Minister of Economic Affairs Martin Kocher (ÖVP) has now commented on the vote on the EU supply chain law on Friday. He would abstain, it was announced on Wednesday afternoon. The current design cannot be implemented.
It also has a negative impact on companies in the EU and also on companies in the global south (e.g. countries in Africa and Latin America). Many obligations and liability risks would be shifted to small and medium-sized companies. “The Austrian economy consists of 99.6 percent of small and medium-sized businesses. There is a risk that small and medium-sized businesses worldwide will be pushed out of international supply chains.”
At the same time, Kocher made it clear: “We support the directive and want an implementable basis.” He would therefore argue for a return to the negotiating table to achieve improvements in the text. Concrete suggestions for this already exist.
Germany also wants to abstain
It is possible that the German government was a role model and also wants to abstain. Since then, several other EU countries have considered this. A majority is required to pass the law. The Supply Chain Act is intended to hold large companies liable if they benefit from child and forced labor outside the EU. In addition, large companies must develop a plan to achieve the Paris climate goals.
Kocher’s position has now been endorsed by the Austrian Chamber of Commerce and the Association of Industrialists. “From the perspective of the WKÖ and the IV, the EU Council has an immature directive that only creates uncertainty for companies and presents itself as a bureaucratic monster (…),” it says, for example, in a joint press release.
The local companies are already known internationally for their high ethical and social standards. However, for small businesses it is not possible to check “whether a supplier of a supplier in the supply chain is in breach of the requirements of the directive.”
Disagreement with coalition partner
As reported, Justice Minister Alma Zadic, numerous environmental organizations, NGOs and other political actors had previously campaigned for the EU supply chain law and Kocher’s approval. “With a strong supply chain law, we can finally take effective action against the exploitation of millions of children,” Zadic said. The Chamber of Labor sees little administrative effort. Catholic bishops also called for approval.
Source: Krone

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