ABSTRACT
It is evident that the CSDDD will have an immense impact on supply chains worldwide. Many large non-EU entities, including major US and Chinese companies such as ExxonMobil, General Motors, Coca Cola, Apple, Microsoft, BYD, SAIC, Haier, Baoshan Iron & Steel, China Petroleum, Sany Heavy Industry, will be directly bound by the CSDDD due to surpassing the CSDDD's turnover thresholds in the EU. However, most effective will not be the direct but the indirect impact of the CSDDD, reaching by means of contractual cascading countless EU and non-EU entities (including SMEs) being involved in EU-related supply chains. Importantly, the CSDDD requires directly bound companies to support SMEs when implementing the human rights and environmental due diligence mechanism. Countering concerns that large companies may use their bargaining and market power to pass on CSDDD-related obligations to lower-tier supply chain members, the CSDDD makes clear that companies directly covered by the CSDDD will remain responsible for the adoption and implementation of codes of conducts as well as prevention/corrective action plans and other appropriate measures.
