Overview
The Lieferkettensorgfaltspflichtengesetz (LkSG) has applied since 1 January 2023 (expanded in 2024 to companies with at least 1,000 employees in Germany). It requires risk analyses, preventive and remedial measures, complaints procedures and documentation across supply chains.
From autumn 2025, the Federal Office for Economic Affairs and Export Control (BAFA) stopped reviewing annual reports and later deactivated the reporting portal, pending legislative amendments to abolish the reporting duty. Core due diligence obligations remain.
Germany intends to replace or recalibrate the LkSG when transposing the amended EU CSDDD (application from 2029 under Omnibus I). Until then, in-scope fashion companies should maintain risk-based due diligence programmes even if BAFA report filing is not being processed.
Sources: LkSG; BAFA / BMAS guidance; 2025–2026 amendment process reporting.
Key requirements
- Establish risk management, perform regular risk analyses and adopt preventive / remedial measures.
- Operate a complaints mechanism and keep internal documentation.
- Annual public BAFA reporting obligation is suspended in practice / targeted for repeal; monitor the amending statute.
- BAFA enforcement focus has shifted toward serious violations during the transition.
Who’s affected
Companies with their head office, principal place of business or branch in Germany that meet the employee thresholds, including fashion groups active on the German market.
Timeline
1 January 2023
LkSG applies to companies with generally 3,000+ employees in Germany.
1 January 2024
Threshold expands to generally 1,000+ employees.
Late 2025 – 2026
BAFA reporting paused; amending legislation proceeds; CSDDD transposition planning continues.
How Carbon Trail helps
- Carbon Trail assists fashion brands by guiding them through the LkSG compliance process, from gathering supplier data to ensuring robust sustainability reporting. Our services include:
- Carbon Accounting: Accurate measurement of carbon emissions across the supply chain.
- Product Life Cycle Assessment (LCA): Comprehensive lifecycle assessments to evaluate the environmental impact of products.
- Digital Product Passports: Creation of digital passports that provide consumers with detailed sustainability information.
- Decarbonization Services: Strategies to reduce carbon footprints and enhance sustainability practices.
Frequently asked questions
Can companies stop LkSG due diligence because reporting is paused?
No. Core due diligence duties remain in force. Only the annual BAFA report submission process has been suspended pending amendment.
