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Denmark has rejected calls from Germany and France to scrap a planned EU supply chain law that has become symbolic of the bloc’s dilemma between meeting its ambitious climate goals and helping its ailing industry.
“We don’t agree” on abandoning plans to ask companies to monitor, report and take action against forced labour and mitigate the environmental impact of their operations outside the EU, Danish industry minister Morten Bødskov told the Financial Times.
Copenhagen will gain greater policy influence in Brussels when it takes over the rotating presidency of the Council of the EU in July. Denmark is one of the most ambitious countries in the bloc when it comes to adopting green legislation and pushing the EU to go even further than current targets and cut its greenhouse gas emissions by 90 per cent by 2040.
EU member states and the European parliament are currently negotiating the postponement of the supply chain rules, which are a key part of the bloc’s ambitious climate and human rights agenda.
But both Paris and Berlin have called for the law to be repealed altogether, saying the extra reporting requirements will only hurt the bloc’s competitiveness even further at a time when many European industrial sectors are struggling to keep up with Chinese and US competitors.
The CEO of a construction and logistics group that carries out projects in the US and Africa previously told the FT that it had begun to track more than 700 metrics to comply with the supply chain law at a cost of “several million” euros.
Bødskov acknowledged that the EU should look into simplifying the reporting obligations for companies, but insisted that “there are many, many positive sides to it that we have to remember”.
European Commission President Ursula von der Leyen has pledged to cut red tape, including climate-related legislation, to help close the competitiveness gap.
Bas Eickhout, a European lawmaker for the Greens, said the law had already been “heavily butchered” after the commission’s original proposal was heavily watered down and underwent further simplification efforts this year.
The EU’s internal watchdog opened an inquiry this week into the commission’s current attempt to rework the law, after NGOs said that the EU executive broke its own rules by failing to consult or do an impact assessment before proposing the simplification measures.
Implementing the EU’s simplification strategy is a priority for Denmark during its six months at the helm of the Council, said Bødskov, but a part of that debate is also “to remember that the goals were right, but some of it has developed into too much and to difficult to reach the goals.”
Bødskov’s remarks reflect growing concern among some EU countries that the EU’s push for “better regulation” could be used as a vehicle to dismantle green legislation.
“Better regulation is not deregulation, it’s simplification,” he said, to avoid moving Europe away from its climate targets.
“We have to keep the targets, but we have to make it much easier for our companies and businesses to invest in reaching these targets.”
