Eurometaux

The entity is not opposed to the implementation of mandatory due diligence requirements however call for minimum standards (but do not clarify what minimum standards are)

"""Therefore, Eurometaux strongly believes that responsible and ethical sourcing of metals and minerals should be an essential part of EU policy.""…""...our sector recommends that - in case of a political will to introduce a binding law on due diligence in the EU - an effective and practical system should be created, helping the EU make a real impact on the ground, while avoiding excessive burdens on companies and ensuring a level playing field.""""Incorporate a “smart mix” of minimum requirements plus industry initiatives and incentives: proportionate minimum requirements should be in place in the areas of health and safety, human rights, good governance and environment, and incentives should be granted to frontrunners to opt to go beyond those minimum requirements""""Leverage internationally recognised standards and instruments (such as the UNGPs, OECD Guidance and the 3Ts Supplement for base metals) on how businesses can identify, prevent and mitigate their risks... """"...we believe that: i) clear and well-defined international standards should be embraced as common goals by civil society and businesses; ii) stronger harmonization of existing and future EU regulations is needed for the EU regulatory framework on due diligence to be as coherent and horizontal as possible; iii) caution should be taken and collaboration is needed with respect to defining “Environmental Due Diligence""..."""

The entity is in favour of a regulatory approach towards due diligence.

"""As industry associations / responsible business initiatives, we stand behind the EU’s objective to ensure respect for human rights and the environment through an EU-harmonised regulatory approach to due diligence""""We call for: Full harmonisation and consistency of EU due diligence requirements in sectoral and cross-sectoral policies and legal frameworks, in terms of scope, standards and enforcement modalities to ensure respect of better regulation principles."""

The entity is in favour of a regulatory approach towards due diligence.

"""Re: Companies call for a level playing field on due diligence...... Our associations remain supportive of the proposed directive on corporate sustainability due diligence. However, we call strongly for maximum harmonisation provisions to be introduced into the legal framework so as to ensure a level playing field and avoid further internal market fragmentation. Divergent national legal regimes on due diligence would not only be costly and burdensome for companies of all sizes but, more importantly, risk undermining the achievement of the goals of the legislation in an efficient and effective manner."""

Entity makes some supportive statements, but it is unclear from the overall balance of their position whether they support the level of ambition proposed.

""Eurometaux, the European non-ferrous metal association (link), believes that the recently adopted EU Corporate Sustainability Due Diligence Directive (“CS3D”) could be an important landmark to ensure resilient and ethical supply chains for raw materials. However, this legislation, which adds to existing due diligence legislation under the Green Deal, is particularly ambitious and creates challenging obligations for businesses operating in Europe. As such this can lead to significant market disturbances and be an important hinder to competitiveness. The Draghi Report identifies the EU’s sustainability and due diligence framework as a major source of regulatory burden for companies and will entail a major compliance cost. Clear and consistent guidelines become crucial to streamline implementation and ensure coherent transposition among Member States, easing the excessive regulatory burdens on companies resulting from the complexity of the due diligence requirements of this Directive""

Entity welcomes the proposal of the omnibus package and highlight the benefits of voluntary schemes. Entity supports the simplification of the CSDDD.

""Eurometaux...welcomes the European Commission's (“Commission”) proposal for the First Omnibus Simplification Package, which includes targeted amendments to the Corporate Sustainability Due Diligence Directive (CS3D), the Corporate Sustainability Reporting Directive (CSRD), and the EU Taxonomy Regulation. We view this proposal as a positive step towards reducing disproportionate regulatory burdens, as well as administrative and compliance costs for businesses operating within the EU. The recent fast-tracked adoption of the postponement proposal of the CS3D and CSRD application dates is also a positive development. It will help ensure legal certainty for European businesses and allocate sufficient time and resources for the effective implementation of the Omnibus changes."" ""Our sector has a long experience in using voluntary sustainability and due diligence standards... to promote responsible practices and transparency across the entire value chain... To be effective, the first Omnibus must establish a workable, harmonised and proportionate risk-based approach to human rights and environmental due diligence, address the overlapping requirements in the broader horizontal due diligence framework and ensure a harmonised transposition across Member States to secure the level playing field of European companies.""""...while reducing the regulatory burden... the Omnibus proposal should secure harmonisation of the CS3D and CSRD implementation across EU Member States and a timely transposition.""CS3D:""Recognise the role of Voluntary Standards: The important role of voluntary sustainability and due diligence standards should be recognised across the different EU due diligence legislations...Align with International Standards: The Omnibus amendments should also ensure consistency with internationally recognised standards and principles, such as the OECD Guidelines for Multinational Enterprises (OECD MNE Guidelines), the OECD Due Diligence Guidance and the UN Guiding Principles on Business and Human Rights.""""Monitoring. We welcome the proposed extension under Article 15 of the due diligence policy review cycle from one year to at least every five years. However, Article 15 states that the assessment should also be carried out when a “significant change occurs” or when there are “reasonable grounds to believe that the due diligence policies are no longer adequate or new risks may arise”. Although important new developments would traditionally trigger a reassessment, the new unclear wording of Article15 could lead to frequent and unplanned reassessments, especially in high-risk areas, increasing bureaucratic burdens and costs. More clarification is needed to Article 15 to avoid excessive administrative burden.""

The entity is not opposed to the implementation of mandatory due diligence requirements however call for minimum standards (but do not clarify what minimum standards are)

"""Therefore, Eurometaux believes that responsible and ethical sourcing of metals and minerals should be a core part of EU policy. We support the European Parliament’s and Commission’s recent initiatives to examine closely the issue of Due-Diligence in all supply chains. If there is a political will to introduce binding law, we believe, this decision must create an effective and practical system of EU Due-Diligence, that will result in real impact on the ground.... As such, in the case of a mandatory legislation on due diligence at EU level, we suggest a “smart mix” of minimum standards plus voluntary industry initiatives and incentives for companies."" In response to Q 2: ""Do not know"". Rationale: ""..., we acknowledge that governments have the right to set minimum standards on business practices in the areas of health and safety, human rights, good governance and environment...We also believe, if the EU’s intention is to create a mandatory Due-Diligence system, it must be efficient, implementable, monitorable and credible along the entire value chain... In the case of a mandatory legislation on due diligence at EU level, we suggest a “smart mix” of minimum standards plus industry initiatives and incentives: minimum requirements must be defined, and incentives granted to frontrunners who opt to go beyond."" In response to Q 3: ""Ensuring that the company is aware of its adverse human rights, social and environmental impacts and risks related to human rights violations other social issues and the environment and that it is in a better position to mitigate these risks and impacts; Contribute effectively to a more sustainable development, including in non-EU countries; Levelling the playing field, avoiding that some companies freeride on the efforts of others; Increasing legal certainty about how companies should tackle their impacts, including in their value chain; Harmonisation to avoid fragmentation in the EU, as emerging national laws are different; Other""Q 14: ""Therefore, in the event of a mandatory Due Diligence legislation, our industry recommends:• Minimum requirements should be put in place to enable voluntary initiatives, collaboration and incentives to drive the desired outcomes (i.e. “smart mix”).Q 15: Option 6: ""None of the above"", - calls again for a ""smart mix"" of minimum and voluntary standards, coupled with incentives for ""frontrunners"" that go beyond the minimum standards.Q 17: ""yes"" -DD requirements should apply to third-country companies"

The entity is in favour of a regulatory approach towards due diligence.

"""Eurometaux believes the European Commission’s proposal for a Directive on Corporate Sustainability Due Diligence (CSDD), adopted on 23 February 2022, is an important milestone to strengthen sustainable and responsible sourcing of minerals and metals throughout global value chains""""Eurometaux believes that the proposed text of the upcoming CSDD Directive provides a good initial basis to ensure resilient and ethical supply chains for the raw materials that Europe’s green and energy transitions will increasingly require, including from resource-rich countries. ... greater efforts should be done to ensure the future horizontal due diligence framework is coherent with overlapping EU policies and regulations ... Effective enforcement of the proposed measures by public authorities will be critical to ensuring harmonised and consistent application of today’s multi-layered due diligence requirements and to creating a level-playing field"""we regret that the law was proposed in the form of a Directive rather than a Regulation. Should a form of a Directive be maintained, measures are needed to ensure as uniform transposition of the directive as possible to avoid undesirable consequences such as “due diligence shopping”

While signatories show general support for CS3D objectives, they urge rapid adoption of the postponement measures in the Omnibus package. Their position centres on delaying implementation.

The statement points out that 'Although we stand behind the objectives of the CSRD and the CS3D, any setback in the adoption of the proposed postponement measure would jeopardise the stability and predictability that companies require to plan their long-term investments and compliance strategies'. It also indicates that 'reporting obligations under these laws are considerably resource intensive, often requiring additional headcount and a substantial financial investment. By swiftly postponing requirements set in the CSRD and the CS3D, policymakers can avoid squandering vital business resources'.

By endorsing this joint statement, the entity demonstrates support for the Omnibus Simplification Package designed to lower the level of ambition of the Corporate Sustainability Due Diligence Directive.

"The Corporate Sustainability Due Diligence Directive (“CS3D”), undoubtedly the flagship legislation adopted under the Green Deal, is particularly ambitious in terms of its scope thereby creating challenging and impactful new obligations for businesses with global value chains and in some instances rife unintended repercussions for the real economy in the EU and in third countries. ... the undersigned European associations representing companies and sectors impacted by the CS3D, welcome the European Commission’s intention to put administrative burden relief and simplification at the heart of its agenda"

The entity, through a joint business statement (JBS), shows support while showing some concerns on implementation.

The JBS indicates that: 'European business remains supportive of the objectives of the proposed directive ... and we urge co-legislators to work on a reasonable approach that is manageable for companies in practice'. It also states that 'we strongly call for full harmonization to ensure a level playing field and avoid further internal market fragmentation' and that 'legal clarity is paramount for the success of this initiative'.

Entity supports the simplification HRDD requirements

"Implement thresholds for due diligence obligations: In the event that the EU institutions propose to limit companies’ obligations with respect to due diligence, we suggest looking for thresholds that limit the due diligence obligations to companies with a real impact on the field."

They are calling for company size alignment between the three EU directives, advocating for the narrowest scope of company size. While they are calling for the lowering of standards, and increase in company threshold for the CSRD, not the CSDDD, it still shows support for the weakest approach and does not include companies of all sizes.

"Scope. The first Omnibus package must ensure alignment between the CS3D, CSRD, and the EU Taxonomy, as well as any other relevant due diligence initiatives. Particularly, the CSRD threshold that includes under the scope companies with more than 1000 employees and either a turnover of more than €50 million or a €25 million balance sheet should be aligned with the scope of CS3D and Taxonomy, which both include companies with more than €450 million of turnover."

The entity states SMEs should be excluded from CSDDD, supporting the simplification HRDD requirements

""In case the EU institutions propose to limit due diligence companies’ obligations, we suggest not to looking into thresholds that limit the due-diligence obligations to companies with a real impact on the field. For example, a 5000 employees manufacturer could have less impact on the ground than a 5 employees trading company, so thresholds on number of employees is (for our sector) not the best approach. Purchasing power could be a better threshold.""Q 17: ""yes"" -DD requirements should apply to third-country companies"

The entity is in favour of a regulatory approach towards due diligence.

"""environmental, social and governance (ESG) risks are not limited to big companies operating in those sectors, as they can occur in all value chains and in companies of all sizes. Thus, for due diligence to be effective, we believe that it should apply to the entire value chain in an inclusive way (regardless of sectors and company size but adapted to real risk profiles on the ground)"""Thresholds that limit the due diligence obligations to companies with a real impact on the field""Maintain the identification of companies in the scope of the directive by revenue and employee number thresholds""However, the potential application of the due diligence provisions to SMEs should not be excluded in the future, as due diligence practices evolve and obligations expand to more players, including at the global level. Currently, only 1% of EU companies are covered by the proposal, mostly big companies that are already actively working on showing compliance""Maintain the identification of companies in the scope of the directive by revenue and employee numberthresholds: to ensure a level playing field in the economy, it is very important that both upstream firms (forexample, mining companies) and downstream firms (for example, manufacturers of electric vehicles andelectronic equipment which use metals) are in scope of this directive. The proposed approach will avoidloopholes that would appear if manufacturers were not conducting due diligence (which is the case of theConflict Minerals Regulation)."

The JBS does not oppose the inclusion of SMEs, but calls for safeguards to protect them.

The JBS seem to show support to the inclusion of SMEs, although it reiterates that: "The European economy, included SMEs which will be impacted even if formally out of the scope, need a workable due diligence framework that is drafted in a balanced and proportionate way."

The entity does not offer alternative enforcement mechanisms (if not administrative)

""" In addition, the EU should ensure the enforcement mechanism of mining legislation in resource-rich states, to verify whether legal standards are implemented in practice.""""Ensure enforcement mechanisms are efficient, impartial and transparent, in line with policy objectives and goals. The EU should particularly aim to avoid creating an administrative burden on EU companies which might lead to their withdrawal from the market and replacement by companies from other regions that are not bound by similar regulations. Our sector reaffirms the principles of the burden of proof and the presumption of innocence, which is a norm of international customary law."""

Entity supports the proposal in general terms

"We call for: ""Full harmonisation and consistency of EU due diligence requirements in sectoral and crosssectoral policies and legal frameworks, in terms of scope, standards and enforcement modalities to ensure respect of better regulation principles.""""The European Commission to facilitate engagement between enforcement agencies at Member State level by (for example) establishing an EU-level expert group, to ensure coherent national enforcement."""

Entity supports the proposal in general terms, however is predominantly asking for clarification.

"The European Commission should provide clarifications regarding the applicable supervisory authority for non-EU companies. More clarification is needed on the process for designating a single supervisory authority for non-EU companygroups with multiple legal entities across Member States, each potentially subject to different authorities based on EU turnover. Non-EU groups with entities across the Member States, each under different authorities due to EU turnover, should have a process to consolidate these under one authority for simplicity. To avoid the situation where a non-EU company’s supervisory authority changes from year to year, companies with varying EU turnover across Member States should not have to switch authorities annually."

The entity is in favour of enforcement mechanisms in general terms

"19 a: ""Other"" Explanation: ""The new due diligence legislation should be based on efficient, impartial and transparent enforcement mechanisms, in line with policy objectives and goals. The EU should particularly aim to avoid creating an administrative burden on European companies...""""Furthermore, the sanctions should consider how much the company could reasonably be aware of, how much it could influence and mitigate and how serious the breach was. The appropriate enforcement mechanism must be defined accordingly"""

Entity supports the proposal in general terms

"""Ensure efficient, impartial, and transparent enforcement mechanisms""""Effective enforcement of the proposed measures by public authorities will be critical to ensuring harmonised and consistent application of today’s multi-layered due diligence requirements and to creating a level-playing field.""

The JBS rejects including directors' duties in the Directive.

The JBS states that: 'regulating directors' duties does not belong in a due diligence framework. It will have negative side-effects, including the disruption of existing, well-established governance models of the member states, without added value to the ability of companies to apply effective due diligence'.

Entity ask for guidelines and clarification for engaging with stakeholders and providing remediation. It is unclear from their statements whether they support the level of ambition proposed.

""Guidelines and secondary legislation should clarify the framework for engaging with stakeholders and appropriate measures for providing remediation"" ""Guidelines should provide clarity over what is considered as sufficient exercise of influence and remedy for wrongdoings in the chain of activities for impacts to which a company is ‘directly linked to’ including in situations where companies have exercised reasonable leverage to influence responsible business conduct""""best practices should be made available for monitoring and evaluating the effectiveness of remediation actions""

The entity supports stakeholder involvement across the value chain in general terms.

"Ensure transparency and business confidentiality: transparency, trust and stakeholder-involvement should be ensured across the value chain, to avoid... ii) a potential conflict between data protection laws, employee confidentiality, works councils, competitive concerns and the effective functioning on the company-level grievance mechanism."

Entity seeks to restrict liability duties

Q 19a: "...sanctions should consider how much the company could reasonably be aware of, how much it could influence and mitigate and how serious the breach was. The appropriate enforcement mechanism must be defined accordingly. Also, if a company implements a due diligence plan, respecting the binding content and quality, it should not be held liable – provided that it has identified the risk and taken the foreseen and indicated binding mitigation measures, among which cessation of the supply route is not included. This is in line with the existing FR and NL due diligence laws."

Although the joint statement does not oppose to legal liability, it calls for a more balanced approach

The joint statement indicates that 'Legal liability provisions, including sanctions, need to be balanced, follow legal traditions around breach-damage-causality and truly incorporate the widely accepted principle that due diligence is first and foremost an obligation of means. The complexity of value chains cannot be underestimated when analysing impacts which can have multiple competing causes, players and dynamics. Therefore, companies cannot be made liable for damages they have not -intentionally or negligently - caused'.

Entity requests clarification on civil liability claims against non-EU companies but it is unclear whether they support the level of ambition proposed

"The CSDD is silent on jurisdiction for civil liability claims against non-EU companies. However, our sector fears uncertainties with regard to enforcement, such as identifying the relevant jurisdiction for potential civil liability claims, where they are not caught by the Rome I Regulation."

Entity suggest a different coverage for raw materials despite supporting value chain over supply chain.

"""Avoid loopholes by applying value chain thinking: our sector believes that a responsible sourcing approach in terms of value chain can be promoted through the adoption of a homogeneous and inclusive legislation affecting the entire value chain… Value chain thinking does not mean that upstream economic operators should have endless responsibilities vis-àvis their downstream partners (especially when the downstream sector are not where they would be expected to be in terms of contributing to the costs of due diligence).""""Consider secondary raw materials separately as they are extremely difficult to trace: Secondary raw materials can only be traced until the collection of waste. Due diligence obligations cannot go beyond that point."""

Entity calls for a lowering of standards and and narrowing of scope of CSRD and in doing so shows support for a weaker and limited definition of value chain

"Value chain definitions.The Omnibus proposal does not address the different concepts of value chain in the CS3D and CSRD. The CSRD adopts indeed a broad definition covering operations, products and services, business relationships and both downstream and upstream activities. In contrast, the CS3D introduces the narrower concept of “chain of activities”, focused mainly on upstream processes with limited downstream coverage.To reduce complexities and unnecessary regulatory burdens, the CSRD’s scope should be adjusted to align more closely with the CS3D, enabling companies to implement coherent due diligence systems.""The revised Article 8(2)(b) of the CS3D limits the companies' assessment of actual and potential adverse impacts on their own operations, subsidiaries and direct business partners. It further specifies that additional assessments beyond tier 1 will have to be carried out in case of “plausible information” of adverse impacts in indirect business partners’ operations (Article 8(2a)). While this narrows the scope, the introduction of vague terms, such as “plausible information”, creates ambiguity. More clarity is needed on the concept of “plausible information” to ensure resources are focused on the most severe and likely risks, in line with the OECD’s risk-based prioritisation approach.""Maintain a proportionate Risk-Based Approach: The Omnibus proposal should preserve a strong proportionate risk-based approach. Key provisions in the proposal need additional clarification to be workable for companies.""Risk-based approach...A proportionate risk-based approach should allow companies to prioritise where the greatest risks lie, rather than requiring exhaustive checks on all indirect business partners. Excessive focus on lower-risk tiers can divert resources from addressing the most critical issues, since risk-based due diligence enables a cost-effective focus on where the most severe risks lie. The materiality assessment included in the CSRD should guide companies towards what to actually cover."

Entity supports value chain due diligence in general terms

"In response to Q 2: "" We also believe, if the EU’s intention is to create a mandatory Due-Diligence system, it must be efficient, implementable, monitorable and credible along the entire value chain.""In response to Q 3: ""Ensuring that the company is aware of its adverse human rights, social and environmental impacts and risks related to human rights violations other social issues and the environment and that it is in a better position to mitigate these risks and impacts; Contribute effectively to a more sustainable development, including in non-EU countries; Levelling the playing field, avoiding that some companies freeride on the efforts of others; Increasing legal certainty about how companies should tackle their impacts, including in their value chain; Harmonisation to avoid fragmentation in the EU, as emerging national laws are different; Other""Q 14: ""DEFINITION OF VALUE-CHAINIn order to have a real impact on business practices, the forthcoming legislation should be introduced at value chain level. For example, in the EU Conflict Minerals Regulation, the raw materials in an electronic device are not covered while the same raw materials imported by themselves are. In practical terms, this means that semi-finished compounds (e.g. metals in a subpart of an electronic device), are not covered by due diligence obligations, neither are importers of the complete device obliged to conduct full due diligence. This creates a loophole and undermines the effectiveness of the whole legislation – i.e. processing outside of Europe and importing a more finished product helps to escape the legislation... Thus, the EU due diligence system should cover all economic actors operating in the Single Market, avoiding the creation of loopholes. More specifically, our sector believes that a responsible sourcing approach in terms of the value-chain can be promoted through the adoption of a homogeneous and inclusive legislation affecting the entire value-chain rather than only a part of it.""Q 15: Option 6: ""None of the above"", - calls again for a ""smart mix"" of minimum and voluntary standards, coupled with incentives for ""frontrunners"" that go beyond the minimum standards.Q 17: ""yes"" -DD requirements should apply to third-country companies"

Entity suggest a different coverage for raw materials despite supporting value chain over supply chain.

"""for due diligence to be effective, we believe that it should apply to the entire value chain in an inclusive way (regardless of sectors and company size but adapted to real risk profiles on the ground)"""Consider secondary raw materials separately as they are extremely difficult to trace""Consider secondary raw materials separately: the traceability of the secondary raw materials is extremelydifficult and costly, as a purchaser can no longer determine the origin of the metal once the material has been melted"

The joint statement argues that companies can't focus in all elements of their value chains. It also calls for a reduction of obligations

The joint statement states that 'To ensure that the future Directive is truly consistent with a risk-based approach, widely supported in international instruments in the UN and OECD, companies cannot be expected to focus on every single element of their value chains. The ability to prioritise the identification of and action to address the most salient risks is a necessity that must have a crucial impact on compliance with the due diligence process and its consequences'. It also points out that 'we call for revisiting and shortening the annex to only include those conventions and treaties that create concrete obligations on companies so not to mix up their roles with the one of states'.

The signatories call for avoid the extension of the scope of CS3D during implementation and introduction of guidance on model contract clauses

The statement indicates that 'competitiveness assessment that leads to the new simplification should ensure that upcoming implementing legislation and guidance … are co-developed to address gaps or excessively burdensome provisions, rather than introduce additional layers of complexity or de facto extend the scope of the CS3D'.

Entity seeks to limit the stakeholder engagement duties.

"Stakeholders’ engagement. The revised stakeholder definition in Article 3(1)(n) appropriately narrows the scope to employees of the company, its subsidiaries and business partners, as well as their trade unions, workers’ representatives, individuals, or communities. However, the new definition of “legitimate representatives” still requires clarification, so to ensure companies can identify, with legal certainty, when and how to involve specific stakeholder groups."

Entity states that guidelines and clarifications are needed on multi-stakeholder dialogue and ask for guidance on how companies can make use of existing voluntary due diligence standards. Unclear whether they support the level of ambition proposed.

"" Multi-stakeholder dialogue for assessment and monitoring. Consistent guidelines shall be ensured on the assessment that companies should carry out of their operations and measures to monitor the effectiveness of the due diligence requirements of this Directive.""""The EU Commission should make clear which information companies should provide to carry out a transparent engagement with stakeholders. The European Commission should also provide guidance on how companies can make use of the existing voluntary due diligence standards for the metal sector to ensure meaningful engagement with stakeholders. In addition, guidance should clarify in which cases companies cannot reasonably carry out effective engagement with stakeholders and have to consult further with other experts, and how companies should act if stakeholders are not interested or willing to engage""""Guidelines and secondary legislation should clarify the framework for engaging with stakeholders and appropriate measures for providing remediation. The EU Commission should make clear which information companies should provide to carry out a transparent engagement with stakeholders.""