Supply chain due diligence legislation in Germany: General overview
As of 2025, Germany is the latest country in Europe to adopt a standalone law on corporate supply chain due diligence. Germany is Viet Nam’s second-largest export market in the EU (after the Netherlands), with many importers being large enterprises. Therefore, Germany’s supply chain due diligence regulations may have significant impacts on Vietnamese enterprises participating in the supply of goods and services to this market.
The Act on Corporate Due Diligence Obligations in Supply Chains (SCDDA, in German: Lieferkettensorgfaltspflichtengesetz – LkSG) was passed by the German Bundestag in July 2021 and came into effect on January 1, 2023.
In terms of content, the SCDDA is built upon the framework principles of the UN Guiding Principles on Business and Human Rights (UNGP) and the OECD Due Diligence Guidance (see Chapter I), aiming to establish a mandatory legal framework for regulated enterprises regarding the protection of human rights and environment-related issues connected to human rights throughout their supply chains.
In terms of legal effect, the SCDDA has been in force in Germany since January 1, 2023 (except for certain provisions on the management responsibility of competent authorities, which came into effect immediately upon the law’s publication).
In September 2025, Germany passed amendments to the SCDDA to reduce some obligations (including removing the reporting obligation and limiting sanctions for serious violations). The purpose of these amendments is considered to reduce the compliance burden for German enterprises while awaiting replacement by a new law aligned with the relevant EU Directive. The amendments are applied retroactively from the law’s effective date (i.e., January 1, 2023).
The law is expected to cease to be effective once Germany officially enacts domestic legislation implementing the relevant EU Directive.
Source: Compiled by the TTWTO-VCCI Research Group