Read our latest article on Anti-Money Laundering and Supply Chain Due Diligence Act in Germany. And check out Trustnet.Trade® from Cargodian, our innovative compliance-as-a-service solution for SME www.trustnet.trade
Germany has taken recent strides to ensure all business done within the country is ethical. In October 2020, the federal government passed the Draft Act for the Effective Prosecution of Money Laundering to bring German national law into compliance with the EU’s Sixth Anti-Money Laundering Directive.
In January of 2023, the German Supply Chain Due Diligence Act will come into effect for all German companies with more than 3,000 employees. By January 1, 2024, companies that employ more than 1,000 workers will also have to demonstrate compliance.
Here’s what that means for your business and compliance efforts.
Previous anti-money laundering measures passed in Germany focused on regulatory issues. This included mandatory reporting for suspicious transactions and KYC (know your customer) obligations. New legislation, in line with the 6AMLD, brings a sharper focus on criminality. Money laundering, as defined by the Draft Act, refers to profits obtained through any illegal activity referenced in the German Criminal Code. The Draft Act makes no changes to the existing German Anti-Money Laundering Act (GwG), but it does make prosecuting money laundering significantly easier and contains a penalty framework for those considered “obliged entities” under the GwG.
The German Supply Chain due diligence is aimed at outlawing the use of materials that are produced unethically or cause substantial harm to the environment during their production in German firms. This includes materials that have been produced under unsafe working conditions or with the use of child labour, forced labour, or underpaid labour. Environmental harm can be defined as the production or persistent use of organic pollutants and soil contaminants, air and noise pollution, water pollution and excessive water consumption, and the use or production of mercury and mercury compounds.
Trustnet.Trade® is compliance as a service software developed to specifically handle compliance checks related to both Customer Due Diligence (KYC) and the German Supply Chain Due Diligence Act.
Considering stricter regulations, an automated, comprehensive compliance verification process can allow your business to operate at peak efficiency and with confidence.