Summary

Feedback Forced Labor Ban

Summary

The Federation of German Industries (BDI) shares the goal of preventing that goods made with forced labor are made available on and/or are re-exported from the Union market. In addition to our ethical objections, forced labor is a tripwire indicator for political instability, which in turn hurts access to procurement and target markets. What is more, such human exploitation distorts prices and creates competitive disadvantages.

BDI has serious concerns regarding the timeframe in which the forced labor ban is supposed to be implemented. We strongly suggest that legislators revise the present proposal in ways that ensures as smooth of an implementation as possible. For BDI this means:

− The database should be developed and field-tested, guidelines and FAQs should be completed, and informational requirements be clearly streamlined, to prevent doubled compliance burdens for companies.

− The competent authority should be available and its processes up and running when the regulation comes into effect. − Customs authorities should work in tandem with and not in addition to competent authorities. That will mean that accessibility and data processing should be functional by the time companies are expected to comply with the regulation. Moreover, by that time the single window environments by member states should also be functional.

− The regulation should be aligned with the Commission’s proposals on

Corporate Sustainability Due Diligence (CSDD) as well as Corporate

Sustainability Reporting. Regardless of jurisdiction and competence, we insist that it is in the EU’s best economic interest to do more than just regulate business behavior, but to enable companies to abide by the highest standards at the lowest costs possible.

− We fully agree with the Commission’s goal of creating near identical conditions for businesses within the single market and ask that Articles 13, 14, 24 remain essentially unchanged.

− BDI stresses that the forced labor ban can only be risk-based, if the burden of proof remains unreversed. In addition to rule-of-law concerns, then-necessary transaction-based controls would notservethe goal of the regulation but rather impede its efficacy.

Federation of German Industries

Member Association of BUSINESSEUROPE

Address Breite Straße 29 10178 Berlin Postal Address 11053 Berlin Germany Contact Dr. Nikolas Keßels

T:+49 30 2028 1518 F:+49 30 2028 2518 Internet www.bdi.eu E-Mail N.Kessels@bdi.eu