The tracker · Germany

German Supply Chain Due Diligence Act

Reform proposedGermanyEntry updated May 2026

The German due diligence law that shaped supplier questionnaires worldwide, now being folded into CSDDD transposition.

StatusReform proposed
EnactedJanuary 2023
First compliance deadlineJanuary 2023 (3,000+ employees); January 2024 (1,000+)
Companies in scopeCompanies with 1,000 or more employees in Germany
Maximum penaltyUp to 2 percent of average annual turnover for the largest companies
Civil liabilityNo new civil cause of action; special litigation standing for trade unions and NGOs
Enforcement bodyFederal Office for Economic Affairs and Export Control (BAFA)

Latest movement

Reporting abolished and fines narrowed; due diligence duties remain in force pending CSDDD transposition.

In plain language

What this law does

The LkSG obliges companies with at least 1,000 employees in Germany to conduct risk analyses, adopt preventive and remedial measures, operate complaints procedures and document their due diligence across own operations and direct suppliers, extending to indirect suppliers on substantiated knowledge of risk.

The 2025 coalition agreement committed to replacing the LkSG with a lean CSDDD-implementing law. The reporting obligation was removed in 2025 and enforcement narrowed to serious violations while the replacement bill moves through the Bundestag. For suppliers, BAFA-driven questionnaires have already slowed, but German buyers continue to run LkSG-shaped systems as the baseline for CSDDD readiness.

Obligations

What it asks of companies

  1. Annual and ad hoc risk analysis

    Companies must analyse human rights and environmental risks annually and when the risk situation changes materially.

  2. Preventive and remedial measures

    Identified risks require documented preventive measures with suppliers and remedial action where violations occur.

  3. Complaints procedure

    An accessible grievance channel must be available to workers and affected parties throughout the supply chain.

January 2023

Act applied to companies with 3,000 or more employees.

January 2024

Threshold lowered to 1,000 employees.

April 2025

Coalition agreement announced repeal and replacement through the CSDDD transposition.

September 2025

Cabinet bill abolished the reporting duty retroactively and narrowed the fines catalogue.

October 2025

BAFA limited enforcement to serious violations and stopped reviewing reports.

January 2026

Bundestag began deliberating the amendment bill.

Changelog

Entry history

May 2026

Entry updated to track the repeal-and-replace bill and narrowed BAFA enforcement.

Trade under this regime · Regulated Trade Index

Exposed export value at full application, across the ten tracked origins · Figures come from UN Comtrade. For each country we use what its buyer markets reported importing, rather than what the country itself reported exporting, because several tracked countries report to Comtrade late or not at all. Every share is measured against that country's exports to the nine regulated markets this index tracks, not against its total exports to the world, because no reliable world total exists for countries that under-report. European Union figures add up all twenty seven member states. The European product breakdown by chapter is estimated from the four largest importers, Germany, France, the Netherlands and Italy, and scaled up to the full twenty seven member total, so it captures which products dominate without understating any single one. · methodology

$37bn
Vietnam$9.5bnIndia$8.9bnBrazil$5.6bnThailand$5.4bnBangladesh$5.3bnIndonesia$2.8bn

Sources

Primary documents