71 Amendments of Adrián VÁZQUEZ LÁZARA related to 2022/0051(COD)
Amendment 305 #
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, priorisation, prevention and mitigation, bringing to an end, remediation and minimisation of potential or actual adverse human rights and environmental impacts connected with companies’ own operations, subsidiaries and value chains.
Amendment 313 #
Proposal for a directive
Recital 15
Recital 15
(15) Companies should take appropriate steps to set up and carry out due diligence measures, with respect to their own operations, their subsidiaries, as well as their established direct and indirectmonitored 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. AWhen establishing which business relationship should be monitored, account should be taken of the specificities of the company’s value chain, sector or geographical area in which its value chain partners operate, and the company’s power to influence or effectively control its direct and indirect business relationships, and whether the company could increase its power of influence.
Amendment 331 #
Proposal for a directive
Recital 18
Recital 18
(18) The value chain should cover activities related to the production and supply of a good or provision of services by a company, including the development of the product or the service and the use and disposal of the product as well as the related activities of established business relationships of the company. It should encompass upstream established direct and indirect. It should encompass upstream monitored business relationships that design, extract, manufacture, transport, store and supply raw material, products, parts of products, or provide services to the company that are necessary to carry out the company’s activities, and also downstream relationships, including established direct and indirect business relationships, that use or receive products, parts of products or services from the company up to the end of life of the product, including inter alia the distribution of the product to retailers, the transport and storage of the product, dismantling of the product, its recycling, composting or landfillingconsisting in carrying out operations for the company or on behalf of the company, such as the distribution to wholesalers or consumers, transportation, dismantling recycling of the product or landfilling of waste resulting from the operations of the company.
Amendment 344 #
Proposal for a directive
Recital 20
Recital 20
(20) In order to allow companies to properly identify the adverse impacts in their value chain and to make it possible for them to exercise appropriate leverage, the due diligence obligations should be limited in this Directive to establishmonitored business relationships. For the purpose of this Directive, established business relationships should mean such direct and indirect business relationships which are, or which are expected to be lasting, in viewBusiness relationships will be deemed to be monitored by the company itself, based ofn their intensity and duration and which do not represent a negligible or ancillary part of the value chain. The nature of business relationships as “established” should be reassessed periodically, and at least every 12 months. If the direct business relationship of a company is established, then all linked indirect business relationships should also be considered degree of control it has over them. For the purpose of this Directive, monitored business relationships should mean such direct and indirect business relationships. The nature of business relationships as “monitored” should be reas sestablished regarding that companysed periodically, and at least every 12 months.
Amendment 360 #
Proposal for a directive
Recital 23
Recital 23
(23) In order to achieve fully the objectives of this Directive addressing human rights and adverse environmental impacts with respect to companies’ operations, subsidiaries and 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 150 million worldwide and at least 40 million in the Union in the financial year preceding the last financial year or a net worldwide turnover of more than EUR 40 million but less than EUR 150 million in the financial year preceding the last financial year provided that at least 50% of its net worldwide turnover was generated in one or more of the high- impact sectors, as of 2 years after the end of the transposition period of this Directive.
Amendment 362 #
Proposal for a directive
Recital 24
Recital 24
(24) For defining the scope of application in relation to non-EU companies the described share of turnover criterion should be chosen as it creates a territorial connection between the third- country companies and the Union territory. Turnover is a proxy for the effects that the activities of those companies could have on the internal market. In accordance with international law, such effects justify the application of Union law to third-country companies. However, the overall worldwide net turnover threshold should be the same as that applied to companies established in the EU in order to create a level playing field between both EU and non-EU companies. To ensure identification of the relevant turnover of companies concerned, the methods for calculating net turnover for non-EU companies as laid down in Directive (EU) 2013/34 as amended by Directive (EU) 2021/2101 should be used. To ensure effective enforcement of this Directive, an employee threshold should, in turn, not be applied to determine which third-country companies fall under this Directive, as the notion of “employees” retained for the purposes of this Directive is based on Union law and could not be easily transposed outside of the Union. In the absence of a clear and consistent methodology, including in accounting frameworks, to determine the employees of third-country companies, such employee threshold would therefore create legal uncertainty and would be difficult to apply for supervisory authorities. The definition of turnover should be based on Directive 2013/34/EU which has already established the methods for calculating net turnover for non-Union companies, as turnover and revenue definitions are similar in international accounting frameworks too. With a view to ensuring that the supervisory authority knows which third country companies generate the required turnover in the Union to fall under the scope of this Directive, this Directive should require that a supervisory authority in the Member State where the third country company’s authorised representative is domiciled or established and, where it is different, a supervisory authority in the Member State in which the company generated most of its net turnover in the Union in the financial year preceding the last financial year are informed that the company is a company falling under the scope of this Directive.
Amendment 369 #
Proposal for a directive
Recital 27
Recital 27
(27) In order to conduct appropriate human rights, and environmental due diligence with respect to their operations, their subsidiaries, and their value chains, companies covered by this Directive should integrate due diligence into corporate policies, identify, prioritise, prevent and mitigate as well as bring to an end, remedy and minimise the extent of potential and actual adverse human rights and environmental impacts, establish and maintain a complaints procedure, monitor the effectiveness of the taken measures in accordance with the requirements that are set up in this Directive and communicate publicly on their due diligence. In order to ensure clarity for companies, in particular the steps of preventing and mitigating potential adverse impacts and of bringing to an end, or when this is not possible, minimising actual adverse impacts should be clearly distinguished in this Directive.
Amendment 373 #
Proposal for a directive
Recital 28
Recital 28
(28) In order to ensure that due diligence forms part of companies’ corporate policies, and in line with the relevant international framework, companies should integrate due diligence into all their corporate policies and have in place a due diligence policy. The due diligence policy should contain a description of the company’s approach, including in the long term, to due diligence, a code of conduct describing the rules and principles to be followed by the company’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 establishmonitored business relationships. The code of conduct should apply in all relevant corporate functions and operations, including procurement and purchasing decisions. Companies should also update their due diligence policy annually.
Amendment 375 #
Proposal for a directive
Recital 28 a (new)
Recital 28 a (new)
(28a) Parent companies can design due diligence policies for their subsidiaries. Parent companies can provide resources for their subsidiaries to help implement the due diligence policies decided at their level. In order to hold subsidiaries accountable, the liability created by the article 22 of this directive should remain at entity level the parent company’s due diligence policies remains under the supervision of supervisory authorities.
Amendment 381 #
Proposal for a directive
Recital 30
Recital 30
(30) Under the due diligence obligations set out by this Directive, a company should identify actual or potential adverse human rights and environmental impacts. In order to allow for a comprehensive identification of adverse impacts, such identification should be based on quantitative and qualitative information. For instance, as regards adverse environmental impacts, the company should obtain information about baseline conditions at higher risk sites or facilities in value chains. Identification of adverse impacts should include assessing the human rights, and environmental context in a dynamic way and in regular intervals: prior to a new activity or relationship, prior to major decisions or changes in the operation; in response to or anticipation of changes in the operating environment; and periodically, at least every 12 months, throughout the life of an activity or relationship. Regulated financial undertakings providing loan, credit, or other financial services should identify the adverse impacts only at the inception of the contract. When identifying adverse impacts, companies should also identify and assess the impact of a business relationship’s business model and strategies, including trading, procurement and pricing practices. Where the company cannot prevent, bring to an end or minimize all its adverse impacts at the same time, it should be able to prioritize its action, provided it takes the measures reasonably available to the company, taking into account the specific circumstances.
Amendment 390 #
Proposal for a directive
Recital 32
Recital 32
(32) In line with international standards, prevention and mitigation as well as bringing to an end and minimisation of adverse impacts should take into account the interests of those directly and adversely impacted. In order to enable continuous engagement with the value chain business partner instead of termination of business relations (disengagement) and possibly exacerbating adverse impacts, this Directive should ensure that disengagement is a last-resort action, in line with the Union`s policy of zero- tolerance on child labour. Terminating a business relationship in which child labour was found could expose the child to even more severe adverse human rights impacts. This should therefore be taken into account when deciding on the appropriate action to take. In cases where temporarily suspending or terminating a commercial relationship may be an option, companies should ensure that the suspension or termination does not result in a more severe impact on human rights or on the environment than the one that it intends to mitigate.
Amendment 391 #
Proposal for a directive
Recital 32 a (new)
Recital 32 a (new)
(32a) Under the due diligence obligations set out by this Directive, a company should rate the actual and potential adverse impacts according to their severity, urgency and risk. The company should then prioritise the risk and take the appropriate measures to prevent, remedy or bring the adverse impact to an end.
Amendment 400 #
Proposal for a directive
Recital 34
Recital 34
(34) So as to comply with the prevention and mitigation obligation under this Directive, companies should be required to take the following actions, where relevant. Where necessary due to the complexity of prevention measures, companies should develop and implement a prevention action plan. Companies should seek to obtain contractual assurances from a direct partner with whom they have an establish monitored 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 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 establish monitored business relationship such as financing, for example, through direct financing, low-interest loans, guarantees of continued sourcing, and assistance in securing financing, to help implement the code of conduct or prevention action plan, or technical guidance such as in the form of training, management systems upgrading, and collaborate with other companies.
Amendment 411 #
Proposal for a directive
Recital 37
Recital 37
(37) As regards direct and indirect business relationships, industry cooperation, industry schemes and multi- stakeholder initiatives can help create additional leverage to identify, mitigate, and prevent adverse impacts. Therefore it should be possible for companies to rely on such initiatives to support the implementation of their due diligence obligations laid down in this Directive to the extent that such schemes and initiatives are appropriate to support the fulfilment of those obligations. Companies could assess, at their own initiative, the alignment of these schemes and initiatives with the obligations under this Directive. In order to ensure full information on such initiatives, the Directive should also refer to the possibility for the Commission and the Member States to facilitate the dissemination of information on such schemes or initiatives and their outcomes. The Commission, in collaboration with Member States, mayshall issue guidance for assessing the fitness of industry schemes and multi-stakeholder initiatives.
Amendment 415 #
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 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 establishmonitored 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 adverse impacts to an end and minimisation of their extent, where relevant depending on the circumstances.
Amendment 419 #
Proposal for a directive
Recital 39
Recital 39
(39) So as to comply with the obligation of bringing to an end and minimising the extent of actual adverse impacts under this Directive, companies should be required to take the following actions, where relevant. They should neutralise the adverse impact or minimise its extent, with an action proportionate to the significance and scale of the adverse impact and to the contribution of the company’s conduct to the adverse impact. Where necessary due to the fact that the adverse impact cannot be immediately brought to an end, companies should develop and implement a corrective action plan with reasonable and clearly defined timelines for action and qualitative and quantitative indicators for measuring improvement. Companies should also seek to obtain contractual assurances from a direct business partner with whom they have an establish monitored business relationship that they will ensure compliance with the company’s code of conduct and, as necessary, a prevention action plan, including by seeking corresponding contractual assurances from its partners, to the extent that their activities are part of the company’s value chain. The contractual assurances should be accompanied by the appropriate measures to verify compliance. Finally, companies should also make investments aiming at ceasing or minimising the extent of adverse impact, provide targeted and proportionate support for an SMEs with which they have an establishmonitored business relationship and collaborate with other entities, including, where relevant, to increase the company’s ability to bring the adverse impact to an end.
Amendment 420 #
Proposal for a directive
Recital 39
Recital 39
(39) So as to comply with the obligation of bringing to an end and minimising the extent of actual adverse impacts under this Directive, companies should be required to take the following actions, where relevant. They should neutralise the adverse impact or minimise its extent, with an action proportionate to the significance and scale of the adverse impact and to the contribution of the company’s conduct to the adverse impact. Where necessary due to the fact that the adverse impact cannot be immediately brought to an end, companies should develop and implement a corrective action plan with reasonable and clearly defined timelines for action and qualitative and quantitative indicators for measuring improvement. Companies should also seek to obtain contractual assurances from a direct business partner with whom they have an establish monitored business relationship that they will ensure compliance with the company’s code of conduct and, as necessary, a prevention action plan, including by seeking corresponding contractual assurances from its partners, to the extent that their activities are part of the company’s value chain. The contractual assurances should be accompanied by the appropriate measures to verify compliance. Finally, companies should also make investments aiming at ceasing or minimising the extent of adverse impact, provide targeted and proportionate support for an SMEs with which they have an establish monitored business relationship and collaborate with other entities, including, where relevant, to increase the company’s ability to bring the adverse impact to an end.
Amendment 429 #
Proposal for a directive
Recital 42
Recital 42
(42) Companies should provide the possibility for persons and organisations to submit complaints directly to them in case of legitimate concerns regarding actual or potential human rights and environmental 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. 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, well-founded 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 430 #
Proposal for a directive
Recital 42 a (new)
Recital 42 a (new)
(42a) In order to bring to settle disputes between victims and companies swiftly, extra-judicial remedies should be setup. The remedy should be determined in consultation with the affected stakeholders and may consist of financial or non-financial compensation, reinstatement, public apologies, restitution, rehabilitation or a contribution to an investigation. To ensure that remedies are satisfactory to both parties, and that the weaker party is not forced into settlement by the stronger party, impartial third parties should mediate in order to assist companies and stakeholders in finding extra-judicial remedies, as is today the case under the OECD national contact points system. A settlement fairly mediated, the outcome of which is accepted by both parties should prevent civil proceeding and the filing of claims before a court.
Amendment 435 #
Proposal for a directive
Recital 43
Recital 43
(43) Companies should monitor the implementation and effectiveness of their due diligence measures. They should carry out periodic assessments of their own operations, those of their subsidiaries and, where related to the value chains of the company, those of their establishmonitored 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 441 #
Proposal for a directive
Recital 45
Recital 45
(45) In order to facilitate companies’ compliance with their due diligence requirements through their value chain and limiting shifting compliance burden on SME business partners, the Commission should provide, within the twelve months following the entry into force of the Directive, guidance on model contractual clauses.
Amendment 445 #
Proposal for a directive
Recital 46
Recital 46
(46) In order to provide support and practical tools to companies or to Member State authorities on how companies should fulfil their due diligence obligations, the Commission, using relevant international guidelines and standards as a reference, and 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, should have the possibility toall issue guidelines, including for specific sectors or specific adverse impacts.
Amendment 449 #
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 crisis. 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. Some SMEs might want to voluntarily apply the due diligence framework. They should be incentivized to do so and rewarded for doing so. Member states should, for instance, adapt their rating systems for public procurements so that candidates and tenderers who are not in the scope of the directive, notably SMEs, but do comply with due diligence obligation schemes are rated more positively than other tenderers who do not. Member states, professional and sectoral organisations are encouraged to set up labelling systems to identify which companies falling out of the scope of this Directive apply certified due diligence schemes equivalent to the obligations laid out in this Directive.
Amendment 456 #
Proposal for a directive
Recital 50
Recital 50
(50) In order to ensure that this Directive effectively contributes to combating climate change, companies should adopt a plan to ensure that the business model and strategy of the company are compatible with the transition to a sustainable economy and with the limiting of global warming to 1.5 °C in line with the Paris Agreement and the objective of achieving climate neutrality by 2050 as established in the EU Climate Law as well as, where relevant, its exposure to coal-, oil- and gas-related activities. In case climate is or should have been identified as a principal risk for or a principal impact of the company’s operations, the company should include emissions reduction objectives in its plan.
Amendment 459 #
Proposal for a directive
Recital 52
Recital 52
(52) In order to allow for the effective oversight of and, where necessary, enforcement of this Directive in relation to those companies that are not governed by the law of a Member State, those companies should designate a sufficiently mandated authorised representative in the Union and provide information relating to their authorised representatives. Failing to do so should lead to Member states excluding those companies from public procurements. It should be possible for the authorised representative to also function as point of contact, provided the relevant requirements of this Directive are complied with.
Amendment 469 #
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, prioritise 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, prioritised, prevented, mitigated, brought to an end or its extent minimised through the appropriate measures occurred and led to damage. Nonetheless, in cases where, as a consequence of the duty of prioritisation, the severe adverse impact arises from a lower prioritised adverse impact that was not yet addressed, the company should not be held liable, always provided that the prioritisation was adequate according to the severity, urgency and the likelihood of the adverse impacts.
Amendment 476 #
Proposal for a directive
Recital 57
Recital 57
(57) As regards damages occurring at the level of establishmonitored indirect business relationships, the liability of the company should be subject to specific conditions. The company should not be liable if it carried out specific due diligence measures. However, it should not be exonerated from liability through implementing such measures in case it was unreasonable to expect that the action actually taken, including as regards verifying compliance, would be adequate to prevent, mitigate, bring to an end or minimise the adverse impact. 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 477 #
Proposal for a directive
Recital 58
Recital 58
Amendment 510 #
Proposal for a directive
Article 1 – paragraph 1 – subparagraph 1 – point a
Article 1 – paragraph 1 – subparagraph 1 – point a
(a) on obligations for companies regarding actual and potential human rights adverse impacts and environmental adverse impacts, with respect to their own operations, the operations of their subsidiaries, and the value chain operations carried out by entities with whom the company has an establish monitored business relationship and
Amendment 521 #
Proposal for a directive
Article 1 – paragraph 1 – subparagraph 2
Article 1 – paragraph 1 – subparagraph 2
The nature of business relationships as ‘establish‘monitored’ shall be reassessed periodically, and at least every 12 months.
Amendment 522 #
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 the environment or the protection of the climate provided for byUnless provided in this Directive, Member States shall not lay down, in their national law, provisions diverging from those law of Member States at the time of the adoption ofid down in this Directive.
Amendment 531 #
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 605 #
Proposal for a directive
Article 2 – paragraph 2 – point a
Article 2 – paragraph 2 – point a
(a) generated a net worldwide turnover of more than EUR 150 million, provided that at least EUR 40 million was generated in the Union in the financial year preceding the last financial year;
Amendment 614 #
Proposal for a directive
Article 2 – paragraph 2 – point b
Article 2 – paragraph 2 – point b
(b) generated a net worldwide turnover of more than EUR 40 million but not more than EUR 150 million in the Union in the financial year preceding the last financial year, provided that at least 50% of its net worldwide turnover was generated in the Union and that at least 50% of its net worldwide turnover was generated in one or more of the sectors listed in paragraph 1, point (b).
Amendment 689 #
Proposal for a directive
Article 3 – paragraph 1 – point d
Article 3 – paragraph 1 – point d
(d) ‘subsidiary’ means a legal person as defined in Article 2, point (10), of Directive 2013/34/EU and a legal person through which the activity of a ‘controlled undertaking’ as defined in Article 2(1), point (f), of Directive 2004/109/EC of the European Parliament and of the Council128 is exercised; _________________ 128 Directive 2004/109/EC of the European Parliament and of the Council of 15 December 2004 on the harmonisation of transparency requirements in relation to information about issuers whose securities are admitted to trading on a regulated market and amending Directive 2001/34/EC (OJ L 390, 31.12.2004, p. 38).
Amendment 709 #
Proposal for a directive
Article 3 – paragraph 1 – point f
Article 3 – paragraph 1 – point f
(f) ‘establishmonitored business relationship’ means a business relationship, whether direct or indirect, which is, or which is expected to be lasting, in view of its intensity or duration and which does not represent a negligible or merely ancillary part of the value chainover which the company has effective control;
Amendment 717 #
Proposal for a directive
Article 3 – paragraph 1 – point f a (new)
Article 3 – paragraph 1 – point f a (new)
(fa) ‘effective control’ means the possibility for an undertaking to exercise decisive influence on another undertaking, in particular by ownership or the right to use all or part of the assets of the latter, or by rights or contracts or any other means, having regard to all factual considerations, which confer decisive influence on the composition, voting or decisions of the decision making bodies of an undertaking.
Amendment 721 #
Proposal for a directive
Article 3 – paragraph 1 – point g
Article 3 – paragraph 1 – point g
(g) ‘value chain’ means activities of the business partners of a company related to the production and supply of goods or the provision of services by a, including: (i) upstream direct and indirect business partners that design, extract, manufacture, transport, store and supply raw material, products, parts of products, or provide services to the company, including the development of the product or the service, and the use and disposal of the product as well as the related activities of upstream and downstream established business relationships of the company(ii) downstream direct and indirect business partners that distribute the product to wholesalers, retailers or consumers, transport and store the product, dismantle or recycle the product, including compost or landfill waste resulting from the operations of the company. The use of the product shall not be considered as part of the value chain for the purposes of this Directive. 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;
Amendment 752 #
Proposal for a directive
Article 3 – paragraph 1 – point j a (new)
Article 3 – paragraph 1 – point j a (new)
Amendment 767 #
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 bedirectly affected by the products, services and operations of that company, its subsidiaries and its business relationships, as well as their expressly designated representatives or advisers;
Amendment 806 #
Proposal for a directive
Article 4 – paragraph 1 – point b a (new)
Article 4 – paragraph 1 – point b a (new)
(ba) prioritising actual or potential adverse impacts in accordance with Article 6a;
Amendment 822 #
Proposal for a directive
Article 4 – paragraph 2
Article 4 – paragraph 2
2. Member States shall ensure that, for the purposes of due diligence, companies are entitled to share resources and information within their respective parent companies are entitled to design and implement due diligence policies for the subsidiaries of their group of companies falling under the scope of this Directive. The fact that groups of companies cand with o assume due diligence obligation should be without prejudice of ther legal entities in compliance with applicable competition lawiability regime of their subsidiaries under article 22 if they do not follow or fail to implement the policies designed by the group.
Amendment 844 #
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 and measures to be followed by the company’s employees and subsidiariesand implemented by the company;
Amendment 849 #
Proposal for a directive
Article 5 – paragraph 1 – point c
Article 5 – paragraph 1 – point c
(c) 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 establishmonitored business relationships;
Amendment 878 #
Proposal for a directive
Article 6 – paragraph 1
Article 6 – paragraph 1
1. Member States shall ensure that companies take appropriate measures to identifyprioritise actual and potential adverse human rights impacts and adverse environmental impacts arising from their own operations or those of their subsidiaries and, where related to their value chains, from their established business relationships, in accordance with paragraph 2, 3 and 4identified in article 6.
Amendment 914 #
Proposal for a directive
Article 6 – paragraph 4
Article 6 – paragraph 4
4. Member States shall ensure that, for the purposes of identifying the adverse impacts referred to in paragraph 1 based on, where appropriate, quantitative and qualitative information, companies are entitled to make use of appropriate resources, including independent reports and information gathered through the complaints procedure provided for in Article 9. Companies shall, where relevant, also carry out consultations with potentially affected groups including workers and other relevant stakeholders to gather information on actual or potential adverse impacts. As regards companies within the meaning of point (a)(iv), non- public information shall not be used for the purposes of this article in cases where it may result in an infringement of the Regulation(EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC.
Amendment 920 #
Proposal for a directive
Article 6 a (new)
Article 6 a (new)
Article 6a Prioritising actual and potential adverse impacts 1. Member States shall ensure that companies take appropriate measures to prioritise actual and potential adverse human rights impacts and adverse environmental impacts identified in article 5. 2. Companies shall be required to take appropriate measures to rank the actual and potential adverse impacts identified as per paragraph 1 according to their severity, urgency and likelihood. Severity shall be assessed based on the scale and scope of the adverse impact, such as the number of persons or the extent of the environment affected by it. Likelihood shall be assessed based on the possibility of occurrence of the adverse impact in a given timeframe and a given geographical area. Urgency shall be assessed based on the degree of materialisation and irremediability of the impact. 3. Once the most severe and likely adverse impacts are addressed in accordance with Articles 7 or 8 in a reasonable time, the company shall address less severe and less likely adverse impacts.
Amendment 935 #
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 action and qualitative and quantitative indicators for measuring improvement. The elaboration of the prevention action plan shall be developed inpreceded by a process of public consultation withopen to affected stakeholders and their advisers, who shall have a reasonable period of time for sending their suggestions, concerns and contributions;
Amendment 960 #
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 establish monitored business relationship, where compliance with the code of conduct or the prevention action plan would jeopardise the viability of the SME;
Amendment 1039 #
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 contribution of the company’s conduct to the adverse impact;
Amendment 1053 #
Proposal for a directive
Article 8 – paragraph 3 – point c
Article 8 – paragraph 3 – point c
(c) seek contractual assurances from a direct partner with whom it has an establish monitored 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.
Amendment 1066 #
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 establish monitored business relationship, where compliance with the code of conduct or the corrective action plan would jeopardise the viability of the SME;
Amendment 1138 #
Proposal for a directive
Article 9 – paragraph 1
Article 9 – paragraph 1
1. Member States shall ensure that companies provide the possibility for persons and organisations listed in paragraph 2 to submit complaints to them where they have legitimate concerns regarding actual or potential adverse human rights impacts and adverse environmental impacts with respect to their own operations, the operations of their subsidiaries and their value chains. The complaint procedure shall provide for the possibility to raise complaints anonymously and confidentially, according to the 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.
Amendment 1184 #
Proposal for a directive
Article 9 – paragraph 4 – introductory part
Article 9 – paragraph 4 – introductory part
4. Member States shall ensure that, when the complaint has solid factual grounds to be deemed admissible, complainants are entitled
Amendment 1206 #
Proposal for a directive
Article 9 – paragraph 4 a (new)
Article 9 – paragraph 4 a (new)
4a. Recourse to such procedures shall not preclude the complainant from pursuing legal action under the liability regime established in article 22.
Amendment 1210 #
Proposal for a directive
Article 9 a (new)
Article 9 a (new)
Article 9a Extra-judicial remedies and mediation process 1. Member States shall ensure that when an undertaking establishes that it has caused or contributed to an adverse impact, it provides for or cooperates with the remediation process. 2. The remedy may be proposed as a result of a complaint procedure as laid down in Article 9. 3. The remedy shall be determined in consultation with the affected stakeholders and may consist of financial or non-financial compensation, reinstatement, public apologies, restitution, rehabilitation or contribution to an investigation. 4. Member states shall establish contact points for due diligence mediation in order to assist undertakings and stakeholders in finding extra-judicial remedies. Those contact points should be impartial, predictable and equitable. 5. Undertakings shall prevent additional harm being caused by providing guarantees that the harm in question will not be repeated. 6. Member States shall ensure that the remediation process, if deemed satisfactory by both parties, prevents civil proceedings in accordance with national law. However, victims shall not be required to seek extra-judicial remedies before filing a claim before a court.
Amendment 1217 #
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 establishmonitored business relationships, to monitor the effectiveness of the identification, prevention, mitigation, bringing to an end and minimisation of the extent of human rights and environmental adverse impacts. Such assessments shall be based, where appropriate, on qualitative and quantitative indicators and be carried out at least every 12 months and whenever there are reasonable grounds to believe that significant new risks of the occurrence of those adverse impacts may arise. The due diligence policy shall be updated in accordance with the outcome of those assessments.
Amendment 1259 #
Proposal for a directive
Article 12 – paragraph 1
Article 12 – paragraph 1
In order to provide support to companies to facilitate their compliance with Article 7(2), point (b), and Article 8(3), point (c), the Commission shall adopt, within the twelve months prior to the application date of this Directive, guidance about voluntary model contract clauses.
Amendment 1268 #
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, within the twelve months following the entry into force of this Directive, issue guidelines, including for specific sectors or specific adverse impacts.
Amendment 1279 #
1. Member States shall, in order to provide information and support to companies and the partners with whom they have establishmonitored business relationships in their value chains in their efforts to fulfil the obligations resulting from this Directive, set up and operate individually or jointly dedicated websites, platforms or portals. Specific consideration shall be given, in that respect, to the SMEs that are present in the value chains of companies.
Amendment 1285 #
Proposal for a directive
Article 14 – paragraph 2 a (new)
Article 14 – paragraph 2 a (new)
2a. Without prejudice to Directive 2014/24/EU on public procurement and Directive 2014/25/EU on procurement by entities operating in the water, energy, transport and postal services sectors, Member States shall adapt their public procurements laws as to rate more positively candidate and tenderer companies who are not in the scope of this directive but voluntarily apply due diligence obligations stemming for it.
Amendment 1321 #
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 adopt a plan, including implementing actions and related financial and investments plans, to ensure that the business model and strategy of the company are compatible with the transition to a sustainable economy and with the limiting of global warming to 1.5 °C in line with the Paris Agreement and the objective of achieving climate neutrality by 2050 as established in Regulation (EU) 2021/1119 and where relevant, the exposure of the group to coal-, oil- and gas-related activities. 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.
Amendment 1425 #
Proposal for a directive
Article 20 – paragraph 1 a (new)
Article 20 – paragraph 1 a (new)
1a. Member States shall lay down the rules so that companies which are formed in accordance with the legislation of a third country under article 2.2 shall be excluded from public procurement processes if they fail to appoint an authorised representative under article 16.
Amendment 1466 #
Proposal for a directive
Article 21 – paragraph 8 a (new)
Article 21 – paragraph 8 a (new)
8a. The European Network of Supervisory Authorities shall publish a register of non-compliant companies for sustainability due diligence purposes. The competent supervisory authority shall list in this register companies that do not comply with the sanctions imposed on them in accordance with Article 20, as well as relevant information to allow for their effective identification by stakeholders and other companies for the purposes of identifying actual and potential adverse impacts.
Amendment 1481 #
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 8 occurred and led to damage. caused by the activity of the company or by the activity of a direct or indirect partner with which the company has a monitored business relationship.
Amendment 1484 #
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, prioritised, prevented, mitigated, brought to an end or its extent minimised through the appropriate measures laid down in Articles 7 and 8 occurred and led to damage.
Amendment 1502 #
Proposal for a directive
Article 22 – paragraph 2 – subparagraph 1
Article 22 – paragraph 2 – subparagraph 1
Notwithstanding paragraph 1, Member States shall ensure that where a company has taken the actions referred to in Article 7(2), point (b) and Article 7(4), or Article 8(3), point (c), and Article 8(5), it shall not be liable for damages caused by an adverse impact arising as a result of the activities of an indirect partner with whom it has an establish monitored business relationship, unless it was unreasonable, in the circumstances of the case, to expect that the action actually taken, including as regards verifying compliance, would be adequate to prevent, prioritise, mitigate, bring to an end or minimise the extent of the adverse impact.
Amendment 1503 #
Proposal for a directive
Article 22 – paragraph 2 – subparagraph 1
Article 22 – paragraph 2 – subparagraph 1
Notwithstanding paragraph 1, Member States shall ensure that where a company has taken the actions referred to in Article 7(2), point (b) and Article 7(4), or Article 8(3), point (c), and Article 8(5), it shall not be liable for damages caused by an adverse impact arising as a result of the activities of an indirect partner with whom it has an establish monitored business relationship, unless it was unreasonable, in the circumstances of the case, to expect that the action actually taken, including as regards verifying compliance, would be adequate to prevent, mitigate, bring to an end or minimise the extent of the adverse impact.
Amendment 1504 #
Proposal for a directive
Article 22 – paragraph 2 – subparagraph 1 a (new)
Article 22 – paragraph 2 – subparagraph 1 a (new)
Notwithstanding paragraph 1, Member States shall ensure that where, as a consequence of the duty of prioritisation set by Article 6a, the adverse impact arises from a lower prioritised adverse impact that was not yet addressed, the company cannot be held liable, always provided that the prioritisation was adequate according to the severity, urgency and the likelihood of the adverse impacts.
Amendment 1532 #
Proposal for a directive
Article 22 – paragraph 4 a (new)
Article 22 – paragraph 4 a (new)
4a. Member States shall ensure that only those individuals or entities directly and materially affected by an adverse impact are qualified to file an action for civil liability and seek damages under the rules and obligations set out by this Directive.
Amendment 1616 #
Proposal for a directive
Article 29 – paragraph 1 – point d a (new)
Article 29 – paragraph 1 – point d a (new)
(da) whether existing Union legislation is consistent with this Directive