From Guidance to Enforcement

On June 30, the Commission published the Guidelines for the application of the Regulation (EU) 2024/3015 (Forced Labor Regulation) which prohibits products made with forced labour from being placed or made available on the EU market or exported from the EU. At the same time, it launched the Forced Labour Single Portal, which will serve as the central access point for information and submissions under the Regulation.

The Guidelines do not create new legal obligations, but they provide an important indication of how the Forced Labour Regulation is likely to be applied in practice. With the Regulation set to apply from 14 December 2027, economic operators should use the remaining transition period to assess whether their existing compliance systems are capable of identifying forced labour risks, documenting mitigation measures and responding to information requests from competent authorities.

Following on from the briefing on the Forced Labour Regulation itself, this briefing outlines the aspects of the Guidelines that are particularly relevant to economic operators.

What the Guidelines Cover

The Guidelines contain explanations regarding the legal context, scope, investigative process, enforcement and penalties, due diligence guidance for economic operators and procedures for petitioners to submit information on possible violations. It is a result of consultations with all interested parties, including international organisations, Member States, businesses and business associations, trade unions and civil society organisations.

The Guidelines confirm the broad scope of the Forced Labour Regulation and, consequently, its great relevance to economic operators: As of 14 December 2027, the prohibition on products made with forced labour applies to all products being placed or made available on the EU market, regardless of whether those products or their components were produced or imported into the EU before that date.The Guidelines clarify that the Forced Labour Regulation does not cover the provision of services, even where they are associated with the placing of a product on the market, such as transport, warehousing or logistic services.

The prohibition on products made with forced labour applies to all economic operators, while taking into account the specific challenges of SMEs. Furthermore, it makes clear that the definition of forced labour covers privately imposed as well as state-imposed forced labour and forced child labour, while certain forms of work, such as domestic work, compulsory military service and work performed as a result of a criminal conviction, are excluded.

Although non-binding, the broad scope of the Forced Labour Regulation makes it essential for economic operators to take appropriate measures to bring their businesses into compliance with the new requirements. In this regard, the Commission’s guidance on due diligence in relation to forced labour is of particular importance to them. It can assist economic operators, especially SMEs, in mitigating the risk of forced labour in their operations and supply chains through dedicated guidance adapted to their resource constraints.

The explanations regarding the investigation process are also relevant for economic operators, particularly where they clarify the operators’ rights and obligations during such proceedings. They further give practical content to the due diligence Guidelines by indicating the types of information that economic operators should ideally be able to retrieve from their due diligence systems.

Managing Forced Labour Risks Through a Due Diligence System

Although the Forced Labour Regulation does not impose any due diligence obligations, a due diligence system is the main tool for companies to comply with the Regulation. Provided that no specific legal obligation to fulfil due diligence obligations arises from any other EU legal act, companies are free to decide how best to address the risks of forced labour.

In the Guidelines, the Commission proposes a specific due diligence system, which builds on previous EU guidelines and the OECD due diligence framework.

The Commission’s proposal presents due diligence as an ongoing, risk-based process aimed at identifying, preventing, mitigating, ending and remedying forced-labour risks in companies’ own operations, supply chains and business relationships. It comprises six steps:

• Step 1 - Embed forced labour due diligence into company policies and risk management systems: Companies should develop strategies and expectations regarding the prevention of forced labour and integrate them into their internal policies, governance structures and risk management processes. This includes communicating expectations to staff, business partners and the public and embedding them in ordinary business processes.

• Step 2 - Identify and assess forced labour risks in the company’s operations, supply chains and business relationships: Economic operators should carry out a risk-based assessment of where forced labour risks may arise. The risks identified in a broad scoping exercise should be assessed in terms of their significance and the company's involvement, and then prioritized.

• Step 3 - Prevent, mitigate and bring to an end forced labour risks: Where risks are identified, companies should take appropriate measures to prevent or reduce them, including through contractual requirements, corrective action plans, or changes to business practices. If cases of forced labour risks cannot be managed in any other way, companies may need to use and exercise their leverage, suspend the business relationship, or ultimately terminate it, while considering the potential negative consequences.

• Step 4 - Monitor and assess the implementation and results of due diligence measures including those relating to business partners and suppliers: Companies should track whether their due diligence measures are actually implemented and whether they effectively address forced labour risks. Monitoring should extend beyond the company’s own operations to include monitoring and periodic assessments of business partners and suppliers. This requires an ongoing review of the company’s due diligence policies and measures, with adjustments where monitoring shows that existing measures are insufficient.

• Step 5 - Communicate how forced labour risks are addressed: Economic operators should disclose publicly relevant information about their companies’ due diligence obligations regarding forced labour, including how these obligations are incorporated into their policies and management systems, which areas present high forced labour risks, what measures they have taken to address those risks and what results those measures have achieved.

• Step 6 - Take or participate in remedial measures in forced labour situations: Where a company has caused or contributed to forced labour situations, it should provide for or cooperate in appropriate remediation. This requires establishing complaint mechanisms at the operational level and includes, for example, restitution, rehabilitation, financial and non-financial compensation as well as internal accountability or disciplinary measures.

At each step, the Commission’s proposal takes particular account of the challenges faced by SMEs and sets out recommendations adapted to their size and limited resources.

Role of Economic Operators in the Investigation Process: Obligations and Rights

The establishment of a due diligence system is particularly recommended for economic operators because the lead competent authority is empowered to request information from relevant economic operators at any stage of the investigative process. The Guidelines set out non-exhaustive illustrative lists of information that the lead competent authority may request during the investigative process. The requested information may relate, in particular, to the economic operators’ measures to identify and combat forced labour risks concerning the products in question, to the working conditions at the site of the alleged forced labour where the products were produced or from which they originate, and to the products under assessment.

For the submission of requested information, the lead competent authority must set a deadline of at least 30 and no more than 60 working days; an extension may be granted where the economic operator provides a valid justification. In this regard, the authority must take into account the circumstances of the individual case, particularly including the operator’s size and resources.

Economic operators must provide the requested information accurately and completely and participate constructively in the investigation. If companies fail to comply with the obligation to cooperate, there will be adverse consequences: The lead competent authority must conduct its investigation in this case based on other available information, and the company's refusal to cooperate may constitute relevant evidence against it. When assessing a refusal to cooperate, the authority must also consider the limited capacities of SMEs.

These operators’ obligations are balanced by their rights to be informed and heard: Within three working days of initiating an investigation, the lead competent authority must inform the economic operator of the investigation and its potential consequences, the products and production sites concerned, the reasons for the investigation where disclosure would not jeopardise its outcome, and the operator’s right to submit observations and relevant information within a specified deadline.

If the lead competent authority eventually finds a violation of the forced labour prohibition, it must issue a corresponding decision. This decision includes a prohibition on placing or making available the products concerned on the EU market and on exporting them and an order to withdraw products already made available. If economic operators fail to comply with these orders, the orders may be enforced and sanctions may be imposed.

Conclusion

Economic operators should use the publication of the Guidelines as an opportunity to align their internal policies and processes with the implicit requirements of the Forced Labour Regulation before it becomes applicable on 14 December 2027. The Commission’s Webinars beginning in September 2026 will serve as additional preparation for the implementation of the Forced Labour Regulation. Also, the Commission is in the process of developing an EU forced labour risk database, intended to provide information on documented forced-labour risks associated with specific products and geographical areas.

BLOMSTEIN will closely monitor further developments surrounding the Forced Labour Regulation. If you have any questions on this topic, Florian Wolf, Bruno Galvão, Sarah Beischau and the entire ESG Team are ready to assist you.