German small and medium enterprises (SMEs) are grappling with compliance costs and bureaucratic hurdles imposed by the Supply Chain Act, hindering their global competitiveness. The law requires firms to monitor suppliers’ human rights and environmental practices, posing significant challenges for companies with complex supply chains like BAUCH. Meanwhile, the European Parliament passed a similar directive, further complicating matters for EU-based companies. While supporters argue it promotes responsible corporate behavior, critics fear excessive bureaucracy and burden on businesses. German manufacturers warn of increased costs and weakened competitiveness, especially against non-European competitors. Compliance costs are estimated to be high, with smaller enterprises indirectly affected by the law.
German SMEs Struggle with Supply Chain Regulations, EU Directive Adds Pressure
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