On 9/14/22, the European Commission adopted a proposal for a regulation that aspires to strengthen due diligence on respect for workers’ rights and ban the placing and processing in the EU market of commodities and products derived from forced labor, including child exploitation. (1)
1) Forced labor. Notion
ILO, International Labor Organization, defines forced labor as ‘any work or service that is required of any person under duress and for which the person has not volunteered‘.
And he provides some indicators in this regard:
- Restriction on the freedom of movement of workers,
- Withholding of wages or identity documents,
- Physical or sexual violence,
- threats and intimidation,
- fraudulent debts.
At least 27.6 million people, according to ILO’s (inevitably biased) estimates, are currently in forced labor. Mostly (86%) in the private sector and minimally (14%) on state and/or judicial order. Particularly in manufacturing and construction, agriculture and fishing, and domestic work. (2)
2) Proposed EU Regulation
The proposed EU regulation provides, at a preliminary stage, for in-depth investigations into the potential risks of forced labor in different supply chains (Article 4). Based on data and indicators developed by the International Labor Organization (ILO), as well as on multiple sources of information (e.g., civil society input, on-site audits and inspections, surveys of individual companies. Article 5).
A database on the risks of forced labor, with regard to specific products and geographic areas, will be created and updated through survey and monitoring data (Article 11). The European Commission will ensure coordination among member states’ designated authorities, as well as issue guidance on due diligence, risk indicators, consistency with other EU regulations (Articles 12,13).
2.1) Responsibilities of operators
Operators in the EU will be responsible for importing, processing and distributing products that do not derive from or contain goods derived from forced labor (proposed regulation, Articles 3, 2.1.f, 2.1.g).
Due diligence
. ‘“Forced labor due diligence” means the efforts made by the economic operator to implement mandatory requirements, voluntary guidelines, recommendations, or practices to detect, prevent, mitigate, or end the use of forced labor in connection with products to be made available on the Union market or to be exported‘ (proposed regulation, Art. 2.1.c).
2.2) Ban on forced labor products
Customs authorities at EU borders will have to receive from importers ‘information identifying the product, information on the manufacturer or producer, and information on suppliers of products entering and leaving the Union market that have been identified by the Commission as being at risk of forced labor‘ (Article 16).
These authorities will be required to identify and detain at customs all goods in relation to which there are reasonable suspicions of derivation from forced labor (Article 17). The designated national authorities will in turn be responsible for controls on the ground, with a duty to withdraw from the market and seize products obtained by forced labor (Articles 5,6,7).
2.3) Supervision and Sanctions
In cases of a finding of forced labor in the supply chain, operators will have to withdraw products from the market and dispose of them at their own expense.
National authorities, in such cases, will ban the placing on the market andexport of the products. Applying relevant sanctions where appropriate.
2.4) Principle of proportionality, small and medium-sized enterprises
Implementation of the regulation by the competent authorities will have to take into account:
- size and resources of the economic operators involved,
- magnitude of the risk of forced labor.
Small and medium-sized enterprises will receive special tools to support them in meeting the new due diligence requirements. (3)
3) Forced labor and due diligence
The draft regulation under consideration on closer inspection complements, through uniform standards, the broader proposal for a directive on due diligence on respect for human rights and the environment, adopted on 23.2.22 by the European Commission (4,5).
Implementing appropriate due diligence policies will enable companies to identify, prevent, mitigate and account for actual or merely potential risks of forced labor in their respective operations, supply chains and business relationships.
4) Next steps
The proposal will have to be debated and approved by the European Parliament and the Council of the European Union before it can enter into force and will apply from the next 24 months.
Dario Dongo and Elena Bosani
Notes
(1) European Commission. Proposal for a regulation on prohibiting products made with forced labor on the Union market. https://single-market-economy.ec.europa.eu/system/files/2022-09/COM-2022-453_en.pdf COM(2022) 453
(2) ILO. 50 million people worldwide in modern slavery. https://www.ilo.org/global/about-the-ilo/newsroom/news/WCMS_855019/lang–en/index.htm 12.9.22
(3) European Union, External Action. Guidance on due diligence for EU businesses to address the risk of forced labor in their operations and supply chains. https://trade.ec.europa.eu/doclib/docs/2021/july/tradoc_159709.pdf 12.7.21
(4) Dario Dongo, Elena Bosani. Due diligence and ESG, corporate social and environmental sustainability, the proposed EU directive. GIFT (Great Italian Food Trade). 20.4.22
(5) European Commission. Proposal for a Directive of the European Parliament and of the Council on a business duty of care for sustainability and amending Directive (EU) 2019/1937. https://eur-lex.europa.eu/legal-content/IT/TXT/?uri=CELEX:52022PC0071&print=true COM/2022/71 final
Dario Dongo, lawyer and journalist, PhD in international food law, founder of WIISE (FARE - GIFT - Food Times) and Égalité.
Lawyer in Milan and Frankfurt am Main. An expert in family, juvenile and criminal law, she is now enrolled in a university master's programme in food law
