EU Forced Labor Regulation: Supply Chain Leaders’ Next Steps Before 2027

Allison Raley and Nikita Kulkarni, AGG International Trade attorneys, published an article for Supply & Demand Chain Executive discussing how supply chain leaders should prepare for the EU’s new forced labor regulation (“FLR”), which demands a level of supply chain visibility that many compliance programs don’t yet have.

Goods at every stage of production are covered, and forced labor isn’t limited to the EU. If a single upstream component is tainted, the finished product can be banned. The attorneys recommend five steps that will help supply chain leaders prepare their networks:

1. Scope visibility where it matters and outline products and lanes that touch the EU;
2. Work with legal and ESG to review potential areas of high risk;
3. Make supplier choices and management decisions that align with FLR expectations;
4. Treat documentation and data as a logistics asset; and,
5. Build out a response strategy for gaps that have been identified.

“The EU’s FLR signals that regulators, customers and workers expect more than good intentions,” said Allison and Nikita. “For supply chain leaders, it is also an opportunity: The same visibility and discipline that will help you weather FLR scrutiny will make your networks more resilient to disruption, more responsive to customers and better aligned with the ethical standards that are increasingly driving buying decisions.”

To view the full article, please click here.