EU forced-labor product ban: challenges in tracing supply chains back to the raw-material stage

The European Commission explained at a briefing that the regulation would begin applying on 14 December 2027 and would ban the sale in the EU market of products made with forced labor, as well as their export from the EU. The rules apply regardless of company size, and information on supply chains and production sites, transaction and logistics records, working conditions and other matters may be requested during investigations into suspected violations.

EURATEX, the European textile industry association, pointed to the multilayered and geographically dispersed nature of supply chains. It explained that information is difficult to obtain from upstream companies with which there is no direct contractual relationship, and that information may be lost or become inconsistent as goods pass through multiple companies. Raw materials such as cotton are mixed and consolidated at an early stage, while changes among subcontractors also make it difficult to verify actual conditions.

It was noted that even documentation tracing the flow of raw materials does not directly prove working conditions. Small and medium-sized enterprises face the cost of analyzing sourcing regions and limits to their bargaining power with business partners. Calls were made not to automatically conclude that companies have refused to cooperate with an investigation or that forced labor is involved solely because upstream information is unavailable.

EuroCommerce, an association representing retailers and wholesalers, called for measures focused on countries, materials and production processes with a high risk of forced labor. While the regulation itself is explained not to impose new due diligence obligations, the view was expressed that ensuring supply-chain transparency will be important in practice.