take preventive measures and set up grievance mechanisms for affected persons.
3. Reporting obligations: Affected companies must publish annual reports documenting their due diligence obligations, including risk analyses carried out and risk mitigation measures taken.
4. Penalties: Companies that violate the law can face substantial fines and legal consequences.

The Supply Chain Due Diligence Act (LkSG) reflects Germany's commitment to promoting responsible business practices globally and protecting human rights and environmental standards within corporate supply chains.