Regulation on prohibiting products made with forced labour on the Union market
In “An Economy that Works for People”
In her State of the Union speech 2021 president von der Leyen promised that the Commission would address the issue of forced labour in international supply chains by effectively banning products from EU market. Between 23 May 2022 and 20 June 2022, the Commission held a public consultation to give stakeholders the opportunity to provide their input in the preparation of the legislative proposal. On 14 September 2022, the Commission put forward a legislative proposal in the form of a regulation that would prohibit all products made using forced labour on the EU market.
The proposal covers all products made available within the EU market, meaning both products made in the EU for domestic consumption and for export, as well as imported goods. It would apply to products of any type, including their components, regardless of the sector. Member States authorities would mainly be responsible for the enforcement. They would conduct investigations following a risk-based approach and withdraw products from the EU market, once there is evidence that these were made with forced labour. Member States' customs authorities would enforce the ban at EU borders. In view of a structured coordination and cooperation between the Member States authorities and the Commission, a new platform, the EU Forced Labour Product Network, would be established. Companies would receive guidelines, SME in particular would benefit from support tools.
The Commission has chosen to submit its proposals in a regulation in order to avoid obstacles to the free movement of goods in the internal market and to remove possible distortions of competition caused by diverging national laws.
The proposed regulation is meant to complete the EU legislative framework on forced labour. Currently, there is no Union legislation that empowers Member States’ authorities to ban and withdraw a product from the market.
A resolution adopted by the EP Plenary on 9 June 2022 had called for a new trade instrument to ban the import and export of products made or transported by forced labour. According to the Parliament proposal, public authorities of Member States should detain goods at the EU border when they consider that there is sufficient evidence that these goods were made or transported using forced labour.
The Committee on Internal Market and Consumer Protection (IMCO) together with the Committee on International Trade (INTA) lead the file in a joint committee procedure, while the Committee on Employment and Social Affairs (EMPL) and the Committee on Foreign Affairs (AFET) are associated committees.
Ms Maria-Manuel Leitão-Marques (S&D, Portugal) and Ms Samira Rafaela (Renew Europe, the Netherlands) have been appointed as rapporteurs for the file.
The draft report was presented at the joint committee meeting of 23 May 2023.
The co-Rapporteurs highlighted in particular issues such as remediation for victims of forced labour, reversal of the burden of proof, Commission's guidelines to help inter alia SMEs, and extension of scope also to packaging, transport and distribution of goods.
On 16 October 2023 the Internal Market and International Trade committees adopted the draft report with 66 votes for, 0 against and 10 abstentions.
MEPs amended the Commission proposal to the effect that they reversed the burden of proof for goods produced in high-risk areas. For these goods, authorities would no longer need to prove that people have been forced to work, as the burden of proof would fall on companies. MEPs call on the European Commission to provide a list of of geographical areas and economic sectors at high risk of using forced labour.
Furthermore MEPs ensured that products made with forced labour are banned from the internal market until the company demonstrates it has stopped using forced labour in its production or supply chain and workers are compensated for the harm done to them.
MEPs have also updated and widened the definitions used in the text. In particular they aligned the definition of forced labour to ILO standards.
The report will be announced in plenary on 20 November 2023.
In the Council, discussions in preparatory bodies have started.
On 24 January 2023 the European Economic and Social Committee (EESC) issued a mandatory opinion on the Commission proposal. The EESC highlights the civil society's role and appreciates the proposed assistance for companies. With regard to the envisaged database, the advisory committee suggests the introduction of a benchmarking system. The EESC also suggests a Public EU Rating Agency for environmental and social sustainability, as well as human rights in the business context.
- European Parliament Legislative Observatory, Procedural file on Prohibiting products made with forced labour on the Union market, 2022/0269(COD)
- European Commission, Proposal for a regulation on prohibiting products made with forced labour on the Union market, COM(2022) 453, 14 September 2022
- European Parliament, Legislative initiative procedure 2020/2129(INL) Corporate due diligence and corporate accountability
- European Parliament, 2022/2611(RSP), Resolution of 9 June 2022 on a new trade instrument to ban products made by forced labour
- European Commission, Proposal for a Directive on corporate sustainability due diligence 2022/0051 (COD), 23 February 2022
- European Commission, Sustainable Corporate Governance public consultation
- European Economic and Social Committee, Forced labour products ban, 24 January 2023
- European Parliament, Study requested by the Jury Committee, Corporate social responsibility (CSR) and its implementation into EU Company law, November 2020
- European Parliament, Briefings requested by DROI Subcommittee, Human Rights Due Diligence Legislation: Options for the EU, June 2020
- EPRS Study, Corporate due diligence and corporate accountability, European added value assessment, October 2020
- ERPS Briefing, Towards a mandatory EU system of due diligence for supply chains, October 2020
- European Commission, External Study on due diligence requirements through the supply chain, February 2020
- European Economic and Social Committee, Opinion on mandatory due diligence, September 2020
Author: Anne Altmayer, Members' Research Service, email@example.com