Response to interpellation 2023/24:447 on the EU directive on corporate due diligence
Translated from Swedish by AI; the translation may contain errors. The Swedish text is the original.
Summary AI, written in advance
KD welcomes the directive's purpose to strengthen human rights and environmental protection 1 and considers the ambition of harmonized EU rules to be laudable 2 3. KD argues, however, that the current text implies too high administrative burdens for small and medium-sized enterprises 1 4 2, which means that Sweden cannot approve it in its current form 1. KD therefore advocates for limiting the scope through raised threshold values 2 and welcomes the Belgian compromise proposal 3. S considers that the government is blocking the bill 5 and that their actions worsen Swedish competitiveness and workers' rights 6 7 8.
Written by AI in advance and may contain errors. The numbers lead to the speech a statement builds on; check against the text below.
Energi- och näringsministern Ebba Busch (KD)
Madam Speaker! Aida Birinxhiku has asked the Minister for Foreign Affairs and Trade if he and the government intend to brake the EU proposal on due diligence for companies in terms of sustainability.
The work within the government is distributed such that it is I who am to answer the interpellation, and therefore it is I who am here today.
The Council, the Commission, and the European Parliament have recently reached a preliminary political agreement on the current proposal for a directive. This was discussed in Coreper on 28 February, but there was not sufficient support among the Member States to approve it at that time.
Sweden has been an active party in the negotiations, and among other things, tripartite negotiations on a final directive text were initiated during the Swedish presidency.
Sweden has for a long time had a high level of ambition in the work for human rights and equality as well as a tightened regulatory framework regarding environmental and climate issues, and the government welcomed the purpose of the directive on corporate sustainability due diligence.
The Government considers that the business community has an important role to play in the work for sustainable development, and for many Swedish companies, sustainability issues are also important from a competitive perspective. Through the directive, it is proposed that companies be subjected to legal liability and sanctions in relation to the risk of negative impact on human rights and the environment. Requirements will be set for companies to identify, monitor, prevent, mitigate, remedy, and stop negative impacts in their so-called chain of activities.
Today, there are national legislations in the area in some EU countries, and the ambition to instead seek harmonized rules at the EU level in order to deepen the internal market is laudable. This would, however, need to be done in a way that limits administrative burdens and ensures that such burdens are proportionate and expedient in relation to the proposal's objectives.
The text that was discussed in Coreper on 28 February cannot be said to live up to that objective and instead risks leading to significantly increased administrative burdens, including - and in the long run - for small and medium-sized enterprises. The consequences for the companies are difficult to oversee. At the same time, it is difficult to draw firm conclusions about the objectives that are desired to be achieved based on the impact assessment that has been prepared.
Against this background, the Government considers that the scope and obligations of the directive should have been more limited - and overall that the text is too far from Swedish positions to be approved. Sweden thus belongs to the group of Member States that have not given their support for an approval of the text. In the event that it becomes relevant to take a final position, Sweden will vote no.
Since then, the Belgian presidency has submitted an updated version, which is being analyzed at the Government Offices and which we will have reason to return to.
Aida Birinxhiku (S)
Madam Speaker! Thank you, Minister, for the answer! Let me begin with the background to why this bill was presented.
In many markets today, violations of human rights, damage to the environment and climate, and weak labor law protection are common occurrences. There are far too many people who work under life-threatening conditions, who are forced into child labor, and who endure threats and harassment because they choose to organize unionally. Therefore, large parts of the business community, civil society, and the trade union movement have demanded clear legislation on corporate responsibility. Voluntary guidelines have proven to be insufficient. And clear rules of the game have been demanded, not least by Swedish companies.
The Minister has himself noted that the business sector plays an important role in the work for sustainable development and that Swedish companies are at the forefront. But today, they are forced to compete on unfair terms with companies that do not make the same priorities. They want to see a common regulatory framework that ensures that it shall not be a competitive advantage to evade responsibility for human rights, the environment, and climate. Having harmonized rules in this area instead of a patchwork of national rules contributes to competition neutrality and legal certainty for the companies.
Madam Speaker! It is against this background that the EU Commission has presented its proposal for a directive on what is called due diligence. Just as the Minister mentioned, a political agreement was reached in the middle of December last year.
Now, however, the entire directive seems to be hanging by a thread. The Swedish government appears to be backing out of the agreement at the last moment, and Sweden is the only EU country that has explicitly signaled that it intends to vote no to the legislative proposal. It is a stance that weakens Swedish competitiveness, which jeopardizes Swedish jobs and which weakens the protection of workers' rights. It is also a stance that has not been anchored in the Riksdag.
Madam Speaker! We Social Democrats agree that the directive should not entail disproportionate costs or administrative burdens for companies. However, we do not agree that the directive should be as toothless as possible, and we definitely do not agree that Sweden should contribute to the defeat of the entire directive.
In the current situation, the government continues to block the bill while the European Parliament elections in June are beginning to approach. Postponing the decision until after the election involves a great risk that it will take several years before we have legislation in place. In the worst case, there will be no new legislation on corporate responsibility, which would be deeply regrettable.
Madam Speaker! The Belgian presidency, in consultation with the parliament, has worked on the proposal in order to be able to gather a majority of the EU countries. The member states were to take a position on the new, reworked proposal on Friday, but the vote was postponed. Now a new vote is awaited. It will probably be the last chance to get this legislation through before the parliamentary election. Therefore, I hope that Minister Ebba Busch can give us a clear statement in this debate: Will Sweden vote for the new reworked proposal and ensure that we get this EU legislation in place?
Matilda Ernkrans (S)
Madam Speaker! I want to join in what my Social Democratic colleague has already presented here in the Speaker's chair, but from the perspective of the mandate that has been given and which the government has taken from the Riksdag's EU Committee. My question is actually quite simple: How does Minister Ebba Busch view democracy and democratic anchoring?
The Government has, in fact, anchored a mandate in the Riksdag to say yes to Swedish companies' competitiveness, workers' rights, environmental protection, and human rights. But the mandate to say yes to this has, in Ebba Busch's circus-like maneuvers, instead become a mandate that makes Sweden the country that says no, no, and again no - which procrastinates, delays, and worsens for Swedish companies' competitiveness, workers' rights, environmental protection, and human rights.
With what view of democracy and democratic anchoring did Ebba Busch end up there? How did a yes become a no?
Energi- och näringsministern Ebba Busch (KD)
Madam Speaker! I would like to point out a few things so that there is no confusion of terms here. I will start at this end: It is not the case that the Swedish government stands behind the purpose of the directive.
We know that even today, in Sweden and within the entire European Union, goods such as clothes, food and parts of things we use every day - things for our cars and electric cars and parts that are crucial for our green transition, that is to say all that which we want to be able to stand behind - are traded, where the path to the product has been anything but sustainable and morally justifiable.
We know that there is a high risk that children have been involved and that there is a high risk that people are being exploited under some of the most horrific conditions and situations. Therefore, this directive is so important, and therefore it was something that the Swedish presidency actively worked to move forward.
We have not voted on the issue in Coreper in Brussels so far, but several countries have signaled their position. We believe that the proposal, compared to the version we were previously prepared to give our support to, has shifted - that it has moved in a direction that risks becoming counterproductive and which involves a high risk that larger companies eliminate and remove smaller actors in their value chains in order not to be excluded from trade further ahead.
We then risk a situation where, instead of more countries rising out of poverty – where more women are given the opportunity to stand on their own feet and provide for themselves and where more are given the opportunity to trade with the rest of the EU – more are excluded from the value chains. That is why, for example, the question of threshold values has been a major discussion.
The government anchored a Swedish position in the Riksdag in November 2022, and it is the one we have worked from. Now, thankfully, we have received a new proposal from Belgium, and it is something we are looking at and working with. Depending on where the proposal leads, we will review whether there is a need to anchor a new position in the Riksdag, and in that case, we will do so in the near future. There is, for example, a meeting scheduled with the Committee on Industry in the near future. However, we have acted from the position that is anchored in the EU Committee, and we have done everything to follow that.
Regarding the question that Birinxhiku asked, we are now looking at and analyzing the compromise proposal that the Belgian presidency has put forward, and our hope is to find a way forward in order to be able to bring the directive to the next stage.
Aida Birinxhiku (S)
Madam Speaker! I thank the Minister for the answer.
I want to state once again that the Minister and I agree that the requirements placed on companies shall be clear, proportionate and appropriate. Consideration shall be taken of the conditions for small and medium-sized enterprises, and they shall also receive support to manage risks and requirements for increased vigilance, as appears from the bill.
The Minister and I, however, do not agree on risking that three years of work to achieve this legislation is lost and that we therefore do not get any new legislation in place at all. That is, in fact, what the Swedish government's actions risk leading to. It is also why it has met such strong criticism from large parts of the business community, civil society, and the trade union movement, which cannot have escaped the Minister's notice.
Madam Speaker! It cannot have escaped the Minister that the government's changed position on rejecting the directive in its entirety lacks any grounding in the Riksdag. When the issue was subject to deliberation in the Riksdag, the government was given a mandate to support a general guideline in the Council and continue to push for a directive that as closely as possible corresponds to Swedish positions. The government has no mandate to reject the directive in its entirety, and the Minister knows this very well.
There is much to remark on in the Minister's latest response, but let me summarize it like this: The Minister and her colleagues can continue to speak warmly about sustainability issues and about Swedish companies being at the forefront, but when it actually comes down to it, the government does not seem to want to do anything. Sweden has gone from being a role model to being a brake, and the government has actually, ever since it took office, tried to dilute, oppose, and now also block the bill – a proposal that has long been requested in Sweden.
Just a few months ago, Madam Speaker, Sverigedemokraterna members of parliament wrote debate articles about how no one wants to talk about the workers who are subjected to violations of their human rights and who are exploited when the economy shifts - but when we do, it is met with deaf ears. When it actually comes down to it, neither Sverigedemokraterna nor the government stands on the workers' side.
Madam Speaker! It is still my hope that the Belgian presidency will succeed in gathering a majority of the EU countries behind the directive, but time is running out. The European Parliament elections are approaching, and as previously mentioned, the Belgian presidency has presented a reworked proposal that the member states are now to take a position on.
Therefore, I want to repeat the question to the Minister to which I did not quite receive an answer: Will Sweden vote for the new proposal and ensure that we get this EU legislation in place, or is the purpose of calling for a new deliberation in the Committee on Industry to allow the government to defeat the directive in its entirety?
Matilda Ernkrans (S)
Madam Speaker! It is absolutely reasonable to demand that the Minister answer our questions. It may have shifted and moved in all possible different kinds of directions, but the fact remains: The only mandate that Ebba Busch and the government have democratically anchored in Sweden's Riksdag is the mandate to say yes - and even to say yes if the negotiations might have moved in a better direction, with stronger protection for workers' rights, environmental protection, and human rights. No mandate has been given to the Swedish government and Ebba Busch to reject this proposal or directive in its entirety. No such mandate has been given.
It is absolutely reasonable that the Minister responds to our legitimate questions. How is it that the democratically anchored mandate for a yes has become a no? What does that show regarding Ebba Busch's view of democracy? How does the government intend to act? There is not a single mandate given from anywhere in this Riksdag to reject the proposal, and that is how the government is now acting at the EU level. Answer the questions, Ebba Busch!
Energi- och näringsministern Ebba Busch (KD)
Madam Speaker! I want to emphasize that I answered both Members of Parliament in my previous post. First and foremost, it is about the fact that we are currently looking at the compromise proposal that the Belgian presidency has put forward, and we will therefore return when we have finished looking at the proposal. We are prepared if there is a need to anchor with the Riksdag in accordance with how this country is governed, in accordance with how a government may act in an EU context on the mandate of the Riksdag.
To Matilda Ernkrans, who is sitting there shaking her head, I want to read aloud what we anchored in the EU Committee in November 2022. I highlight a number of points in the Swedish position that are anchored in the EU Committee - for those listening to this. I therefore cannot, in an EU context, pursue any line other than the one anchored in the Riksdag.
We have received support for a Swedish position which, among other things, concerns that the ambition to create harmonized EU rules in the area, instead of the patchwork of national rules that is emerging in the area, is laudable – that is to say, we are fundamentally in favor of it. However, it needs to be done in a smart way and in a way where the administrative burdens that the directive gives rise to are in proportion to the problems that the proposal aims at. Consequently, the government is critical of parts of the Commission's proposal for a directive on corporate sustainability due diligence. It is problematic that the directive could risk leading to significantly increasing administrative burdens for the companies concerned, including for small and medium-sized enterprises, with which companies covered by the directive have an established business relationship.
Then I come to a key sentence that I want to emphasize: In order to limit these burdens, the government argues that the scope and obligations of the directive should be significantly limited. The government considers that the threshold values for number of employees and turnover should be raised so that fewer companies are covered by the directive - and so on.
It is in accordance with this that we have acted since then, and if there is reason to anchor a new position, for which we are prepared - we do not yet know what the government's proposed position will be - if there is reason to request a new mandate or an adjusted mandate based on the compromise proposal currently on the table from the Belgian presidency, we will, of course, return to the Riksdag.
Aida Birinxhiku (S)
Madam Speaker! I thank the Minister for the debate.
Sweden has long been a role model in the work for human rights, the environment, and the climate. Therefore, I can do nothing but regret that the government is actively pushing to prevent this legislation from becoming a reality. That position is not anchored in the Riksdag. It is a position that weakens the protection of workers' rights, and it is a position that jeopardizes Swedish competitiveness and Swedish jobs.
Madam Speaker! We could spend the entire debate talking about how the business community plays an important role in the work for sustainable development. But after a while, it is time to move from words to action. That is when the government chooses to back down.
The government's actions mean that three years of work to achieve this legislation risk being lost. In the worst case, there will be no common EU legislation on corporate responsibility. But it is my hope that the government takes to heart the criticism that this action has caused. Instead of blocking the bill, the government should do its utmost to reach a compromise and ensure that the legislation becomes a reality. It would strengthen Swedish competitiveness, Swedish jobs, and the protection of people and the environment. I hope that is the government's starting point when a new deliberation is potentially called in the Committee on Industry.
Energi- och näringsministern Ebba Busch (KD)
Madam Speaker! I begin by underlining that the government's position is that the directive is fundamentally good. I understand that we agree on this broadly across the party lines, that is to say, that it is the line that we have a mandate to put forward in an EU context based on what has been anchored in both the committee and the EU committee.
Several member states, including Czechia, France and Italy, have been reported to be negative towards the text from 28 February. Germany and Austria as well, two governments where green parties are included, have reported that they intend to abstain. We, of course, have a close dialogue with them.
The Swedish government is doing what we can to act constructively and to find ways forward. We welcome the compromise proposal that has come from the Belgian presidency, and we do not take the issue lightly. We are now looking at what is a reasonable position, what we believe is a reasonable way forward, and whether a potentially adjusted position needs to be anchored based on the Belgian proposal.
But I want to emphasize that the proposal is not as black and white as some make it sound. It has not sounded that way in the chamber, but I have seen some of the media discussions. European companies' opportunities to do business with poor countries, and the EU's opportunities to trade with them, risk being hindered if we do not land correctly. This means that the relatively privileged European Union contributes to raising the boundaries for more countries to lift themselves out of poverty, for more countries to be able to trade with the EU. It is that balancing act we want to achieve. That is what I am still working on from the mandate of the Riksdag.
Source: The Swedish Parliament. The speeches come from the open data of the Riksdag, translated into English by AI, which may contain errors.