In the coalition agreement, the CDU/CSU and SPD had actually held out the prospect of abolishing the national regulation. It has not come to that. However, on September 3, 2025, the Federal Cabinet passed a law to amend the Supply Chain Due Diligence Act. The Federal Government's draft bill at least provides for the complete abolition of reporting obligations in accordance with Section 10 (2) LkSG with retroactive effect for the reporting period from January 1, 2023. This means that reports do not have to be submitted to the Federal Office of Economics and Export Control ("BAFA") for past or future financial years.
However, the due diligence obligations set out in the LkSG continue to apply:
- Establishment of a risk management system
- Annual and ad hoc risk analyses
- Policy statement on the company's human rights strategy
- Preventive measures
- Remedial measures
- Establishment of a complaints procedure
However, breaches of these obligations are only sanctioned in the event of serious violations.
Until the EU Corporate Sustainability Due Diligence Directive (Directive (EU) 2024/1760) (CSDDD), which was adopted in July 2024, is transposed into national law (this must be done by 26 July 2027 at the latest), the present draft law is basically intended to ensure that German companies are not more heavily burdened than in other European countries.
In addition, the Federal Cabinet has passed a (long overdue) bill to implement the Corporate Sustainability Reporting Directive (Directive (EU) 2022/2464) (CSRD). The deadline for transposition into national law had already passed on July 6, 2024 and infringement proceedings had already been initiated by the EU Commission.
The draft law implements, among other things, the postponement of the reporting obligations under the Omnibus I package (Directive (EU) 2025/794).
We are always available to provide you with further support. Simply send us an email or use our contact form - we will help you to correctly classify the new regulations relating to the Supply Chain Duty of Care Act and the requirements of the CSDDD and CSRD and show you which steps are really relevant for your company now.
Author's note
This article has been machine translated into English.
DEFINITIONS AND ABBREVIATIONS
CSRD stands for Corporate Sustainability Reporting Directive, an EU directive that prescribes comprehensive and uniform sustainability reporting for companies.
CSDDD is the Corporate Sustainability Due Diligence Directive, which is known in German as the EU directive on the due diligence obligations of companies in the area of sustainability.
