Insights: German Supply Chain Law in Asia-Pacific

PrintMailRate-it

Due Diligence for responsible business conduct in Asia-Pacific

The German Supply Chain Law („Gesetz über die unternehmerischen Sorgfaltspflichten in Lieferketten”; short: Lieferkettengesetz) has been passed by parliament on 11 June 2021. It will enter into force on 1 January 2023 and applies to companies – regardless of their legal form – that have their head office, principal place of business or registered office in Germany, and have more than 3,000 employees. As of 1 January 2024, the threshold will be 1,000 employees. Within affiliated companies (Section 15 of the German Stock Corporation Act), the employees of all group companies are to be taken into account when calculating the number of employees; this also applies if a group company has its head office, principal place of business or registered office abroad.
With companies and suppliers along the global supply chains being covered by the law, its impact on international business setups will definitely be significant. This requires a thorough assessment and adjustment of existing compliance management. In our „Themenspecial” –structured in the following country chapters – we made local red flag case considerations that may help to raise awareness of the risks companies face with supply chains in ASEAN (Indonesia, Malaysia, Myanmar, Singapore, ThailandVietnam and the Philippines) as well as in China and India.

German Supply Chain LawGerman Supply Chain Law and its impact on international business models in Asia-Pacific

The objective of the law is to improve protection of human rights in global supply chains. The government draft states in an explanatory section that due to their strong integration into global sales and procurement markets, German companies are particularly confronted with human rights challenges in their supply chains. More »

German Supply Chain Law The German Supply Chain Law and its effects on German business in Asia-Pacific

The Asia-Pacific region is by far the most important economic region for German companies in the world. According to the German Federal Ministry for Economic Affairs and Energy, over 15 per cent of German exports went to Asia and over 21 per cent of imports came from Asia in 2020. More »

German Supply Chain Law German Supply Chain Law: Monitoring employment practices and environmental issues in Indonesia

Which risks occur along supply chains in Indonesia? There is quite a variety of potential risks likely to affect compliance with supply chain regulations in Indonesia. They include: Illegal logging, forest and land fire and poor waste management and illegal waste dumping. More »

German Supply Chain Law German Supply Chain Law: Monitoring employment practices and environmental issues in Malaysia

German companies must be aware of potential risks in their business activities in Malaysia under the German Supply Chain Act and, if necessary, take measures as stipulated within the LkSG. The country-specific risks for Malaysia arise on two different levels. More »

Lieferkettengesetz im AsiengeschäftGerman Supply Chain Law: Monitoring employment practices and environmental issues in Myanmar

The situation in Myanmar has fundamentally deteriorated since the military's coup in February 2021, including the control of supply chains. Targeted sanctions by Europe and the United States against military personnel and units, as well as companies with military involvement, require a detailed investigation of supply chains. More »

Lieferkettengesetz im AsiengeschäftGerman Supply Chain Law: Monitoring employment practices and environmental issues in the Philippines

In the past years the Philippine Government occasionally made international headlines about alleged human right violations related to its so called “War on Drugs”. This has to be distinguished from the human rights situation and business practices from a corporate and economic perspective. More »

German Supply Chain Law German Supply Chain Law: Monitoring employment practices and environmental issues in Singapore

There can be risks due to unstable political conditions of a country, especially countries where the direct suppliers and indirect suppliers are located in the region. Further, due to the Covid-19 situation in the last two years, there have been shortage of manpower which has affected many industries, including the construction industry and industries which have heavily depended on manufacturing capabilities of countries in the region. More »

German Supply Chain Law German Supply Chain Law: Monitoring employment practices and environmental issues in Thailand

Common risks concerning supply chains in Thailand are as follows: Forced labour and human trafficking in the Thai fishing industry: Companies should be aware that the Thai fishing industry has been found to be implicated in forced labour and human trafficking. More »

German Supply Chain Law German Supply Chain Law: Monitoring employment practices and environmental issues in Vietnam

Although Vietnam has a comprehensive legal framework of relevant labor standards, the practice of the implementation of labor standards in Vietnam remains patchy due to a lack of effective monitoring and enforcement measures. More »

German Supply Chain LawGerman Supply Chain Law: Monitoring employment practices and environmental issues in China

In China, reported cases of child labor, i.e. working minors under the age of 16, have decreased to a considerable extent over the last decades, but certain vulnerabilities still remain in practice. Reasons for this rather positive development are the gradual move of China’s industry. More »

German Supply Chain LawGerman Supply Chain Law: Monitoring employment practices and environmental issues in India

In India the highest risks can be seen in non-compliance with the existing labour and environmental laws.Topics that often are being named with respect to supply chain risks are child labour or unequal treatment of employees. More »

last updated on 5 May 2022
Deutschland Weltweit Search Menu