Introduction
Across the world, there is growing recognition that the current model of corporate globalization has come at too high a cost for human rights and the environment.[1] From supply chain-linked child labor in cobalt mines[2] to deforestation driven by commodity agriculture,[3] the negative ripple effects of international business operations are no longer hidden or excusable. Over the past decade, a surge of activism, investor pressure, and civil society mobilization has coalesced into one central demand: corporations must be held accountable for the social and environmental consequences of their global value chains.[4] As climate goals tighten and social justice movements gain traction, corporate responsibility is becoming both a legal expectation and market imperative. In the European Union, this momentum has culminated in a groundbreaking piece of legislation, the Corporate Sustainability Due Diligence Directive (“CSDDD”).[5]
Adopted on July 25, 2024, after years of debate and revision, the CSDDD creates a legally binding obligation for large international companies to identify, prevent, mitigate, and account for actual and potential adverse human rights and environmental impacts throughout their operations, subsidiaries, and business relationships.[6] It marks the European Union’s (“EU”) most comprehensive attempt to translate voluntary international standards, such as the United Nations (“UN”) Guiding Principles on Business and Human Rights (“UNGPs”),[7] into enforceable law.[8] The directive comes at a moment when voluntary policies have proven insufficient to prevent corporate complicity in abuses and when the climate crisis demands that companies play an active role in decarbonizing their operations.[9] By transforming voluntary norms into legal obligations, the EU is positioning itself as a global leader in sustainable and ethical corporate regulation.
While the EU moves forward, the United States (“U.S.”) has taken a defensive approach. Senate Republicans and corporate lobbying groups have mounted opposition to the CSDDD’s extraterritorial reach, seeking to shield American businesses from its obligations.[10] This divergence between the EU and U.S. reveals not only a regulatory gap, but a broader divide. Where the EU sees regulation as a tool for justice and sustainability, these U.S. policymakers often view it as a constraint on economic freedom.[11] The CSDDD signals a commitment to aligning capitalism with environmental limits and human dignity, while the U.S. resistance reflects an outdated model that prioritizes corporate autonomy over global responsibility.[12] As the EU defines the future of ethical business, the U.S. risks being left behind.
From Voluntary Principles to Binding Law: The Evolution of Corporate Accountability
The CSDDD builds on over a decade of international frameworks that have attempted to address the human rights and environmental harms of global commerce. The foundation was laid by the UNGPs, adopted by the Human Rights Council in 2011.[13] The UNGPs established a three-pillar framework: the state duty to protect human rights, the corporate responsibility to respect them, and the need for access to remedy.[14] Crucially, the UNGPs established that corporations must undertake due diligence to assess and address the human rights impacts on their operations.[15] However, the principles were non-binding, leaving implementation dependent on corporate goodwill and market incentives.[16] Many companies embraced the UNGPs in principle while failing to implement meaningful safeguards in practice.[17] As a result, human rights abuses linked to business operations continued across global supply chains.[18]
In the years that followed, a handful of European countries moved to codify these voluntary norms. France led the way in 2017 with its Duty of Vigilance Law, requiring large French companies to develop and implement due diligence plans addressing serious violations of human rights and environmental harm.[19] Germany followed with its Supply Chain Due Diligence Act in 2021, applying to businesses with 3,000 or more employees.[20] Norway, Switzerland, and the Netherlands enacted similar, but varying, frameworks.[21] The diversity in scope, enforcement, and corporate liability provisions across national laws created fragmentation within the EU, leading to calls for a unified regional standard.[22] The CSDDD responds to this need for harmonization, while also advancing a more ambitious vision. It seeks to bring coherence to the EU market, provide legal clarity for companies, and empower those harmed by corporate conduct to seek remedy.[23] By codifying due diligence obligations and attaching real legal consequences for failure, the CSDDD represents a turning point in the evolution of corporate regulation.
CSDDD Scope and Requirements
The CSDDD applies to both EU-based and non-EU companies that meet specific thresholds.[24] The directive covers EU companies with more than 1,000 employees and a global net turnover[25] of at least €450 million.[26] For companies in high-impact sectors, such as textiles, agriculture, forestry, and mineral extraction, a lower threshold applies, at least 250 employees and €40 million in turnover.[27] Outside the EU, the directive captures non-EU companies that generate over €450 million in revenue from the EU market.[28] This means that hundreds of major U.S.-based companies, including Nike, PepsiCo, ExxonMobil, and 3M, fall under the directive’s jurisdiction.[29] Covered companies must establish a due diligence process that integrates sustainability risk management into their corporate governance policies.[30] This includes identifying actual or potential human rights and environmental harms, prioritizing risks based on severity and likelihood, and taking appropriate measures to prevent, mitigate, or end those harms.[31] Importantly, companies must conduct meaningful engagement with stakeholders, including workers, unions, NGOs, and affected communities, throughout the due diligence process.[32] Companies must also establish complaint mechanisms, monitor and report on their due diligence efforts, and provide remediation when they have caused or contributed to harm.[33]
The CSDDD defines adverse impacts expansively. Human rights abuses include forced labor, child labor, wage theft, denial of freedom of association, and violations of indigenous land rights.[34] Environmental harms include illegal deforestation, water and air pollution, biodiversity loss, and activities that contribute to climate change or violate international environmental treaties.[35] In addition to these obligations, the directive mandates that companies adopt climate transition plans aligned with the Paris Agreement’s goal of limiting global warming to 1.5 degrees Celsius.[36] While enforcement of the CSDDD’s climate provision is limited to supervision of plan adoption rather than implementation, it signals the EU’s intention to embed climate governance into corporate strategy.[37] The CSDDD contains two powerful enforcement mechanisms: (1) administrative supervision[38] and (2) civil liability.[39] Member states must designate authorities to investigate non-compliance and issue sanctions.[40] These authorities can impose penalties of up to five percent of a company’s global net turnover.[41]
Additionally, victims of harm, whether inside or outside the EU, can bring civil suits against companies that fail to meet their due diligence obligations.[42] While claimants bear the burden of proving harm, causation, and company fault, courts may compel companies to disclose internal documents to aid plaintiffs.[43] National courts of EU Member States will have jurisdiction over civil claims.[44] Victims may sue in the Member State where the company is domiciled, or, in the case of non-EU companies, where it generates the highest turnover in the EU.[45] This allows foreign victims, including workers and communities outside the EU, to bring claims in the domestic courts of the Member State responsible for supervising the company’s compliance with the CSDDD.[46]
Challenges in Practice: Uneven Enforcement, Extraterritorial Limits, and Political Resistance
Despite its ambition, the CSDDD faces challenges in implementation. Because enforcement is delegated to national authorities, the effectiveness of the directive will depend on political will, institutional capacity, and legal culture of each member state.[47] Some countries may adopt stricter penalties and take a proactive approach, while others may implement the directive in a more minimalist way. This creates the risk of uneven enforcement across the EU and raises concerns about forum shopping by companies seeking lenient jurisdictions. Without uniform implementation, companies may be subject to vastly different expectations depending on where they operate, which could erode legal certainty. The CSDDD’s extraterritorial applicability complicates its implementation. Although the EU cannot investigate companies on foreign soil,[48] it can impose obligations on foreign businesses operating in the EU market.[49] With its extraterritorial application, the CSDDD follows the footsteps of the EU’s General Data Protection Regulation (“GDPR”),[50] which reshaped global privacy practices and implemented an extraterritorial scope.[51] The GDPR’s extraterritorial application has shown that EU regulations can influence global business behavior, with non-EU companies like Google,[52] Meta,[53] and Clearview AI[54] facing significant fines for processing EU residents’ data. However, CSDDD enforcement abroad will rely on corporate cooperation, third-party verification, and the ability of EU regulators to incentivize compliance.[55] The EU’s ability to ensure meaningful compliance abroad will depend on how effectively it pairs regulatory incentives with market access leverage.[56] Critics, including the Chinese Chamber of Commerce[57] and U.S. trade groups,[58] have accused the EU of neo-colonialism and overreach, but supporters, including activists Oxfam and Amnesty International, argue that the directive simply insists that doing business in the EU requires meeting their ethical standards.[59]
The U.S. response to the CSDDD has been overwhelmingly negative. Senate Republicans have introduced legislation aimed at insulating American businesses from the directive’s legal consequences.[60] In public statements, lawmakers and business groups have criticized the CSDDD as an unfair burden on U.S. companies and a threat to free enterprise.[61] U.S. officials have also lobbied EU counterparts to weaken the directive and exempt certain American businesses.[62] This backlash reflects a broader reluctance in the U.S. to impose binding human rights or environmental obligations on corporations.[63] While the U.S. has some transparency requirements, such as the Dodd-Frank Act’s conflict minerals provisions[64] and the Uyghur Forced Labor Prevention Act,[65] it lacks a unified due diligence framework.[66] U.S. courts have limited the scope of the Alien Tort Statute,[67] and the Supreme Court’s 2021 decision in Nestle v. Doe[68] emphasized that general corporate activity in the U.S. is not sufficient to impose liability for human rights abuses abroad.[69] Although some justices acknowledged that corporations can be sued under international law,[70] the U.S. legal system remains largely resistant to transnational corporate accountability.[71] By resisting the CSDDD and refusing to develop its own comparable legislation, the U.S. risks not only regulatory divergence, but also reputational damage. As consumers, investors, and trading partners demand higher standards,[72] U.S. companies that lag behind may find themselves excluded from business opportunities, avoided by ESG investors, or implicated in litigation.[73] Instead of obstructing the CSDDD, the U.S. should embrace the opportunity to lead by crafting its own due diligence framework.
The Omnibus Proposal: The EU’s Response to CSDDD Criticism
Due to these mounting concerns from critics, the European Commission presented an Omnibus Proposal on February 26, 2025, aimed at simplifying and clarifying aspects of the CSDDD.[74] The proposal introduced several adjustments, highlighting the tension between ambition and feasibility. Notably, it postpones the transposition and application deadlines, giving companies and authorities more time to prepare.[75] It also aims to simplify and streamline reporting obligations, ensuring there is greater alignment between the CSDDD and the Corporate Sustainability Reporting Directive to reduce duplication and reporting fatigue.[76] While the proposal does not dilute the core due diligence and corporate responsibility obligations of the CSDDD, it reflects a political compromise to preserve the directive’s legitimacy while easing rollout.[77] In doing so, the proposal aims to maintain the EU’s leadership on corporate sustainability, while making implementation more realistic.[78] However, it may also have unintended effects, such as weakening transparency and disrupting market efficiency.[79] The ongoing challenge of balancing competition with sustainability will require policymakers to thoughtfully consider the proposal by weighing short-term economic priorities and long-term environmental and social consequences.[80]
The Future of Corporate Accountability: The CSDDD as Catalyst for Reform
Even with the proposed changes, the CSDDD is likely to accelerate a global trend toward mandatory due diligence. Countries that take early action on due diligence are laying the groundwork for a more equitable and sustainable global economy. In addition to the EU, countries like Canada, South Korea, and Switzerland are considering or have adopted due diligence legislation.[81] Further, the African Union’s Malabo Protocol, if ratified, would create the first international criminal court with jurisdiction over corporations for environmental and human rights crimes.[82] In domestic courts, cases like Nevsun Resources v. Araya[83] in Canada demonstrate the growing willingness of judges to hold corporations accountable for overseas abuses.[84] This global momentum suggests that due diligence is becoming the new norm, not the exception, and that the days of willful ignorance are coming to an end. Businesses that embrace the CSDDD’s principles now will be better positioned to succeed in a future where ethical performance is a prerequisite for market access, reputational trust, and legal compliance.
The CSDDD represents a historic shift in the regulation of global business. It affirms that corporations must not only pursue profit but do so in ways that respect human dignity and the environment. While the directive imposes new responsibilities, it also creates opportunities for innovation in supply chain management, leadership in climate action, and restoring public trust in private enterprise.[85] The U.S. has a choice. It can continue to defend corporate impunity and resist the tide of reform, or it can join the international community in shaping a more just and sustainable economic order. The CSDDD is not perfect, and its implementation will require vigilance, but it charts a course toward accountability that other nations should follow. In this emerging era of corporate responsibility, nations that choose to lead have a rare chance to redefine the global economy. Those that hesitate risk being remembered not for what they protected, but for what they failed to confront.
[1] Human Rights and Environmental Due Diligence Laws Crucial to Combat Irresponsible Business Activities, United Nations (July 4, 2022), https://www.ohchr.org/en/press-releases/2022/07/human-rights-and-environmental-due-diligence-laws-crucial-combat (“‘Businesses operating in the global economy routinely abuse the right to a clean, healthy and sustainable environment and other human rights.’”).
[2] Industry Giants Fail to Tackle Child Labor Allegations in Cobalt Battery Supply Chains, Amnesty Int’l (Nov. 15, 2017), https://www.amnesty.org/en/latest/press-release/2017/11/industry-giants-fail-to-tackle-child-labour-allegations-in-cobalt-battery-supply-chains/ (“Amnesty International documented children and adults mining cobalt in narrow man-made tunnels, at risk of fatal accidents and serious lung disease.”).
[3] Mikaela Weisse & Elizabeth Goldman, Just 7 Commodities Replaced an Area of Forest Twice the Size of Germany Between 2001 and 2015, World Res. Inst. (Feb. 11, 2021), https://www.wri.org/insights/just-7-commodities-replaced-area-forest-twice-size-germany-between-2001-and-2015 (“The seven commodities analyzed represent 57% of agriculture-related tree cover loss from 2001-2015).
[4] Over 100 NGOs Demand Human Rights and Environmental Due Diligence Legislation, Corp. Just. (Dec. 2, 2019), https://corporatejustice.org/news/over-100-ngos-demand-human-rights-and-environmental-due-diligence-legislation/; Susan Cosier, When Customers and Investors Demand Corporate Sustainability, NRDC (June 27, 2024), https://www.nrdc.org/stories/when-customers-and-investors-demand-corporate-sustainability; How Can We Hold Companies Responsible for the Damage They Cause?, Glob. Witness (Nov. 1, 2021), https://globalwitness.org/en/campaigns/corporate-accountability/how-can-we-hold-companies-responsible-for-the-damage-they-cause/.
[5] Directive 2024/1760 of the European Parliament and of the Council of 13 June 2024 on Corporate Sustainability Due Diligence and Amending Directive 2019/1937 and Regulation 2023/2859 [hereinafter CSDDD].
[6] Id.; Corporate Sustainability Due Diligence, Eur. Comm’n, https://commission.europa.eu/business-economy-euro/doing-business-eu/sustainability-due-diligence-responsible-business/corporate-sustainability-due-diligence_en (last visited Mar. 19, 2025).
[7] U.N. Hum. Rts. Council, Guiding Principles on Business and Human Rights: Implementing the United Nations “Protect, Respect and Remedy” Framework, U.N. Doc. A/HRC/17/31 (Mar. 21, 2011), adopted by the Hum. Rts. Council, Res. 17/4, U.N. Doc. A/HRC/RES/17/4 (July 6, 2011) (setting out the global standard for states and corporations to prevent and remedy human rights abuses linked to business activity).
[8] Nicolas Bueno, Nadia Bernaz, Gabrielle Holly, & Olga Martin-Ortega, The EU Directive on Corporate Sustainability Due Diligence (CSDDD): The Final Political Compromise, 9 Bus. & Hum. Rts. J. 294, 294 (2024).
[9] Erin Elizabeth Macek, Scratching the Corporate Back: Why Corporations Have No Incentive to Define Human Rights, 11 Minn. J. Glob. Trade 101, 116 (2002). See also Alexanra França, Lucas López-Manuel, Antonio Sartal, & Xosé H. Vázquez, Adapting Corporations to Climate Change: How Decarbonization Impacts the Business Strategy-Performance Nexus, 32 Bus. Strategy & The Env’t 5615 (2023).
[10] Mark Segal, Senate Republicans Launce Legislation to Shield U.S. Companies from EU Sustainability Due Diligence Rules, ESG Today (Mar. 13, 2025), https://www.esgtoday.com/senate-republicans-launch-legislation-to-shield-u-s-companies-from-eu-sustainability-due-diligence-rules/; Fiona McNally, US Senator Files Anti-CSDDD Bill, Resp. Inv. (Mar. 14, 2025), https://www.responsible-investor.com/us-senator-files-anti-csddd-bill/ (the “Act would protect companies from the EU’s ‘harmful extraterritorial regulations’ by prohibiting US companies from complying, or from lawmakers taking any ‘adverse reaction’ against entities which do not comply with the rules.”).
[11] Rachel Ledbetter, Overregulation is Crippling Business, Getting Regulations Right is the Key to Growth, U.S. Chamber of Com. (Jan. 16, 2025), https://www.uschamber.com/improving-government/overregulation-is-crippling-business-getting-regulations-right-is-the-key-to-growth (discussing how excessive regulations strain American businesses, hindering economic growth and wage increases).
[12] ESG in 2024 and Outlook for 2025 in the US and EU: A Tale of Two Regions, Barnes & Thornburg (Jan. 7, 2025), https://btlaw.com/en/insights/alerts/2025/esg-in-2024-and-outlook-for-2025-in-the-us-and-eu-a-tale-of-two-regions (the US pushback is “contrasted starkly with the EU, where [ESG regulations] have faced little resistance and are broadly accepted as necessary for global sustainability goals.”).
[13] See U.N. Hum. Rts. Council, supra note 7.
[14] UN Guiding Principles 101, Shift Project, https://shiftproject.org/resources/ungps101/ (last visited Mar. 19, 2025).
[15] U.N. Hum. Rts. Council, supra note 7.
[16] The Future of Human Rights Due Diligence: UNGPs and the Draft Treaty on Business and Human Rights, Latham & Watkins (Nov. 21, 2022), https://www.lw.com/admin/upload/SiteAttachments/Alert%203035.pdf.
[17] Justice Delayed: 10 Years of UN Guiding Principles, Eur. Coal. Corp. Just. (June 16, 2021), https://corporatejustice.org/news/justice-delayed-10-years-of-un-guiding-principles/ (“UNGPs can only work if governments want them to.”).
[18] Id.
[19] Loi 2017-399 du 27 mars 2017 relative au devoir de vigilance des sociétés mères et des entreprises donneuses d’orde [Law No. 2017-399 of March 27, 2017 on the Duty of Vigilance of Parent and Ordering Companies], Journal Officiel de la République Française [J.O.] [Official Gazette of France], Mar. 28, 2017 (Fr.).
[20] Gesetz über die unternehmerischen Sorgfaltspflichten in Lieferketten [Supply Chain Due Diligence Act], July 16, 2021, Bundesgesetzblatt [BGBI.] (Ger.).
[21] Lov om virksomheters åpenhet og arbeid med grunnleggende menneskerettigheter og anstendige arbeidsforhold (Åpenhetsloven) [Act on Business Transparency and Work on Fundamental Human Rights and Decent Working Conditions (Transparency Act)], LOV-2021-06-18-99 (Nor.) (requires larger companies to conduct human rights due diligence across their supply chains, report on those efforts, and provide information to the public upon request regarding their handling of potential human rights impacts); Code des obligations [CO] [Code of Obligations], Mar. 30, 1911, SR 220 arts. 964a-964l (as amended by the Federal Council’s counterproposal to the Responsible Business Initiative, effective Jan. 1, 2022) (Switz.) (imposing mandatory human rights and environmental due diligence and reporting requirements on large companies, specifically concerning conflict minerals and child labor in their supply chains); Wet verantwoord en duurzaam international ondernemen [Responsible and Sustainable International Business Conduct Act], Kamerstuk 35925 (as adopted by the Tweede Kamer, Jan. 2024) (Neth.) (proposing mandatory human rights and environmental due diligence obligations for Dutch companies and foreign companies operating in the Netherlands, with extraterritorial scope and civil liability provisions).
[22] Matthias Bauer, What is Wrong with Europe’s Shattered Single Market? – Lessons from Policy Fragmentation and Misdirected Approaches to EU Competition Policy, Eur. Ctr. Int’l Pol. Econ. (Apr. 2023), https://ecipe.org/publications/europes-shattered-single-market-eu-competition-policy/.
[23] Eur. Comm’n, supra note 6.
[24] CSDDD, art. 2.
[25] Net turnover is the measure of annual sales volume minus all costs, including sales tax and discounts. Glossary: Net Turnover, Eur. Comm’n, https://ec.europa.eu/eurostat/statistics-explained/index.php?title=Glossary:Net_turnover_-_EBS (last visited Mar. 21, 2025).
[26] CSDDD, art. 2(1).
[27] Id.
[28] Id. art. 2(2).
[29] Nike, Inc. Reports Fiscal 2024 Fourth Quarter and Full Year Results, Nike (Jun. 27, 2024), https://investors.nike.com/investors/news-events-and-reports/investor-news/investor-news-details/2024/NIKE-Inc.-Reports-Fiscal-2024-Fourth-Quarter-and-Full-Year-Results/default.aspx (reporting over $14 billion in revenue from Europe, the Middle East, and Africa in FY2024); PepsiCo Revenue 2010-2024, Macrotrends, https://www.macrotrends.net/stocks/charts/PEP/pepsico/revenue (last visited Mar. 19, 2025) (showing that PepsiCo generated over $10 billion in revenue from its Europe segment in recent years); ExxonMobil Announces 2024 Results, ExxonMobil (Jan. 31, 2025), https://corporate.exxonmobil.com/news/news-releases/2025/0131_exxonmobil-announces-2024-results (reporting $21.3 billion in revenue from its Europe segment in 2024); 3M Reports Fourth-Quarter and Full-Year 2024 Results; Initiates Full-Year 2025 Financial Guidance, 3M (Jan. 21, 2025), https://investors.3m.com/news-events/press-releases/detail/1874/3m-reports-fourth-quarter-and-full-year-2024-results (reporting $8.4 billion in sales from its Europe, Middle East, and Africa segment in 2024).
[30] CSDDD, art. 5.
[31] Id. arts. 6–11.
[32] Id. art. 8(3).
[33] Id. arts. 9(1), 10, & 8(2).
[34] Id. Annex I, pt. I, § 1.
[35] Id.
[36] Id. art. 15(1). See also Paris Agreement to the United Nations Framework Convention on Climate Change art. 2(1)(a), Dec. 12, 2015, T.I.A.S. No. 16-1104 (aiming to strengthen the global response to climate change by “holding the increase in the global average temperature to well below 2 °C above pre-industrial levels and pursuing efforts to limit the temperature increase to 1.5 °C above pre-industrial levels.”).
[37] See id. (the plan aims to ensure the company’s obligation to act with “best efforts”).
[38] Id. art. 24–28. Authorities must have the power to conduct investigations, order cessation of infringements, require remedial action, and impose proportionate and dissuasive penalties. Id. art. 25.
[39] Id. art. 29.
[40] Id. art. 24(1).
[41] Id. art. 26.
[42] Id. art. 29(1). A company is not liable if the damage was caused solely by a business partner in its chain of activities, without the company’s own failure contributing to it. Id. art. 29(2).
[43] Id. art. 29(3).
[44] Id. art 24(3) (jurisdiction determined by the Member State responsible for supervising the company).
[45] Id.
[46] Id. art. 29 (requiring Member States to ensure access to civil remedies in their national courts for harm caused by a company’s failure to meet due diligence obligations).
[47] Farid Baddache, CS3D Implementation Challenges: A Forward Perspective, KSAPA (Apr. 27, 2024), https://ksapa.org/cs3d-implementation-challenges-a-forward-perspective/.
[48] Bueno, et. al., supra note 8, at 298 (“As public authorities cannot investigate beyond the territory of the EU, for example at the headquarters of a company registered in Switzerland, the U.S. or China, it is questionable how a Member State would sanction a company abroad and enforce a penalty in practice.”).
[49] CSDDD, art. 2(2).
[50] Regulation 2016/679 of the European Parliament and the Council of 27 April 2016 on the Protection of Natural Persons with Regard to the Processing of Personal Data and on the Free Movement of Such Data, and Repealing Directive 95/46/EC (General Data Protection Regulation), 2016 O.J. (L 119) (establishing a comprehensive framework for personal data protection and privacy rights within the EU, with extraterritorial application to companies processing EU residents’ data).
[51] Id. art. 3 (applies to the processing of personal data “in the context of activities of an establishment of a controller or a processor in the Union, regardless of whether the processing takes place in the Union or not”).
[52] In 2019, France’s National Data Protection Commission fined Google €50 million for failing to provide transparent user content. The CNIL’s Restricted Committee Imposes a Financial Penalty of 50 Million Euros Against Google LLC, Eur. Data Prot. Bd. (Jan. 21, 2019), https://www.edpb.europa.eu/news/national-news/2019/cnils-restricted-committee-imposes-financial-penalty-50-million-euros_en. Although based in the U.S., Google was deemed subject to the GDPR due to its data-driven services offered to EU residents. Id.
[53] In 2023, Meta Platforms Ireland was fined €1.2 billion, the largest GDPR fine to date, for transferring EU users’ data to the U.S. in violation of the GDPR cross-boarder transfer rules. 1.2 Billion Euro Fine for Facebook as a Result of EDPB Biding Decision, Eur. Data Prot. Bd. (May 22, 2023), https://www.edpb.europa.eu/news/news/2023/12-billion-euro-fine-facebook-result-edpb-binding-decision_en. The fine was a “strong signal to organi[z]ations that serious infringements have far-reaching consequences.” Id.
[54] In 2024, The Netherlands Data Protection Agency fined Clearview AI, an American facial recognition company, €30.5 million for creating a database of billions of photos of faces. Mike Corder, Clearview AI Fined $33.7 Million by Dutch Data Protection Watchdog Over ‘Illegal Database’ of Faces, AP News (Sept. 3, 2024), https://apnews.com/article/clearview-ai-facial-recognition-privacy-fine-netherlands-a1ac33c15d561d37a923b6c382f48ab4.
[55] Humberto Cantú Rivera, The Corporate Sustainability Due Diligence Directive Beyond Europe, Verfassungsblog (Jun. 14, 2024), https://verfassungsblog.de/the-corporate-sustainability-due-diligence-directive-csddd-beyond-europe/.
[56] Id.
[57] CCCEU Submits Feedback to Draft Proposal for EU’s New Due Diligence Rules, China Daily, https://govt.chinadaily.com.cn/s/202205/31/WS6295d9df498e6a12c122dc15/ccceu-submits-feedback-to-draft-proposal-for-eus-new-due-diligence-rules.html (May 31, 2022) (members “voiced serious concerns about excessive administrative burdens and disproportionate liabilities on companies, as well as the insufficient transition period for businesses to adapt to the transposed due diligence rules.”).
[58] Elizabeth Meager, US Business Groups Set on Weakening EU Sustainability Rules, Sustainable Views (Jan. 9, 2025), https://www.sustainableviews.com/us-business-groups-set-on-weakening-eu-sustainability-rules-4895cf26/; U.S. Chamber of Commerce Coalition Letter to Congress Voicing Concerns Over EU Corporate Sustainability Due Diligence Directive, US Chamber of Com. (Dec. 9, 2024), https://www.uschamber.com/finance/u-s-chamber-of-commerce-coalition-letter-to-congress-voicing-concerns-over-eu-corporate-sustainability-due-diligence-directive (“CS3D has broad extra-territorial reach that is not justified from a legal or market standpoint and is too complex and unrealistic for businesses to implement. The Directive intrudes on U.S. regulatory authority and threatens American competitiveness by capturing U.S. parent companies and affiliates in European regulatory preferences regardless of any nexus to Europe.”).
[59] Jack Schickler, Governments Support Stripped-Down Corporate Due Diligence Law, Euro News (Mar. 15, 2024), https://www.euronews.com/my-europe/2024/03/15/governments-support-stripped-down-corporate-due-diligence-law (“activists such as Oxfam and Amnesty International say the rules will stop corporations making profits from human suffering.”).
[60] Prevent Regulatory Overreach from Turning Essential Companies into Targets Act (PROTECT USA Act) of 2025, S. __, 119th Cong. (2025), available at https://www.hagerty.senate.gov/wp-content/uploads/2025/03/HLA25119.pdf (proposing to shield U.S.-designated critical infrastructure companies from the extraterritorial application of foreign regulations, including the CSDDD, by barring federal agencies from enforcing or cooperating with such measures).
[61] Meager, supra note 58.
[62] See id. See also Jordan Wolman & Marianne Gros, Trump Allies Take Aim at Europe’s Green Reporting Rules, Politico (Jan. 20, 2025), https://www.politico.eu/article/donald-trump-europe-green-reporting-rules-allies-america-washington/.
[63] See Dalia Palombo, The US at the Margins of Business and Human Rights, 25 Int’l Cmty. L. Rev. 247, 251–53 (2023); The U.S. Government’s Opposition to the Business and Human Rights Treaty Process, U.S. Mission Geneva (Oct. 26, 2020), https://geneva.usmission.gov/2020/10/26/the-u-s-governments-opposition-to-the-business-and-human-rights-treaty-process/.
[64] 15 U.S.C. § 78m-2 (requiring certain companies to disclose their use of conflict minerals originating in the Democratic Republic of the Congo or adjoining countries to prevent funding armed conflict and human rights abuses).
[65] Pub. L. No. 117-78, 135 Stat. 1525 (2021) (prohibiting the importation of goods produced wholly or in part in the Xinjiang Uyghur Autonomous Region of China unless the importer can demonstrate by clear and convincing evidence that the goods were not made with forced labor).
[66] See Marc Morros Bo & Sergio Garrido Vallespí, Human Rights Due Diligence in the United States and the EU: Differences, Trends, and a Corporate Dispute Resolution Critique, 3 Esade L. Rev. 62 (2024).
[67] 28 U.S.C. § 1350 (providing district courts with jurisdiction over civil actions by aliens for torts committed in violation of international law or a U.S. treaty).
[68] 593 U.S. 628 (2021).
[69] Id. at 634 (Milan plaintiffs who were trafficked and enslaved on cocoa farms in Ivory Coast could not bring claims under the Alien Tort Statute because the alleged forced labor occurred outside the U.S. and general corporate activity in the U.S. was insufficient to overcome the presumption against extraterritoriality).
[70] Id. at 650 (Sotomayor, J., Breyer, J., & Kagan, J. concurring) (“from the moment the ATS became law, Congress expected federal courts to identify actionable torts under international law and to provide injured plaintiffs with a forum to seek redress.”). See also Flomo v. Firestone Nat. Rubber Co., LLC, 643 F.3d 1013, 1013 & 1025 (7th Cir. 2011) (holding that the ATS allows for corporate liability and rejecting the argument that international law excludes corporations from tort liability).
[71] See Kiobel v. Royal Dutch Petroleum Co., 569 U.S. 108 (2013) (holding that the ATS does not confer jurisdiction over violations that occur entirely outside of the U.S.); Jesner v. Arab Bank, PLC, 584 U.S. 241 (2018) (holding that foreign corporations may not be defendants in ATS suits); Doe 1 v. Apple Inc., 96 F.4th 403 (D.C. Cir. 2024) (dismissing complaint filed against several major technology companies on behalf of children who were victims of hazardous child labor and cobalt-mining activities in the DRC).
[72] Most Recent Business Statements in Support of Mandatory Due Diligence & the CSDDD, Bus. & Hum. Rts. Res. Ctr. (Apr. 23, 2024), https://www.business-humanrights.org/en/latest-news/most-recent-business-statements-in-support-of-mandatory-due-diligence/; Who Supports the EU Supply Chain Law?, Env’t Just. Found. (Feb. 15, 2024), https://ejfoundation.org/news-media/who-supports-the-eu-supply-chain-law.
[73] See David Lakhdhir, The EU Due Diligence Directive: Implications for U.S. Companies, ABA (Jul. 15, 2024), https://www.americanbar.org/groups/business_law/resources/business-law-today/2024-july/eu-due-diligence-directive-implications-us-companies/; Ted Grozier, Decoding the EU’s ESG Regulations: What U.S. Companies Need to Know, Good Lab, https://getgoodlab.com/resources/the-eu-esg-regulatory-landscape/ (Apr. 27, 2024).
[74] Proposal for a Directive of the European Parliament and of the Council Amending Directives 2006/43/EC, 2013/34/EU, (EU) 2022/2464 and (EU) 2024/1760 as Regards Certain Corporate Sustainability Reporting and Due Diligence Requirements, COM (2025) 80 final (Feb. 26, 2025).
[75] Anna-Stina Reuter, EU Omnibus Proposal: Essential Insights and How to Navigate the Upcoming Changes, Sphera (Feb. 27, 2025), https://sphera.com/resources/blog/eu-omnibus-proposal-essential-insights-and-how-to-navigate-the-upcoming-changes/ (reporting requirements postponed by one year).
[76] Id.
[77] Id.
[78] Id.
[79] The EU’s Omnibus Proposal: What it is Aiming for and What Lies Ahead, World. Econ. F. (Mar. 10, 2025), https://www.weforum.org/stories/2025/03/eu-omnibus-proposal-what-lies-ahead/.
[80] Id.
[81] Fighting Against Forced Labour and Child Labour in Supply Chains Act, S.C. 2023, c. 9 (Can.) (requiring certain Canadian businesses to report on measures taken to prevent and reduce the risk of forced and child labor in their supply chains); Proposed Human Rights and Environmental Due Diligence Act, Bill No. 2107362, 21st Nat’l Assembly (introduced Sept. 28, 2022) (S. Kor.) (proposing mandatory human rights and environmental due diligence obligations for companies operating in South Korea and abroad); Code des obligations [CO] [Code of Obligations], Mar. 30, 1911, SR 220 arts. 964a-964l (as amended by the Federal Council’s counterproposal to the Responsible Business Initiative, effective Jan. 1, 2022) (Switz.) (imposing mandatory human rights and environmental due diligence and reporting requirements on large companies, specifically concerning conflict minerals and child labor in their supply chains).
[82] Protocol on Amendments to the Protocol on the Statute of the African Court of Justice and Human Rights (Malambo Protocol), art. 46C, adopted June 27, 2014, African Union Doc. No. STC/Legal/Min7(1) Rev.1 (not yet in force) (establishing the jurisdiction of the African Court over corporations for international crimes such as corruption, environmental harm, and illicit exploitation of natural resources).
[83] [2020] 1 S.C.R. 166 (Can.).
[84] Id. (holding that a Canadian corporation could be sued in Canadian courts for alleged violations of customary international law abroad, allowing claims related to forced labor at a mine in Eritrea to proceed).
[85] Ulkar Aghayeva, Turning the EU CSDDD Into a Strategic Opportunity: Achieving Sustainable Leadership and Driving ESG Excellence, DNV (Dec. 11, 2024), https://www.dnv.com/supplychain/thought-leadership/turning-the-eu-csddd-into-a-strategic-opportunity/.
