LkSG
Lieferkettensorgfaltspflichtengesetz (LkSG) — German Supply Chain Due Diligence Act of 16 July 2021
Topic : Supply chain due diligence · Level : National
Today
Due diligence duties apply. BAFA stopped reviewing reports in late 2025; amendment abolishing reporting pending in Bundestag.
Summary
The LkSG requires companies with at least 1,000 staff in Germany to manage human rights and environmental risks in their supply chains. BAFA no longer reviews reports, and a bill to abolish reporting and narrow fines is pending.
Who is concerned
- Turnover
- non précisé
- Employees
- ≥1,000 employees in Germany
- Listed company
- cotées et non cotées
- Sectors
- All sectors
- Triggering activities
- HQ, seat or branch in Germany
- ≥1,000 employees in Germany
- Extraterritorial reach
- Yes
Covers own operations and direct suppliers abroad; indirect suppliers on substantiated knowledge.
- Examples
- German retailer sourcing apparel
- German carmaker buying parts in China
What the law requires
- Set up risk management and appoint a responsible person
- Run annual and ad-hoc risk analysis of direct suppliers
- Take prevention and remediation measures
- Run a complaints procedure and keep records 7 years
Penalties
Up to €8M (legal persons) or 2% of avg turnover if >€400M; tender exclusion up to 3 yrs. Draft keeps only 4 offence types (serious breaches).
What this changes for a supplier in China
German buyers still run risk analysis and audits on Chinese direct suppliers, including forced-labour and environmental risk checks, even with reporting relief.
Expected evidence
- Signed supplier code of conduct
- Social audit report or self-assessment
- Grievance channel and remediation records
Tiers : Tier 1-2