After blocking signals from Italy, Austria and Germany forced them to waive a key vote on Friday (8 March), Belgian diplomats and technical staff from the European Commission are adding language, in the CSDDD text, spelling out that SMEs will not be negatively impacted by the law.

Additional reassurance being considered includes a ‘joint political statement’ by co-legislators as well as a future review by the EU executive of the potential impacts of the law on smaller businesses – which could entail input from Commissioner Thierry Breton’s Growth unit.

The amendments to the CSDDD – the law that looks to step up companies’ accountability for potential labour, human and environmental violations across their supply chain – are being tested with member states ahead of a more formal vote poll among envoys from the bloc’s 27 countries, which was originally rescheduled on their agenda for Wednesday. 

Two sources close to the matter, however, told Euractiv discussions will most likely carry on until Friday, when a separate vote on packaging measures is also taking place...

[S]ome national criticism had shifted to the indirect burden that smaller companies would have to shoulder in their role as business partners of larger businesses across the supply chain. On this point as well, though, those in support of the law have pointed out that the text of the Directive would provide guarantees that weren’t in place before the proposal...

The Business and Human Rights Resource Centre – a group that tracks companies’ labour and environmental practices – highlighted that, among others, in-scope companies would for example be required to provide support and resources to their smaller suppliers to comply with due diligence, and would be called to guarantee fair contractual terms with them.

SME associations, including that of Italy (CNA) have also repeatedly spoken in favour of the CSDDD. In a joint statement sent to the Italian government on Thursday and seen by Euractiv, a group of 21 signatories including CNA ramped up their calls to stop blocking the EU law.

“Given Italy’s role in [CSDDD] negotiations, we are asking the Italian government to favour the progress of legislative work,” the letter read.

Oxfam’s Herman told Euractiv: “To use the SME argument at this stage is not credible. What is happening now is basically related to the impact on very large businesses,” he said...