Supply Chain Act and Foreign Trade Promotion
(Berlin, 28.07.2020) As non-governmental organisations, we very much welcome the fact that the Federal Government will regulate the due diligence obligations of companies by law. However, the previously known key issues paper lacks an effective link with foreign trade promotion.
So far, the key points known to us for a supply chain law (as amended in March 2020) only provide for companies to be excluded from public procurement for a certain period of time if they have been fined for violations of human rights and environmental due diligence. Foreign trade promotion should be provided as a further enforcement tool for the Supply Chain Act.
By granting state guarantees (hermetic guarantees, investment guarantees, UFK guarantees), the Federal Government actively supports German companies in their global business activities – especially in economically, but often also in difficult countries under human rights. The volume of guarantees granted in recent years has ranged between EUR 17 billion and more than EUR 25 billion per year. Due to their great importance, the UN Guiding Principles on Business and Human Rights (UNLP) explicitly mention export credit guarantees as an essential area of the state's economic nexus, in which governments have a special responsibility to encourage companies to exercise due diligence.
For breaches of the Supply Chain Act, the exclusion from foreign trade promotion should therefore be provided for as a sanction. This would provide a strong incentive for an additional segment of the German economy to comply with its duty of care.
Supporters:
- Counterflow
- primal force
- Forum Environment and Development
- FIAN
- Christian Initiative of Romero
Contact: PowerShift e.V.; http://power-shift.de
