The European Union plans to soften its supply chain law aimed at protecting human rights before it comes into effect, reports LETA citing DPA.
On Tuesday, during negotiations in Brussels, representatives of EU countries and the European Parliament agreed that these standards should apply only to a limited number of large companies.
For the changes to take effect, they still need to be approved by the European Parliament and EU countries, but this is usually a formality.
According to the revised plan, the law will only apply to large enterprises with more than 5,000 employees and an annual turnover exceeding 1.5 billion euros. Initially, it was proposed that it would apply to companies with at least 1,000 employees and an annual revenue of 450 million euros.
Additionally, companies that violate these standards will no longer face civil liability at the EU level. Instead, fines of up to 3% of their global net turnover may be imposed for non-compliance with the rules.
Negotiators also reported that the requirement for companies to adopt a transition plan to mitigate the effects of climate change will be abolished.
"Today, we fulfilled our promise to remove barriers and excessive regulations, as well as to promote the competitiveness of the EU. This is an important step towards creating a more favorable business environment to help our companies grow and innovate," said Denmark's EU Affairs Minister Maria Bjerre.
The aim of the supply chain law is to strengthen human rights protection globally by establishing accountability for large companies profiting from violations such as child or forced labor.
Companies oppose this plan, insisting that the bureaucratic burden of monitoring potential violations in complex supply chains is unmanageable.
Attempts to soften the law came from the right-wing majority in the European Parliament and faced sharp criticism from the factions of liberals, social democrats, and greens.
To reach an agreement, the European People's Party, representing the conservative bloc, broke traditional informal alliances with social democrats and liberals. This will be the first significant law passed under a clear right-wing majority.
German Social Democratic Party MEP Timo Wölken called this vote a dark day for Europe, stating that human rights and climate protection have become mere bargaining chips.
Anna Cavazzini from the German Green Party said that conservatives in the European Parliament and EU countries have effectively driven the final nail into the coffin of the EU supply chain law.
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