### (49) the commission and member states should continue to work in partnership with third countries to support upstream economic operators build the capacity to effectively prevent and mitigate adverse human rights and environmental impacts of their operations and business relationships , paying specific attention to the challenges faced by smallholders. they should use their neighbourhood , development and international cooperation instruments to support third country governments and upstream economic operators in third countries addressing adverse human rights and environmental impacts of their operations and upstream business relationships. this could include working with partner country governments , the local private sector and stakeholders on addressing the root causes of adverse human rights and environmental impacts. ### (49) the commission and member states should continue to work in partnership with third countries to support upstream economic operators build the capacity to effectively prevent and mitigate adverse human rights and environmental impacts of their operations and business relationships , paying specific attention to the challenges faced by smallholders. they should use their neighbourhood , development , trade and international cooperation instruments to support third country governments and upstream economic operators in third countries addressing adverse human rights and environmental impacts of their operations and upstream business relationships , including through capacity building and expertise that will facilitate companies falling within the scope of this directive to comply with their due diligence obligations. this could include working with partner country governments , the local private sector and stakeholders , including civil society organizations and human rights defenders , on addressing the root causes of adverse human rights and environmental impacts. in the same line , the commission and member states should provide targeted support to stakeholders in third countries , in order to ensure a meaningful and safe engagement in all due diligence processes. in particular , support should be provided to national and local civil society organisations and human rights defenders to monitor corporate practices and hold companies accountable. the commission should also consider specific support programs for human rights defenders at risk because of their monitoring of corporate activities , particularly environmental defenders. in addition , the commission and member states should increase their dialogue with third countries in order to contribute to the enabling of environments in which the risks of retaliation is minimized.


### (50) in order to ensure that this directive effectively contributes to combating climate change , companies should adopt a plan to ensure that the business model and strategy of the company are compatible with the transition to a sustainable economy and with the limiting of global warming to 1.5 °c in line with the paris agreement. in case climate is or should have been identified as a principal risk for or a principal impact of the company’s operations , the company should include emissions reduction objectives in its plan. ### (50) in order to ensure that this directive effectively contributes to combating climate change , companies should adopt a plan to ensure that the business model and strategy of the company are compatible with the transition to a sustainable economy and with the limiting of global warming to 1.5 °c in line with the paris agreement and the objective of achieving climate neutrality by 2050 as established in the eu climate law as well as , where relevant , its exposure to coal- , oil- and gas-related activities. in case climate is or should have been identified as a principal risk for or a principal impact of the company’s operations , the company should include emissions reduction objectives in its plan.


### (56) in order to ensure effective compensation of victims of adverse impacts , member states should be required to lay down rules governing the civil liability of companies for damages arising due to its failure to comply with the due diligence process. the company should be liable for damages if they failed to comply with the obligations to prevent and mitigate potential adverse impacts or to bring actual impacts to an end and minimise their extent , and as a result of this failure an adverse impact that should have been identified , prevented , mitigated , brought to an end or its extent minimised through the appropriate measures occurred and led to damage. ### (56) in order to ensure effective compensation of victims of adverse impacts , member states should be required to lay down rules governing the civil liability of companies for damages arising due to its failure to comply with the due diligence process. the company should be liable for damages if they failed to comply with the obligations to prevent , prioritise and mitigate potential adverse impacts or to bring actual impacts to an end and minimise their extent , and as a result of this failure an adverse impact that should have been identified , prioritised , prevented , mitigated , brought to an end or its extent minimised through the appropriate measures occurred and led to damage. nonetheless , in cases where , as a consequence of the duty of prioritisation , the severe adverse impact arises from a lower prioritised adverse impact that was not yet addressed , the company should not be held liable , always provided that the prioritisation was adequate according to the severity , urgency and the likelihood of the adverse impacts.


### (57) as regards damages occurring at the level of established indirect business relationships , the liability of the company should be subject to specific conditions. the company should not be liable if it carried out specific due diligence measures. however , it should not be exonerated from liability through implementing such measures in case it was unreasonable to expect that the action actually taken , including as regards verifying compliance , would be adequate to prevent , mitigate , bring to an end or minimise the adverse impact. in addition , in the assessment of the existence and extent of liability , due account is to be taken of the company’s efforts , insofar as they relate directly to the damage in question , to comply with any remedial action required of them by a supervisory authority , any investments made and any targeted support provided as well as any collaboration with other entities to address adverse impacts in its value chains. ### (57) as regards damages occurring at the level of established indirect business relationships , the liability of the company should be subject to specific conditions. the company should not be liable if it carried out specific due diligence measures. however , it should not be exonerated from liability through implementing such measures in case it was unreasonable to expect that the action actually taken , including as regards verifying compliance , would be adequate to prevent , mitigate , bring to an end or minimise the adverse impact. in addition , in the assessment of the existence and extent of liability , due account is to be taken of the company’s efforts , insofar as they relate directly to the damage in question , to comply with any remedial action required of them by a supervisory authority , any investments made and any targeted support provided as well as any collaboration with other entities to address adverse impacts in its supply chains.


### (57) as regards damages occurring at the level of established indirect business relationships , the liability of the company should be subject to specific conditions. the company should not be liable if it carried out specific due diligence measures. however , it should not be exonerated from liability through implementing such measures in case it was unreasonable to expect that the action actually taken , including as regards verifying compliance , would be adequate to prevent , mitigate , bring to an end or minimise the adverse impact. in addition , in the assessment of the existence and extent of liability , due account is to be taken of the company’s efforts , insofar as they relate directly to the damage in question , to comply with any remedial action required of them by a supervisory authority , any investments made and any targeted support provided as well as any collaboration with other entities to address adverse impacts in its value chains. ### (57) as regards damages occurring at the level of monitored indirect business relationships , the liability of the company should be subject to specific conditions. the company should not be liable if it carried out specific due diligence measures. however , it should not be exonerated from liability through implementing such measures in case it was unreasonable to expect that the action actually taken , including as regards verifying compliance , would be adequate to prevent , mitigate , bring to an end or minimise the adverse impact. in addition , in the assessment of the existence and extent of liability , due account is to be taken of the company’s efforts , insofar as they relate directly to the damage in question , to comply with any remedial action required of them by a supervisory authority , any investments made and any targeted support provided as well as any collaboration with other entities to address adverse impacts in its value chains.


### (58) the liability regime does not regulate who should prove that the company’s action was reasonably adequate under the circumstances of the case , therefore this question is left to national law. ### deleted


### (58) the liability regime does not regulate who should prove that the company’s action was reasonably adequate under the circumstances of the case , therefore this question is left to national law. ### (58) member states shall take the necessary measures , in accordance with their national judicial systems , to ensure that , where persons who consider themselves wronged by failure to apply due diligence responsibilities establish , before a court or other competent body , facts from which it may be presumed that there has been a direct or indirect breach of the due diligence responsibilities , it shall be for the respondent to prove that the company’s action was adequate under the circumstances of the case.


### (59) as regards civil liability rules , the civil liability of a company for damages arising due to its failure to carry out adequate due diligence should be without prejudice to civil liability of its subsidiaries or the respective civil liability of direct and indirect business partners in the value chain. also , the civil liability rules under this directive should be without prejudice to union or national rules on civil liability related to adverse human rights impacts or to adverse environmental impacts that provide for liability in situations not covered by or providing for stricter liability than this directive. ### (59) as regards civil liability rules , the civil liability of a company for damages arising due to its failure to carry out adequate due diligence should be without prejudice to civil liability of its subsidiaries or the respective civil liability of direct and indirect business partners in the supply chain. also , the civil liability rules under this directive should be without prejudice to union or national rules on civil liability related to adverse human rights impacts or to adverse environmental impacts that provide for liability in situations not covered by or providing for stricter liability than this directive.


### (71) the objective of this directive , namely better exploiting the potential of the single market to contribute to the transition to a sustainable economy and contributing to sustainable development through the prevention and mitigation of potential or actual human rights and environmental adverse impacts in companies’ value chains , cannot be sufficiently achieved by the member states acting individually or in an uncoordinated manner , but can rather , by reason of the scale and effects of the actions , be better achieved at union level. in particular , addressed problems and their causes are of a transnational dimension , as many companies are operating union wide or globally and value chains expand to other member states and to third countries. moreover , individual member states’ measures risk being ineffective and lead to fragmentation of the internal market. therefore , the union may adopt measures , in accordance with the principle of subsidiarity as set out in article 5 teu. in accordance with the principle of proportionality , as set out in that article , this directive does not go beyond what is necessary in order to achieve that objective. ### (71) the objective of this directive , namely better exploiting the potential of the single market to contribute to the transition to a sustainable economy and contributing to sustainable development through the prevention and mitigation of potential or actual human rights and environmental adverse impacts in companies’ supply chains , cannot be sufficiently achieved by the member states acting individually or in an uncoordinated manner , but can rather , by reason of the scale and effects of the actions , be better achieved at union level. in particular , addressed problems and their causes are of a transnational dimension , as many companies are operating union wide or globally and supply chains expand to other member states and to third countries. moreover , individual member states’ measures risk being ineffective and lead to fragmentation of the internal market. therefore , the union may adopt measures , in accordance with the principle of subsidiarity as set out in article 5 teu. in accordance with the principle of proportionality , as set out in that article , this directive does not go beyond what is necessary in order to achieve that objective.


### (71) the objective of this directive , namely better exploiting the potential of the single market to contribute to the transition to a sustainable economy and contributing to sustainable development through the prevention and mitigation of potential or actual human rights and environmental adverse impacts in companies’ value chains , cannot be sufficiently achieved by the member states acting individually or in an uncoordinated manner , but can rather , by reason of the scale and effects of the actions , be better achieved at union level. in particular , addressed problems and their causes are of a transnational dimension , as many companies are operating union wide or globally and value chains expand to other member states and to third countries. moreover , individual member states’ measures risk being ineffective and lead to fragmentation of the internal market. therefore , the union may adopt measures , in accordance with the principle of subsidiarity as set out in article 5 teu. in accordance with the principle of proportionality , as set out in that article , this directive does not go beyond what is necessary in order to achieve that objective. ### (71) the objective of this directive , namely better exploiting the potential of the single market to contribute to the transition to a sustainable economy and contributing to sustainable development through the prevention and mitigation of potential or actual human rights and environmental adverse impacts in companies’ supply chains , cannot be sufficiently achieved by the member states acting individually or in an uncoordinated manner , but can rather , by reason of the scale and effects of the actions , be better achieved at union level. in particular , addressed problems and their causes are of a transnational dimension , as many companies are operating union wide or globally and value chains expand to other member states and to third countries. moreover , individual member states’ measures risk being ineffective and lead to fragmentation of the internal market. therefore , the union may adopt measures , in accordance with the principle of subsidiarity as set out in article 5 teu. in accordance with the principle of proportionality , as set out in that article , this directive does not go beyond what is necessary in order to achieve that objective.


### (71) the objective of this directive , namely better exploiting the potential of the single market to contribute to the transition to a sustainable economy and contributing to sustainable development through the prevention and mitigation of potential or actual human rights and environmental adverse impacts in companies’ value chains , cannot be sufficiently achieved by the member states acting individually or in an uncoordinated manner , but can rather , by reason of the scale and effects of the actions , be better achieved at union level. in particular , addressed problems and their causes are of a transnational dimension , as many companies are operating union wide or globally and value chains expand to other member states and to third countries. moreover , individual member states’ measures risk being ineffective and lead to fragmentation of the internal market. therefore , the union may adopt measures , in accordance with the principle of subsidiarity as set out in article 5 teu. in accordance with the principle of proportionality , as set out in that article , this directive does not go beyond what is necessary in order to achieve that objective. ### (71) the objective of this directive , namely better exploiting the potential of the single market to contribute to the transition to a sustainable economy and contributing to sustainable development through the prevention , mitigation and remediation of potential or actual human rights and environmental adverse impacts in companies’ value chains , cannot be sufficiently achieved by the member states acting individually or in an uncoordinated manner , but can rather , by reason of the scale and effects of the actions , be better achieved at union level. in particular , addressed problems and their causes are of a transnational dimension , as many companies are operating union wide or globally and value chains expand to other member states and to third countries. moreover , individual member states’ measures risk being ineffective and lead to fragmentation of the internal market. therefore , the union may adopt measures , in accordance with the principle of subsidiarity as set out in article 5 teu. in accordance with the principle of proportionality , as set out in that article , this directive does not go beyond what is necessary in order to achieve that objective.


### on obligations for companies regarding actual and potential human rights adverse impacts and environmental adverse impacts , with respect to their own operations , the operations of their subsidiaries , and the value chain operations carried out by entities with whom the company has an established business relationship and ### on obligations for companies regarding actual and potential human rights adverse impacts and environmental adverse impacts , with respect to their own operations , the operations of their subsidiaries , and the supply chain operations carried out by entities with whom the company has an established business relationship and


### the nature of business relationships as ‘established’ shall be reassessed periodically , and at least every 12 months. ### the nature of business relationships as ‘established’ shall be reassessed at least every 12 months.


### the nature of business relationships as ‘established’ shall be reassessed periodically , and at least every 12 months. ### deleted


### the company had more than 500 employees on average and had a net worldwide turnover of more than eur 150 million in the last financial year for which annual financial statements have been prepared; ### the company had more than 1000 employees on average and had a net worldwide turnover of more than eur 300 million in the last financial year for which annual financial statements have been prepared;


### the company did not reach the thresholds under point (a) , but had more than 250 employees on average and had a net worldwide turnover of more than eur 40 million in the last financial year for which annual financial statements have been prepared , provided that at least 50% of this net turnover was generated in one or more of the following sectors: ### the company did not reach the thresholds under point (a) , but had more than 250 employees on average worldwide and had a net worldwide turnover of more than eur 40 million in the last financial year for which annual financial statements have been prepared , provided that at least 50% of this net turnover was generated in one or more of the following sectors:


### (iii) the extraction of mineral resources regardless from where they are extracted (including crude petroleum , natural gas , coal , lignite , metals and metal ores , as well as all other , non-metallic minerals and quarry products) , the manufacture of basic metal products , other non-metallic mineral products and fabricated metal products (except machinery and equipment) , and the wholesale trade of mineral resources , basic and intermediate mineral products (including metals and metal ores , construction materials , fuels , chemicals and other intermediate products). ### (iii) energy , the extraction , transport and handling of mineral resources regardless from where they are extracted (including crude petroleum , natural gas , coal , lignite , metals and metal ores , as well as all other , non-metallic minerals and quarry products) , the manufacture of basic metal products , other non-metallic mineral products and fabricated metal products (except machinery and equipment) , and the wholesale trade of mineral resources , basic and intermediate mineral products (including metals and metal ores , construction materials , fuels , chemicals and other intermediate products).


### (iii) the extraction of mineral resources regardless from where they are extracted (including crude petroleum , natural gas , coal , lignite , metals and metal ores , as well as all other , non-metallic minerals and quarry products) , the manufacture of basic metal products , other non-metallic mineral products and fabricated metal products (except machinery and equipment) , and the wholesale trade of mineral resources , basic and intermediate mineral products (including metals and metal ores , construction materials , fuels , chemicals and other intermediate products). ### (iii) the extraction of mineral resources regardless from where they are extracted (including crude petroleum , natural gas , coal , lignite , metals and metal ores , as well as all other , non-metallic minerals and quarry products) , the manufacture of basic metal products , other non-metallic mineral products and fabricated metal products (except machinery and equipment) , the manufacture of computer , electronic and optical products , the manufacture of electrical equipment , and the wholesale trade of mineral resources , basic and intermediate mineral products (including metals and metal ores , construction materials , fuels , chemicals and other intermediate products)


### (iii) the extraction of mineral resources regardless from where they are extracted (including crude petroleum , natural gas , coal , lignite , metals and metal ores , as well as all other , non-metallic minerals and quarry products) , the manufacture of basic metal products , other non-metallic mineral products and fabricated metal products (except machinery and equipment) , and the wholesale trade of mineral resources , basic and intermediate mineral products (including metals and metal ores , construction materials , fuels , chemicals and other intermediate products). ### (iii) the extraction , transport and handling of mineral resources regardless from where they are extracted (including crude petroleum , natural gas , coal , lignite , metals and metal ores , as well as all other , non-metallic minerals and quarry products) , the manufacture of basic metal products , other non-metallic mineral products and fabricated metal products (except machinery and equipment) , the manufacture of computer , electronic and optical products and the wholesale trade of mineral resources , basic and intermediate mineral products (including metals and metal ores , construction materials , fuels , chemicals and other intermediate products).


### generated a net turnover of more than eur 150 million in the union in the financial year preceding the last financial year; ### generated a net turnover of more than eur 150 million worldwide in the financial year preceding the last financial year;


### generated a net turnover of more than eur 40 million but not more than eur 150 million in the union in the financial year preceding the last financial year , provided that at least 50% of its net worldwide turnover was generated in one or more of the sectors listed in paragraph 1 , point (b). ### generated a net turnover of more than eur 40 million but not more than eur 150 million worldwide in the financial year preceding the last financial year , provided that at least 50% of its net worldwide turnover was generated in one or more of the sectors listed in paragraph 1 , point (b).


### ‘adverse environmental impact’ means an adverse impact on the environment resulting from the violation of one of the prohibitions and obligations pursuant to the international environmental conventions listed in the annex , part ii; ### ‘adverse environmental impact’ means


### ‘adverse human rights impact’ means an adverse impact on protected persons resulting from the violation of one of the rights or prohibitions listed in the annex , part i section 1 , as enshrined in the international conventions listed in the annex , part i section 2; ### ‘adverse human rights impact’ means an adverse impact on protected persons resulting from the violation of one of the rights or prohibitions listed in the annex , part i section 1 , as enshrined in the international conventions listed in the annex , part i section 2 , that annex shall be reviewed on a regular basis and be consistent with the union’s objectives on human rights. the commission is empowered to adopt delegated acts in accordance with article 17 , to amend the list in annex i , section 1;


### ‘established business relationship’ means a business relationship , whether direct or indirect , which is , or which is expected to be lasting , in view of its intensity or duration and which does not represent a negligible or merely ancillary part of the value chain; ### ‘established business relationship’ means a direct business relationship which is , or which is expected to be lasting , in view of its intensity or duration and which does not represent a negligible or merely ancillary part of the supply chain;


### ‘established business relationship’ means a business relationship , whether direct or indirect , which is , or which is expected to be lasting , in view of its intensity or duration and which does not represent a negligible or merely ancillary part of the value chain; ### deleted


### ‘value chain’ means activities related to the production of goods or the provision of services by a company , including the development of the product or the service and the use and disposal of the product as well as the related activities of upstream and downstream established business relationships of the company. as regards companies within the meaning of point (a)(iv) , ‘value chain’ with respect to the provision of these specific services shall only include the activities of the clients receiving such loan , credit , and other financial services and of other companies belonging to the same group whose activities are linked to the contract in question. the value chain of such regulated financial undertakings does not cover smes receiving loan , credit , financing , insurance or reinsurance of such entities; ### ‘supply chain’ means activities related to the production of goods or the provision of services by a company as well as the related activities of established business partners of the company. as regards companies within the meaning of point (a)(iv) , ‘supply chain’ with respect to the provision of these specific services shall only include the activities of the clients receiving such loan , credit , and other financial services and of other companies belonging to the same group whose activities are linked to the contract in question. the supply chain of such regulated financial undertakings does not cover smes receiving loan , credit , financing , insurance or reinsurance of such entities;


### ‘value chain’ means activities related to the production of goods or the provision of services by a company , including the development of the product or the service and the use and disposal of the product as well as the related activities of upstream and downstream established business relationships of the company. as regards companies within the meaning of point (a)(iv) , ‘value chain’ with respect to the provision of these specific services shall only include the activities of the clients receiving such loan , credit , and other financial services and of other companies belonging to the same group whose activities are linked to the contract in question. the value chain of such regulated financial undertakings does not cover smes receiving loan , credit , financing , insurance or reinsurance of such entities; ### ‘supply chain’ means activities related to the production of goods or the provision of services by a company , including the development of the product or the service as well as the related activities of upstream established business relationships of the company. as regards companies within the meaning of point (a)(iv) , ‘supply chain’ with respect to the provision of these specific services shall only include the activities of the clients receiving such loan , credit , and other financial services and of other companies belonging to the same group whose activities are linked to the contract in question. the supply chain of such regulated financial undertakings does not cover smes receiving loan , credit , financing , insurance or reinsurance of such entities;


### ‘value chain’ means activities related to the production of goods or the provision of services by a company , including the development of the product or the service and the use and disposal of the product as well as the related activities of upstream and downstream established business relationships of the company. as regards companies within the meaning of point (a)(iv) , ‘value chain’ with respect to the provision of these specific services shall only include the activities of the clients receiving such loan , credit , and other financial services and of other companies belonging to the same group whose activities are linked to the contract in question. the value chain of such regulated financial undertakings does not cover smes receiving loan , credit , financing , insurance or reinsurance of such entities; ### deleted


### ‘value chain’ means activities related to the production of goods or the provision of services by a company , including the development of the product or the service and the use and disposal of the product as well as the related activities of upstream and downstream established business relationships of the company. as regards companies within the meaning of point (a)(iv) , ‘value chain’ with respect to the provision of these specific services shall only include the activities of the clients receiving such loan , credit , and other financial services and of other companies belonging to the same group whose activities are linked to the contract in question. the value chain of such regulated financial undertakings does not cover smes receiving loan , credit , financing , insurance or reinsurance of such entities; ### ‘supply chain’ means activities related to the production of goods or the provision of services by a company as well as the related activities of established business partners of the company. as regards companies within the meaning of point (a)(iv) , ‘supply chain’ with respect to the provision of these specific services shall only include the activities of the clients receiving such loan , credit , and other financial services and of other companies belonging to the same group whose activities are linked to the contract in question. the value chain of such regulated financial undertakings does not cover smes receiving loan , credit , financing , insurance or reinsurance of such entities;


### ‘value chain’ means activities related to the production of goods or the provision of services by a company , including the development of the product or the service and the use and disposal of the product as well as the related activities of upstream and downstream established business relationships of the company. as regards companies within the meaning of point (a)(iv) , ‘value chain’ with respect to the provision of these specific services shall only include the activities of the clients receiving such loan , credit , and other financial services and of other companies belonging to the same group whose activities are linked to the contract in question. the value chain of such regulated financial undertakings does not cover smes receiving loan , credit , financing , insurance or reinsurance of such entities; ### ‘supply chain’ means activities related to the production of goods or the provision of services by a company , including the development of the product or the service as well as the related activities of upstream established business relationships of the company. as regards companies within the meaning of point(a)(iv) , ‘supply chain’ with respect to the provision of the specific services shall only include the activities of the clients receiving such loan , credit , and other financial services and of other companies belonging to the same group whose activities are linked to the contract in question. the smes are not part of the supply chain thus exempted from obligations of this directive;


### ‘value chain’ means activities related to the production of goods or the provision of services by a company , including the development of the product or the service and the use and disposal of the product as well as the related activities of upstream and downstream established business relationships of the company. as regards companies within the meaning of point (a)(iv) , ‘value chain’ with respect to the provision of these specific services shall only include the activities of the clients receiving such loan , credit , and other financial services and of other companies belonging to the same group whose activities are linked to the contract in question. the value chain of such regulated financial undertakings does not cover smes receiving loan , credit , financing , insurance or reinsurance of such entities; ### ‘supply chain’ means activities related to the production of goods or the provision of services by a company , as well as the related activities established business partners of the company. as regards companies within the meaning of point (a)(iv) , ‘supply chain’ with respect to the provision of these specific services shall only include the activities of the clients receiving such loan , credit , and other financial services and of other companies belonging to the same group whose activities are linked to the contract in question. the value chain of such regulated financial undertakings does not cover smes receiving loan , credit , financing , insurance or reinsurance of such entities;


### ‘independent third-party verification’ means verification of the compliance by a company , or parts of its value chain , with human rights and environmental requirements resulting from the provisions of this directive by an auditor which is independent from the company , free from any conflicts of interests , has experience and competence in environmental and human rights matters and is accountable for the quality and reliability of the audit; ### ‘independent third-party verification’ means verification of the compliance by a company , or parts of its supply chain , with human rights and environmental requirements resulting from the provisions of this directive by an auditor which is independent from the company , free from any conflicts of interests , has experience and competence in environmental and human rights matters and is accountable for the quality and reliability of the audit;


### ‘authorised representative’ means a natural or legal person resident or established in the union who has a mandate from a company within the meaning of point (a)(ii) to act on its behalf in relation to compliance with that company’s obligations pursuant to this directive; ### ‘authorised representative’ means a natural or legal person resident or established in the union who has a written mandate from a company within the meaning of point (a)(ii) to act on its behalf in relation to compliance with that company’s obligations pursuant to this directive;


### ‘stakeholders’ means the company’s employees , the employees of its subsidiaries , and other individuals , groups , communities or entities whose rights or interests are or could be affected by the products , services and operations of that company , its subsidiaries and its business relationships; ### ‘stakeholders’ means the company’s employees , the employees of its subsidiaries , and other individuals , groups , communities or entities whose rights or interests are or could be directly affected by the products , services and operations of that company , its subsidiaries and its business relationships;


### ‘stakeholders’ means the company’s employees , the employees of its subsidiaries , and other individuals , groups , communities or entities whose rights or interests are or could be affected by the products , services and operations of that company , its subsidiaries and its business relationships; ### ‘stakeholders’ means the company’s workers and employees (including under informal arrangements) , the workers and employees of its subsidiaries (including under informal arrangements) , trade unions , consumers and end-users of products or services , civil society organisations , human rights and environmental defenders , witnesses and victims of corruption crimes perpetrated by the company , and other individuals , groups , communities or entities whose rights or interests are or could be affected by the products , services and operations of that company , its subsidiaries and its business relationships throughout the entire value chain; ‘vulnerable stakeholders’ means individuals or groups facing heightened risks of vulnerability or marginalisation , such as women , indigenous peoples , national or ethnic minorities , religious and linguistic minorities , children , persons with disabilities , and migrant workers and their families , in case of whom the adverse impact can be more severe or manifest differently , and who may need additional attention in the context of stakeholder engagement activities;


### ‘director’ means: ### deleted


### ‘board of directors’ means the administrative or supervisory body responsible for supervising the executive management of the company , or , if no such body exists , the person or persons performing equivalent functions; ### deleted


### ‘appropriate measure’ means a measure that is capable of achieving the objectives of due diligence , commensurate with the degree of severity and the likelihood of the adverse impact , and reasonably available to the company , taking into account the circumstances of the specific case , including characteristics of the economic sector and of the specific business relationship and the company’s influence thereof , and the need to ensure prioritisation of action. ### ‘appropriate measure’ means a measure that is capable of achieving the objectives of due diligence , commensurate with the degree of severity and the likelihood of the adverse impact , and reasonably available to the company after meaningful , proven and regular engagement and consultation with relevant stakeholders , taking into account the circumstances of the specific case , including characteristics of the economic sector and of the specific business relationship and the company’s influence thereof , and the need to ensure prioritisation of action.


### 1. member states shall ensure that companies integrate due diligence into all their corporate policies and have in place a due diligence policy. the due diligence policy shall contain all of the following: ### 1. member states shall ensure that companies develop meaningful , safe and regular engagement with stakeholders in accordance with article 11a , integrate due diligence into all their corporate policies and have in place a due diligence policy. the due diligence policy shall contain all of the following:


### a code of conduct describing rules and principles to be followed by the company’s employees and subsidiaries; ### a code of conduct describing rules and principles to be followed by the company’s employees and subsidiaries and established with the full engagement and relevant consultation with trade unions , civil society organizations , human rights defenders and other relevant stakeholders;


### 1. member states shall ensure that companies take appropriate measures to identify actual and potential adverse human rights impacts and adverse environmental impacts arising from their own operations or those of their subsidiaries and , where related to their value chains , from their established business relationships , in accordance with paragraph 2 , 3 and 4. ### 1. member states shall ensure that companies take appropriate measures to identify actual and potential adverse impacts arising from their own operations or those of their subsidiaries and , where related to their supply chains , those of their established business partners , in accordance with paragraph 2 , 3 and 4.


### 1. member states shall ensure that companies take appropriate measures to identify actual and potential adverse human rights impacts and adverse environmental impacts arising from their own operations or those of their subsidiaries and , where related to their value chains , from their established business relationships , in accordance with paragraph 2 , 3 and 4. ### 1. member states shall ensure that companies take appropriate measures to identify actual and potential adverse human rights impacts and adverse environmental impacts arising from their own operations or those of their subsidiaries and , where related to their supply chains , from their established business relationships , in accordance with paragraph 2 , 3 and 4.


### 1. member states shall ensure that companies take appropriate measures to identify actual and potential adverse human rights impacts and adverse environmental impacts arising from their own operations or those of their subsidiaries and , where related to their value chains , from their established business relationships , in accordance with paragraph 2 , 3 and 4. ### 1. member states shall ensure that companies take appropriate measures to identify and assess actual and potential adverse human rights and environmental impacts arising from their direct suppliers , in accordance with paragraph 2 , 3 and 4. where it is not feasible to identify and assess all adverse impacts simultaneously , companies shall prioritise in accordance with paragraph 2 and article 6a.


### 1. member states shall ensure that companies take appropriate measures to identify actual and potential adverse human rights impacts and adverse environmental impacts arising from their own operations or those of their subsidiaries and , where related to their value chains , from their established business relationships , in accordance with paragraph 2 , 3 and 4. ### 1. member states shall ensure that companies take appropriate measures to identify actual and potential adverse human rights impacts and actual and potential adverse environmental impacts arising from their own operations or those of their subsidiaries and , where related to their value chains , from their established business relationships , in accordance with paragraph 2 , 3 and 4.


### 2. by way of derogation from paragraph 1 , companies referred to in article 2(1) , point (b) , and article 2(2) , point (b) , shall only be required to identify actual and potential severe adverse impacts relevant to the respective sector mentioned in article 2(1) , point (b). ### 2. member states shall ensure that , for the purpose of compliance with paragraph 1 , companies shall take appropriate measures to:


### 3. when companies referred to in article 3 , point (a)(iv) , provide credit , loan or other financial services , identification of actual and potential adverse human rights impacts and adverse environmental impacts shall be carried out only before providing that service.. ### 3. when companies referred to in article 3 , point (a)(iv) , provide credit , loan or other financial services , identification of actual and potential adverse impacts shall be carried out only before providing that service..


### 3. when companies referred to in article 3 , point (a)(iv) , provide credit , loan or other financial services , identification of actual and potential adverse human rights impacts and adverse environmental impacts shall be carried out only before providing that service.. ### 3. when companies referred to in article 3 , point (a)(iv) , provide credit , loan or other financial services , identification of actual and potential impacts shall be carried out only before providing that service.


### 4. member states shall ensure that , for the purposes of identifying the adverse impacts referred to in paragraph 1 based on , where appropriate , quantitative and qualitative information , companies are entitled to make use of appropriate resources , including independent reports and information gathered through the complaints procedure provided for in article 9. companies shall , where relevant , also carry out consultations with potentially affected groups including workers and other relevant stakeholders to gather information on actual or potential adverse impacts. ### 4. member states shall ensure that , for the purposes of identifying and assessing the adverse impacts referred to in paragraph 1 based on , where appropriate , quantitative and qualitative information , companies are entitled to make use of appropriate resources , including independent reports and information gathered through the complaints procedure provided for in article 9. companies shall , where relevant , also carry out consultations with directly affected groups including workers and other relevant stakeholders to gather information on actual or potential adverse impacts.


### 4. member states shall ensure that , for the purposes of identifying the adverse impacts referred to in paragraph 1 based on , where appropriate , quantitative and qualitative information , companies are entitled to make use of appropriate resources , including independent reports and information gathered through the complaints procedure provided for in article 9. companies shall , where relevant , also carry out consultations with potentially affected groups including workers and other relevant stakeholders to gather information on actual or potential adverse impacts. ### 4. member states shall ensure that , for the purposes of identifying the actual and potential adverse impacts referred to in paragraph 1 based on , where appropriate , quantitative and qualitative information , companies are entitled to make use of appropriate resources , including independent reports and information gathered through the complaints procedure provided for in article 9. companies shall , where relevant , also carry out consultations with potentially affected groups including workers and other relevant stakeholders to gather information on actual or potential adverse impacts.


### 4. member states shall ensure that , for the purposes of identifying the adverse impacts referred to in paragraph 1 based on , where appropriate , quantitative and qualitative information , companies are entitled to make use of appropriate resources , including independent reports and information gathered through the complaints procedure provided for in article 9. companies shall , where relevant , also carry out consultations with potentially affected groups including workers and other relevant stakeholders to gather information on actual or potential adverse impacts. ### 4. member states shall ensure that , for the purposes of identifying the adverse impacts referred to in paragraph 1 based on , where appropriate , quantitative and qualitative information , companies are entitled to make use of appropriate resources , including independent reports and information gathered through the complaints procedure provided for in article 9. companies shall , where relevant , also carry out consultations with potentially affected groups including workers to gather information on actual or potential adverse impacts.


### 4. member states shall ensure that , for the purposes of identifying the adverse impacts referred to in paragraph 1 based on , where appropriate , quantitative and qualitative information , companies are entitled to make use of appropriate resources , including independent reports and information gathered through the complaints procedure provided for in article 9. companies shall , where relevant , also carry out consultations with potentially affected groups including workers and other relevant stakeholders to gather information on actual or potential adverse impacts. ### 4. member states shall ensure that , for the purposes of identifying the adverse impacts referred to in paragraph 1 based on quantitative and qualitative information , companies are entitled to make use of appropriate resources , including independent reports and information gathered through the complaints procedure provided for in article 9. companies shall carry out meaningful stakeholder engagement with potentially affected individuals and groups including workers and other relevant stakeholders to gather information on actual or potential adverse impacts , with due attention to identifying and removing the barriers of meaningful engagement faced by vulnerable stakeholders.


### where necessary due to the nature or complexity of the measures required for prevention , develop and implement a prevention action plan , with reasonable and clearly defined timelines for action and qualitative and quantitative indicators for measuring improvement. the prevention action plan shall be developed in consultation with affected stakeholders; ### where necessary due to the nature or complexity of the measures required for prevention , develop and implement a prevention action plan , with reasonable and clearly defined timelines for action and qualitative and quantitative indicators for measuring improvement. the prevention action plan shall be developed through meaningful stakeholder engagement , with due attention to vulnerable stakeholders , and draw on the expertise of civil society organisations;


### seek contractual assurances from a business partner with whom it has a direct business relationship that it will ensure compliance with the company’s code of conduct and , as necessary , a prevention action plan , including by seeking corresponding contractual assurances from its partners , to the extent that their activities are part of the company’s value chain (contractual cascading). when such contractual assurances are obtained , paragraph 4 shall apply; ### seek contractual assurances from a business partner with whom it has a direct business relationship that it will ensure compliance with the company’s code of conduct and , as necessary , a prevention action plan , including by seeking corresponding contractual assurances from its partners , to the extent that their activities are part of the company’s supply chain (contractual cascading). when such contractual assurances are obtained , paragraph 4 shall apply;


### provide targeted and proportionate support for an sme with which the company has an established business relationship , where compliance with the code of conduct or the prevention action plan would jeopardise the viability of the sme; ### provide targeted and proportionate support for an sme which , despite being exempt , decides to comply with the obligations under this directive , and with which the company has an established business relationship , where compliance with the code of conduct or the prevention action plan would jeopardise the viability of the sme;


### as regards potential adverse impacts within the meaning of paragraph 1 that could not be prevented or adequately mitigated by the measures in paragraphs 2 , 3 and 4 , the company shall be required to refrain from entering into new or extending existing relations with the partner in connection with or in the value chain of which the impact has arisen and shall , where the law governing their relations so entitles them to , take the following actions: ### as regards potential adverse impacts within the meaning of paragraph 1 that could not be prevented or adequately mitigated by the measures in paragraphs 2 , 3 and 4 , the company shall be required to refrain from entering into new or extending existing relations with the partner in connection with or in the supply chain of which the impact has arisen and shall , where the law governing their relations so entitles them to , take the following actions:


### neutralise the adverse impact or minimise its extent , including by the payment of damages to the affected persons and of financial compensation to the affected communities. the action shall be proportionate to the significance and scale of the adverse impact and to the contribution of the company’s conduct to the adverse impact; ### neutralise the adverse impact or minimise its extent , including by the payment of damages directly to the affected persons and of financial compensation directly to the affected communities , assessing whether women and vulnerable stakeholders benefit equitably in compensation payments or other forms of restitution. the action shall be proportionate to the significance and scale of the adverse impact and to the contribution of the company’s conduct to the adverse impact , and aim to restore the affected persons to the situation they would be in , had the adverse impact not occurred (if possible). the type of remedy or combination of remedies may include restitution or rehabilitation , apologies , financial or non-financial compensation , punitive sanctions , taking measures to prevent future adverse impacts;


### where necessary due to the fact that the adverse impact cannot be immediately brought to an end , develop and implement a corrective action plan with reasonable and clearly defined timelines for action and qualitative and quantitative indicators for measuring improvement. where relevant , the corrective action plan shall be developed in consultation with stakeholders; ### where necessary due to the fact that the adverse impact cannot be immediately brought to an end , develop and implement a corrective action plan with reasonable and clearly defined timelines for action and qualitative and quantitative indicators for measuring improvement. where relevant , the corrective action plan shall be developed in consultation with affected stakeholders;


### where necessary due to the fact that the adverse impact cannot be immediately brought to an end , develop and implement a corrective action plan with reasonable and clearly defined timelines for action and qualitative and quantitative indicators for measuring improvement. where relevant , the corrective action plan shall be developed in consultation with stakeholders; ### where necessary due to the fact that the adverse impact cannot be immediately brought to an end , develop and implement a corrective action plan with reasonable and clearly defined timelines for action and qualitative and quantitative indicators for measuring improvement. the corrective action plan shall be developed through the meaningful involvement of stakeholders , on an ongoing basis , with proper follow-through on implementation of agreed commitments;


### seek contractual assurances from a direct partner with whom it has an established business relationship that it will ensure compliance with the code of conduct and , as necessary , a corrective action plan , including by seeking corresponding contractual assurances from its partners , to the extent that they are part of the value chain (contractual cascading). when such contractual assurances are obtained , paragraph 5 shall apply. ### seek contractual assurances from a direct partner with whom it has an established business relationship that it will ensure compliance with the code of conduct and , as necessary , a corrective action plan , including by seeking corresponding contractual assurances from its partners , to the extent that they are part of the supply chain (contractual cascading). when such contractual assurances are obtained , paragraph 5 shall apply.


### provide targeted and proportionate support for an sme with which the company has an established business relationship , where compliance with the code of conduct or the corrective action plan would jeopardise the viability of the sme; ### provide targeted and proportionate support for an sme which , despite being exempt , decides to comply with the obligations under this directive and with which the company has an established business relationship , where compliance with the code of conduct or the corrective action plan would jeopardise the viability of the sme;


### provide targeted and proportionate support for an sme with which the company has an established business relationship , where compliance with the code of conduct or the corrective action plan would jeopardise the viability of the sme; ### provide targeted and proportionate support for an sme with which the company has a monitored business relationship , where compliance with the code of conduct or the corrective action plan would jeopardise the viability of the sme;


### as regards actual adverse impacts within the meaning of paragraph 1 that could not be brought to an end or the extent of which could not be minimised by the measures provided for in paragraphs 3 , 4 and 5 , the company shall refrain from entering into new or extending existing relations with the partner in connection to or in the value chain of which the impact has arisen and shall , where the law governing their relations so entitles them to , take one of the following actions: ### as regards actual adverse impacts within the meaning of paragraph 1 that could not be brought to an end or the extent of which could not be minimised by the measures provided for in paragraphs 3 , 4 and 5 , the company shall refrain from entering into new or extending existing relations with the partner in connection to or in the supply chain of which the impact has arisen and shall , where the law governing their relations so entitles them to , take one of the following actions:


### 1. member states shall ensure that companies provide the possibility for persons and organisations listed in paragraph 2 to submit complaints to them where they have legitimate concerns regarding actual or potential adverse human rights impacts and adverse environmental impacts with respect to their own operations , the operations of their subsidiaries and their value chains. ### 1. member states shall ensure that companies provide the possibility for persons and organisations listed in paragraph 2 to easily submit complaints to them where they have legitimate concerns regarding actual or potential adverse human rights impacts and adverse environmental impacts with respect to their own operations , the operations of their subsidiaries and their supply chains. the complaint must be factually justified and reasonably documented.


### 1. member states shall ensure that companies provide the possibility for persons and organisations listed in paragraph 2 to submit complaints to them where they have legitimate concerns regarding actual or potential adverse human rights impacts and adverse environmental impacts with respect to their own operations , the operations of their subsidiaries and their value chains. ### 1. member states shall ensure that companies provide the possibility for persons and organisations listed in paragraph 2 to submit complaints to them where they have legitimate indications regarding actual or potential adverse human rights impacts and adverse environmental impacts with respect to their own operations , the operations of their subsidiaries and their value chains. the complaint shall be factually justified and reasonably documented.


### 1. member states shall ensure that companies provide the possibility for persons and organisations listed in paragraph 2 to submit complaints to them where they have legitimate concerns regarding actual or potential adverse human rights impacts and adverse environmental impacts with respect to their own operations , the operations of their subsidiaries and their value chains. ### 1. member states shall ensure that companies provide the possibility for persons and organisations listed in paragraph 2 to submit complaints to them where they have legitimate indications regarding actual or potential adverse human rights impacts and adverse environmental impacts with respect to their own operations , the operations of their subsidiaries and their value chains. the complaint must be factually justified and reasonably documented.


### 1. member states shall ensure that companies provide the possibility for persons and organisations listed in paragraph 2 to submit complaints to them where they have legitimate concerns regarding actual or potential adverse human rights impacts and adverse environmental impacts with respect to their own operations , the operations of their subsidiaries and their value chains. ### 1. member states shall ensure that companies provide the possibility for persons and organisations listed in paragraph 2 to submit complaints to them where they have legitimate concerns regarding actual or potential adverse human rights impacts and adverse environmental impacts with respect to their own operations , the operations of their subsidiaries and their value chains. the complaint procedure shall provide for the possibility to raise complaints anonymously and confidentially , according to the directive (eu) 2019/1937 of the european parliament and of the council of 23 october 2019 on the protection of persons who report breaches of union law.


### persons who are affected or have reasonable grounds to believe that they might be affected by an adverse impact , ### persons who are directly affected or have reasonable grounds to believe that they will be affected by an adverse impact ,


### persons who are affected or have reasonable grounds to believe that they might be affected by an adverse impact , ### individuals , groups , communities or entities whose rights or interests are or could be affected by an adverse impact of the products , services and operations of that company , its subsidiaries and its business relationships throughout the entire value chain ,


### persons who are affected or have reasonable grounds to believe that they might be affected by an adverse impact , ### individuals , groups , communities or entities who are affected or have reasonable grounds to believe that they might be affected by an adverse impact ,


### trade unions and other workers’ representatives representing individuals working in the value chain concerned , ### trade unions and other workers’ representatives representing individuals working in the supply chain concerned ,


### trade unions and other workers’ representatives representing individuals working in the value chain concerned , ### trade unions and other workers’ representatives representing individuals working in the supply chain concerned which have legitimate concern ,


### civil society organisations active in the areas related to the value chain concerned. ### civil society organisations active in the areas related to the supply chain concerned.


### civil society organisations active in the areas related to the value chain concerned. ### deleted


### civil society organisations active in the areas related to the value chain concerned. ### civil society organisations , human rights and environmental defenders active in the areas related to the value chain concerned.


### civil society organisations active in the areas related to the value chain concerned. ### civil society organisations and human rights defenders active in the areas directly or indirectly related to the value chain concerned , including - inter alia- environmental defenders and victims and witnesses of corruption;


### to meet with the company’s representatives at an appropriate level to discuss potential or actual severe adverse impacts that are the subject matter of the complaint. ### deleted


### to meet with the company’s representatives at an appropriate level to discuss potential or actual severe adverse impacts that are the subject matter of the complaint. ### to meet with the company’s representatives at an appropriate level to discuss potential or actual severe adverse impacts that are the subject matter of the complaint , including guarantees of non-retaliation , confidentiality and anonymity when requested;.


### member states shall ensure that companies carry out periodic assessments of their own operations and measures , those of their subsidiaries and , where related to the value chains of the company , those of their established business relationships , to monitor the effectiveness of the identification , prevention , mitigation , bringing to an end and minimisation of the extent of human rights and environmental adverse impacts. such assessments shall be based , where appropriate , on qualitative and quantitative indicators and be carried out at least every 12 months and whenever there are reasonable grounds to believe that significant new risks of the occurrence of those adverse impacts may arise. the due diligence policy shall be updated in accordance with the outcome of those assessments. ### member states shall ensure that companies carry out periodic assessments of their own operations and measures , those of their subsidiaries and , where related to the supply chains of the company , those of their established business relationships , to monitor the effectiveness of the identification , prevention , mitigation , bringing to an end and minimisation of the extent of human rights and environmental adverse impacts. such assessments shall be based , where appropriate , on qualitative and quantitative indicators and be carried out at least every 12 months and whenever there are reasonable grounds to believe that significant new risks of the occurrence of those adverse impacts may arise. the due diligence policy shall be updated in accordance with the outcome of those assessments.


### member states shall ensure that companies carry out periodic assessments of their own operations and measures , those of their subsidiaries and , where related to the value chains of the company , those of their established business relationships , to monitor the effectiveness of the identification , prevention , mitigation , bringing to an end and minimisation of the extent of human rights and environmental adverse impacts. such assessments shall be based , where appropriate , on qualitative and quantitative indicators and be carried out at least every 12 months and whenever there are reasonable grounds to believe that significant new risks of the occurrence of those adverse impacts may arise. the due diligence policy shall be updated in accordance with the outcome of those assessments. ### member states shall ensure that companies carry out periodic assessments of their own operations and measures , those of their subsidiaries and , where related to the value chains of the company , those of their monitored business relationships , to monitor the effectiveness of the identification , prevention , mitigation , bringing to an end and minimisation of the extent of human rights and environmental adverse impacts. such assessments shall be based , where appropriate , on qualitative and quantitative indicators and be carried out at least every 12 months and whenever there are reasonable grounds to believe that significant new risks of the occurrence of those adverse impacts may arise. the due diligence policy shall be updated in accordance with the outcome of those assessments.


### in order to provide support to companies to facilitate their compliance with article 7(2) , point (b) , and article 8(3) , point (c) , the commission shall adopt guidance about voluntary model contract clauses. ### in order to provide support to companies to facilitate their compliance with article 7(2) , point (b) , and article 8(3) , point (c) , the commission shall adopt , within the twelve months prior to the application date of this directive , guidance about voluntary model contract clauses.


### in order to provide support to companies or to member state authorities on how companies should fulfil their due diligence obligations , the commission , in consultation with member states and stakeholders , the european union agency for fundamental rights , the european environment agency , and where appropriate with international bodies having expertise in due diligence , may issue guidelines , including for specific sectors or specific adverse impacts. ### in order to provide support to companies or to member state authorities on how companies should fulfil their due diligence obligations , the commission , in consultation with member states and stakeholders , the european union agency for fundamental rights , the european environment agency , and where appropriate with international bodies having expertise in due diligence , shall issue specific guidelines , including for specific sectors or specific adverse impacts. in particular , those guidelines shall facilitate the compliance of all companies with the obligations laid down in this directive , taking into account the need to simplify the administrative burden for smaller companies , to ensure a level playing field within the union and to ensure a consistent implementation of this directive.


### in order to provide support to companies or to member state authorities on how companies should fulfil their due diligence obligations , the commission , in consultation with member states and stakeholders , the european union agency for fundamental rights , the european environment agency , and where appropriate with international bodies having expertise in due diligence , may issue guidelines , including for specific sectors or specific adverse impacts. ### in order to provide support to companies or to member state authorities on how companies should fulfil their due diligence obligations , the commission shall issue guidelines , in consultation with member states , industry representatives , the european union agency for fundamental rights , the european environment agency , and where appropriate with international bodies having expertise in due diligence. the guidelines should include guidance for specific sectors as defined by nace codes , in accordance with article 2 and 28 , taking into account already existing sectoral schemes for due diligence.


### in order to provide support to companies or to member state authorities on how companies should fulfil their due diligence obligations , the commission , in consultation with member states and stakeholders , the european union agency for fundamental rights , the european environment agency , and where appropriate with international bodies having expertise in due diligence , may issue guidelines , including for specific sectors or specific adverse impacts. ### in order to provide support to companies or to member state authorities on how companies should fulfil their due diligence obligations , the commission , in consultation with member states and stakeholders , the european union agency for fundamental rights , the european environment agency , and where appropriate with international bodies having expertise in due diligence , shall , within the twelve months following the entry into force of this directive , issue guidelines , including for specific sectors or specific adverse impacts.


### in order to provide support to companies or to member state authorities on how companies should fulfil their due diligence obligations , the commission , in consultation with member states and stakeholders , the european union agency for fundamental rights , the european environment agency , and where appropriate with international bodies having expertise in due diligence , may issue guidelines , including for specific sectors or specific adverse impacts. ### in order to provide support to companies or to member state authorities on how companies should fulfil their due diligence obligations , the commission , in consultation with member states and stakeholders , the european union agency for fundamental rights , the european environment agency , and where appropriate with international bodies having expertise in due diligence , may issue guidelines , including for specific sectors or specific adverse impacts. given the importance of uniform implementation across member state authorities to ensure a level playing field , adherence to these guidelines should be monitored through the european semester for policy coordination , and potential shortcomings addressed in country-specific recommendations.


### 1. member states shall , in order to provide information and support to companies and the partners with whom they have established business relationships in their value chains in their efforts to fulfil the obligations resulting from this directive , set up and operate individually or jointly dedicated websites , platforms or portals. specific consideration shall be given , in that respect , to the smes that are present in the value chains of companies. ### 1. member states shall , in order to provide information and support to companies and the partners with whom they have established business relationships in their supply chains in their efforts to fulfil the obligations resulting from this directive , set up and operate individually or jointly dedicated websites , platforms or portals. specific consideration shall be given , in that respect , to the smes that are present in the supply chains of companies.


### 1. member states shall , in order to provide information and support to companies and the partners with whom they have established business relationships in their value chains in their efforts to fulfil the obligations resulting from this directive , set up and operate individually or jointly dedicated websites , platforms or portals. specific consideration shall be given , in that respect , to the smes that are present in the value chains of companies. ### 1. member states shall , in order to provide information and support to companies and the partners with whom they have monitored business relationships in their value chains in their efforts to fulfil the obligations resulting from this directive , set up and operate individually or jointly dedicated websites , platforms or portals. specific consideration shall be given , in that respect , to the smes that are present in the value chains of companies.


### 3. the commission may complement member states’ support measures building on existing union action to support due diligence in the union and in third countries and may devise new measures , including facilitation of joint stakeholder initiatives to help companies fulfil their obligations. ### 3. the commission may complement member states’ support measures building on existing union action to support due diligence in the union and in third countries and may devise new measures. this should include the facilitation of shared value partnerships as well as of joint stakeholder initiatives to help companies fulfil their obligations , but also a set of accompanying measures to partner countries- and particularly to developing countries- in order to contribute to the convergence , harmonisation and professionalisation of private standard schemes , metrics , monitoring and assessment systems , as well as accounting and reporting formats to ensure credible , gender-sensitive , reliable , actionable and comparable performance data on due diligence.


### 4. companies may rely on industry schemes and multi-stakeholder initiatives to support the implementation of their obligations referred to in articles 5 to 11 of this directive to the extent that such schemes and initiatives are appropriate to support the fulfilment of those obligations. the commission and the member states may facilitate the dissemination of information on such schemes or initiatives and their outcome. the commission , in collaboration with member states , may issue guidance for assessing the fitness of industry schemes and multi-stakeholder initiatives. ### 4. companies may rely on industry schemes and multi-stakeholder initiatives to support the implementation of their obligations referred to in articles 5 to 11 of this directive to the extent that such schemes and initiatives are appropriate to support the fulfilment of those obligations. the commission and the member states may facilitate the dissemination of information on such schemes or initiatives and their outcome. the commission , in collaboration with member states , shall issue guidance for assessing the fitness of industry schemes and multi-stakeholder initiatives.


### 1. member states shall ensure that companies referred to in article 2(1) , point (a) , and article 2(2) , point (a) , shall adopt a plan to ensure that the business model and strategy of the company are compatible with the transition to a sustainable economy and with the limiting of global warming to 1.5 °c in line with the paris agreement. this plan shall , in particular , identify , on the basis of information reasonably available to the company , the extent to which climate change is a risk for , or an impact of , the company’s operations. ### 1. member states shall ensure that companies referred to in article 2 , shall adopt a transition plan , whose disclosure is foreseen in regulation (eu) 2021/0104 (csrd) , that include the plans of the undertaking , including implementing actions and related financial and investment plans , to ensure that its business model and strategy are compatible with the transition to a sustainable economy and with the limiting of global warming to 1.5 °c in line with the paris agreement and the objective of achieving climate neutrality by 2050 as established in regulation (eu) 2021/1119 (european climate law) , and where relevant , the exposure of the undertaking to coal , oil and gas-related activities.


### 1. member states shall ensure that companies referred to in article 2(1) , point (a) , and article 2(2) , point (a) , shall adopt a plan to ensure that the business model and strategy of the company are compatible with the transition to a sustainable economy and with the limiting of global warming to 1.5 °c in line with the paris agreement. this plan shall , in particular , identify , on the basis of information reasonably available to the company , the extent to which climate change is a risk for , or an impact of , the company’s operations. ### 1. member states shall ensure that companies referred to in article 2 shall adopt a plan in line with directive 2021/010414a to ensure that the business model and strategy of the company are compatible with the transition to a sustainable economy and with the limiting of global warming to 1.5 °c in line with the paris agreement. this plan shall , in particular , identify , on the basis of information reasonably available to the company , the extent to which climate change is a risk for , or an impact of , the company’s operations.


### 1. member states shall ensure that companies referred to in article 2(1) , point (a) , and article 2(2) , point (a) , shall adopt a plan to ensure that the business model and strategy of the company are compatible with the transition to a sustainable economy and with the limiting of global warming to 1.5 °c in line with the paris agreement. this plan shall , in particular , identify , on the basis of information reasonably available to the company , the extent to which climate change is a risk for , or an impact of , the company’s operations. ### 1. member states shall ensure that companies referred to in article 2(1) , point (a) , and article 2(2) , point (a) , shall adopt a plan , including implementing actions and related financial and investments plans , to ensure that the business model and strategy of the company are compatible with the transition to a sustainable economy and with the limiting of global warming to 1.5 °c in line with the paris agreement and the objective of achieving climate neutrality by 2050 as established in regulation (eu) 2021/1119 and where relevant , the exposure of the group to coal- , oil- and gas-related activities. this plan shall , in particular , identify , on the basis of information reasonably available to the company , the extent to which climate change is a risk for , or an impact of , the company’s operations.


### 2. member states shall ensure that , in case climate change is or should have been identified as a principal risk for , or a principal impact of , the company’s operations , the company includes emission reduction objectives in its plan. ### deleted


### 3. member states shall ensure that companies duly take into account the fulfilment of the obligations referred to in paragraphs 1 and 2 when setting variable remuneration , if variable remuneration is linked to the contribution of a director to the company’s business strategy and long-term interests and sustainability. ### deleted


### 3. member states shall ensure that companies duly take into account the fulfilment of the obligations referred to in paragraphs 1 and 2 when setting variable remuneration , if variable remuneration is linked to the contribution of a director to the company’s business strategy and long-term interests and sustainability. ### 3. member states shall ensure that companies align at least 20% of directors’ variable remuneration with the achievement of their transition plans and in particular the climate targets and greenhouse gases emissions reduction;


### 4. member states shall ensure that each company empowers its authorised representative to receive communications from supervisory authorities on all matters necessary for compliance with and enforcement of national provisions transposing this directive. companies shall be required to provide their authorised representative with the necessary powers and resources to cooperate with supervisory authorities. ### 4. member states shall ensure that each company empowers its authorised representative to receive direct and swift communications from supervisory authorities on all matters necessary for compliance with and enforcement of national provisions transposing this directive. companies shall be required to provide their authorised representative with the necessary powers and resources to effectively cooperate with supervisory authorities.


### 1. member states shall lay down the rules on sanctions applicable to infringements of national provisions adopted pursuant to this directive , and shall take all measures necessary to ensure that they are implemented. the sanctions provided for shall be effective , proportionate and dissuasive. ### 1. member states shall lay down the rules on sanctions applicable to infringements of national provisions adopted pursuant to this directive , and shall take all measures necessary to ensure that they are implemented. the sanctions provided for shall be effective , proportionate and dissuasive. member states shall take in due account the exchange of information held within the european network of supervisory authority to ensure that sanctions are harmonised within the union;


### 2. in deciding whether to impose sanctions and , if so , in determining their nature and appropriate level , due account shall be taken of the company’s efforts to comply with any remedial action required of them by a supervisory authority , any investments made and any targeted support provided pursuant to articles 7 and 8 , as well as collaboration with other entities to address adverse impacts in its value chains , as the case may be. ### 2. in deciding whether to impose sanctions and , if so , in determining their nature and appropriate level , due account shall be taken of the company’s efforts to comply with any remedial action required of them by a supervisory authority , any investments made and any targeted support provided pursuant to articles 7 and 8 , possible cumulative effects from other sanctions already imposed on the company , as well as collaboration with other entities to address adverse impacts in its supply chains , as the case may be.


### the commission shall set up a european network of supervisory authorities , composed of representatives of the supervisory authorities. the network shall facilitate the cooperation of the supervisory authorities and the coordination and alignment of regulatory , investigative , sanctioning and supervisory practices of the supervisory authorities and , as appropriate , sharing of information among them. ### the commission shall set up a european network of supervisory authorities , composed of representatives of the supervisory authorities. the network shall serve as a platform to facilitate a structured cooperation of the supervisory authorities and the coordination and alignment of regulatory , investigative , sanctioning and supervisory practices of the supervisory authorities and , as appropriate , sharing of information among them. in particular , the network shall facilitate the development of a harmonised approach on sanctions applicable for infringements of this regulation , including by determining common range and common criteria for penalties.


### civil liability ### access to remedy


### 1. member states shall ensure that companies are liable for damages if: ### 1. member states shall ensure that a company is liable for damages to an injured person if:


### they failed to comply with the obligations laid down in articles 7 and 8 and; ### it intentionally or negligently failed to comply with an obligation laid down in articles 7 or 8 that has protective effect towards the injured person and;


### as a result of this failure an adverse impact that should have been identified , prevented , mitigated , brought to an end or its extent minimised through the appropriate measures laid down in articles 7 and 8 occurred and led to damage. ### as a result of this failure death , personal injury , restriction of personal liberty , or damage to or destruction of any item of property was caused.


### notwithstanding paragraph 1 , member states shall ensure that where a company has taken the actions referred to in article 7(2) , point (b) and article 7(4) , or article 8(3) , point (c) , and article 8(5) , it shall not be liable for damages caused by an adverse impact arising as a result of the activities of an indirect partner with whom it has an established business relationship , unless it was unreasonable , in the circumstances of the case , to expect that the action actually taken , including as regards verifying compliance , would be adequate to prevent , mitigate , bring to an end or minimise the extent of the adverse impact. ### a company shall only be liable in cases of intent or gross negligence if it has acceded to an industry or sector initiative and implemented a standard set by this initiative into its normal course of business and


### notwithstanding paragraph 1 , member states shall ensure that where a company has taken the actions referred to in article 7(2) , point (b) and article 7(4) , or article 8(3) , point (c) , and article 8(5) , it shall not be liable for damages caused by an adverse impact arising as a result of the activities of an indirect partner with whom it has an established business relationship , unless it was unreasonable , in the circumstances of the case , to expect that the action actually taken , including as regards verifying compliance , would be adequate to prevent , mitigate , bring to an end or minimise the extent of the adverse impact. ### deleted


### in the assessment of the existence and extent of liability under this paragraph , due account shall be taken of the company’s efforts , insofar as they relate directly to the damage in question , to comply with any remedial action required of them by a supervisory authority , any investments made and any targeted support provided pursuant to articles 7 and 8 , as well as any collaboration with other entities to address adverse impacts in its value chains. ### deleted


### in the assessment of the existence and extent of liability under this paragraph , due account shall be taken of the company’s efforts , insofar as they relate directly to the damage in question , to comply with any remedial action required of them by a supervisory authority , any investments made and any targeted support provided pursuant to articles 7 and 8 , as well as any collaboration with other entities to address adverse impacts in its value chains. ### in the assessment of the existence and extent of liability under this paragraph , due account shall be taken of the company’s efforts , insofar as they relate directly to the damage in question , to comply with any remedial action required of them by a supervisory authority , any investments made and any targeted support provided pursuant to articles 7 and 8 , as well as any collaboration with other entities to address adverse impacts in its supply chains.


### 3. the civil liability of a company for damages arising under this provision shall be without prejudice to the civil liability of its subsidiaries or of any direct and indirect business partners in the value chain. ### 3. a company shall also only be liable in cases of intent or gross negligence if it has obtained certification by an independent certification entity that it is regularly in full compliance with the obligations laid down in article 7 and 8 and


### 3. the civil liability of a company for damages arising under this provision shall be without prejudice to the civil liability of its subsidiaries or of any direct and indirect business partners in the value chain. ### 3. the civil liability of a company for damages arising under this provision shall be without prejudice to the civil liability of its subsidiaries or of any direct and indirect business partners in the supply chain.


### 3. the civil liability of a company for damages arising under this provision shall be without prejudice to the civil liability of its subsidiaries or of any direct and indirect business partners in the value chain. ### deleted


### 4. the civil liability rules under this directive shall be without prejudice to union or national rules on civil liability related to adverse human rights impacts or to adverse environmental impacts that provide for liability in situations not covered by or providing for stricter liability than this directive. ### 4. the civil liability of a company for damages arising under this provision shall be without prejudice to the civil liability of its subsidiaries or of any direct and indirect business partners in the value chain.


### 4. the civil liability rules under this directive shall be without prejudice to union or national rules on civil liability related to adverse human rights impacts or to adverse environmental impacts that provide for liability in situations not covered by or providing for stricter liability than this directive. ### deleted


### 5. member states shall ensure that the liability provided for in provisions of national law transposing this article is of overriding mandatory application in cases where the law applicable to claims to that effect is not the law of a member state. ### 5. no punitive damages shall be awarded under this provision. the calculation of damages and the general prerequisites and conditions of civil liability not provided for in this provision shall be governed by the substantive law of the respective member state. the civil liability under this provision shall be without prejudice to any applicable union or national liability that provides for liability in situations not covered by or providing for stricter liability than this directive.


### 5. member states shall ensure that the liability provided for in provisions of national law transposing this article is of overriding mandatory application in cases where the law applicable to claims to that effect is not the law of a member state. ### deleted


### article 25 ### deleted


### article 26 ### deleted


### 1. member states shall ensure that directors of companies referred to in article 2(1) are responsible for putting in place and overseeing the due diligence actions referred to in article 4 and in particular the due diligence policy referred to in article 5 , with due consideration for relevant input from stakeholders and civil society organisations. the directors shall report to the board of directors in that respect. ### 1. member states shall ensure that directors of companies referred to in article 2(1) are responsible for putting in place and overseeing the due diligence actions referred to in article 4 and in particular the due diligence policy referred to in article 5 and the implementing actions under article 15 , with due consideration for relevant input from stakeholders and civil society organisations. the directors shall report to the board of directors in that respect.


### 1. member states shall ensure that directors of companies referred to in article 2(1) are responsible for putting in place and overseeing the due diligence actions referred to in article 4 and in particular the due diligence policy referred to in article 5 , with due consideration for relevant input from stakeholders and civil society organisations. the directors shall report to the board of directors in that respect. ### 1. member states shall ensure that directors of companies referred to in article 2(1) are responsible for putting in place and overseeing the due diligence actions referred to in article 4 and in particular the due diligence policy referred to in article 5 , with mandatory , relevant , transparent and meaningful engagement and due consideration for relevant input from stakeholders and civil society organisations , including human rights defenders , trade unions and persons and groups of persons affected or with legitimate interests in the adverse impacts arising from operations carried out by the company , its subsidiaries or business partners in the value chain. the directors shall report to the board of directors in that respect.


### 2. member states shall ensure that directors take steps to adapt the corporate strategy to take into account the actual and potential adverse impacts identified pursuant to article 6 and any measures taken pursuant to articles 7 to 9. ### 2. member states shall ensure that directors take steps to adapt the corporate strategy to take into account the actual and potential adverse impacts identified pursuant to article 6 and any measures taken pursuant to articles 7 to 9 and article 15.


### whether the thresholds regarding the number of employees and net turnover laid down in article 2(1) need to be lowered; ### whether the thresholds regarding the number of employees and net turnover laid down in article 2(1) need to be lowered , while paying attention to tailored-made measures designed for the specific needs of these companies in view of an effective implementation of the directive;


### whether the thresholds regarding the number of employees and net turnover laid down in article 2(1) need to be lowered; ### whether the thresholds regarding the number of employees and net turnover laid down in article 2(1) need to be modified;


### (16) the due diligence process set out in this directive should cover the six steps defined by the oecd due diligence guidance for responsible business conduct , which include due diligence measures for companies to identify and address adverse human rights and environmental impacts. this encompasses the following steps: (1) integrating due diligence into policies and management systems , (2) identifying and assessing adverse human rights and environmental impacts , (3) preventing , ceasing or minimising actual and potential adverse human rights , and environmental impacts , (4) assessing the effectiveness of measures , (5) communicating , (6) providing remediation. ### (16) the due diligence process set out in this directive should cover the six steps defined by the oecd due diligence guidance for responsible business conduct , which include due diligence measures for companies to identify and address adverse human rights and environmental impacts. this encompasses the following steps: (1) integrating due diligence into policies and management systems , (2) identifying and assessing adverse human rights and environmental impacts , (3) preventing , ceasing or minimising actual and potential adverse human rights , and environmental impacts , (4) assessing the effectiveness of measures , (5) communicating , (6) providing remediation. the oecd due diligence guidance for responsible business conduct also includes detailed recommendations to ensure meaningful stakeholder involvement and access to justice , including guidance to remove barriers to engagement with vulnerable stakeholder groups.


### the manufacture of textiles , leather and related products (including footwear) , and the wholesale trade of textiles , clothing and footwear; ### the manufacture of textiles , fur , leather and related products (including footwear) , and the wholesale trade of textiles , clothing and footwear;


### the manufacture of textiles , leather and related products (including footwear) , and the wholesale trade of textiles , clothing and footwear; ### the manufacture of textiles , wearing apparel , leather and related products (including footwear) , and the wholesale trade of textiles , clothing and footwear;