# German Supply Chain Act: The Supplier Evidence Pack > Source: https://surajmal.com/blog/2026/02/german-supply-chain-act-apparel-suppliers [SSL Newsroom](/blog) Compliance # The German Supply Chain Act: What It Asks of an Apparel Supplier Kolkata · 17 FEBRUARY 2026 ·By Surajmal Editorial Team·10 min read Published 17 February 2026 A German buyer sends a supplier questionnaire, a code of conduct to countersign and a request for audit reports covering every unit that touches the order. Somewhere in the covering email is the abbreviation LkSG. The question a supply team then has to answer is narrow: what is actually being asked for, and what does the evidence look like when it is complete. The short answer is that the Act does not reach a supplier abroad directly. It regulates the company in scope in Germany, and that company passes its duties down through the contract. A supplier that itself has a German seat or a German branch and meets the threshold is a company in scope in its own right, which is a different question from being someone else's supplier. Reading the statute the right way round is what turns an open-ended compliance demand into a finite list of documents. ## Who does the German Supply Chain Act actually bind? The Lieferkettensorgfaltspflichtengesetz applies to companies, whatever their legal form, that employ at least 1,000 people. How those people are counted depends on where the company sits. For a company whose head office, principal place of business, administrative seat or registered office is in Germany, the count is of its employees generally, and employees posted abroad are included. For a company based outside Germany, the route in is a German branch, and there the count is of employees in Germany. That threshold has applied since 1 January 2024; before that it was 3,000. Agency workers count where the placement runs beyond six months, and within a group the staff of German group companies count towards the parent. Two things have changed around the Act that a buyer's request may not mention, and neither changes what the evidence pack has to contain. Supervision was wound back first. Following a draft amending law approved by the Federal Cabinet on 3 September 2025, the Federal Office for Economic Affairs and Export Control stopped reviewing company reports under sections 12 and 13 with effect from 1 October 2025. The draft was approved by cabinet, not enacted, and the due diligence duties in the Act are unchanged. Scope is set to narrow next. In its coalition committee paper of 2 July 2026 the Federal Government stated that it will transpose the EU due diligence directive one to one, and that legislation in autumn 2026 will restrict the Act to companies with at least 5,000 employees and a worldwide annual net turnover above 1.5 billion euro, with the duties themselves recast on a risk basis. That is a stated government plan, not law. Until it is enacted the threshold in force is the one above. For a supplier none of this changes the ask. Buyers are still requesting the same evidence, because the obligation they are managing is their own and a contract signed under the current threshold runs on regardless. Treat the evidence pack as live. Every duty in the Act is addressed to that company. A garment supplier in India, Bangladesh or anywhere else outside Germany is not a regulated person under the statute and has no filing, no registration and no direct obligation to the German authorities. What the supplier has is a contract with a company that does. That distinction matters commercially. A supplier who reads the Act as though it applied to them tends to over-promise: to accept language about the whole chain, to warrant conditions at a spinner two tiers away, to sign up to audits nobody has scoped. A supplier who reads it correctly negotiates the clause on its own terms and then delivers exactly what the clause says. ## What does the Act require a buyer to do about its direct suppliers? The in-scope company has to run a risk management system and, within it, an appropriate risk analysis covering its own business area and its direct suppliers. Where that analysis identifies a risk, it must put preventive measures in place without delay. For direct suppliers the Act names four preventive measures in particular: 1. taking human-rights and environmental expectations into account when selecting a direct supplier; 2. obtaining a contractual assurance from the direct supplier that it will meet those expectations and address them appropriately along its own chain; 3. delivering training and instruction to give effect to that contractual assurance; 4. agreeing appropriate contractual control mechanisms, and carrying them out on a risk basis, to verify that the human-rights strategy is being followed at the direct supplier. The effectiveness of these measures has to be reviewed once a year, and again whenever the risk picture changes materially, for instance through a new product, a new project or a new business field. Those four items are the whole of what the statute asks a buyer to build around a direct supplier. Read as a supplier's to-do list, they translate into: expect to be assessed before you are nominated, expect to sign something, expect to be trained or to train your own people, and expect to be checked. The buyer's duty What it looks like on the supplier's side The record it produces Supplier selection A questionnaire, a site visit, a request for existing audit reports The completed assessment and its attachments Contractual assurance A code of conduct or a due-diligence annex to the supply agreement The countersigned document, dated Training A session for line supervisors, HR or the compliance contact Attendance record and materials Contractual control A social audit, an announced or semi-announced visit, a corrective action plan The audit report and the closure evidence Annual effectiveness review A refreshed questionnaire or a re-audit on the buyer's cycle The current-dated version of each of the above ## What lands in the supply contract The clause a supplier signs is usually shorter than the Act and broader than the Act. That gap is where most of the negotiation sits. Three drafting habits are worth watching. The first is a warranty covering the entire upstream chain, which no supplier can verify to the standard a warranty implies; the workable version is a commitment to pass the expectations down and to cooperate on any specific concern raised. The second is an open-ended audit right with no notice period, no scope and no cost allocation; a defined protocol, a named or approvable auditor and an agreed frequency is the version that can be planned. The third is a termination trigger on any finding at all, which in practice punishes the transparency the Act is trying to create; the statute itself treats ending the relationship as a last resort and expects a remediation plan first. None of this is exotic. It is the same negotiation a buyer's own legal team has already had internally, and asking for the specific version of a general obligation is normal supplier conduct, not resistance. ## What does an evidence pack for a German buyer contain? The useful thing about the four preventive measures is that each one produces a document. Assemble the documents and the pack is complete, whatever the questionnaire looks like. In practice a pack for a garment programme runs to five groups: Group Typical contents Refresh cycle Social audit A current audit report against the buyer's chosen protocol, with the corrective action plan and its closure evidence Annual, or per the protocol Management system Quality management certification and the internal procedure documents it rests on Per the certification cycle Materials Fibre and chemical certification covering the materials used on the programme, with transaction documents where the scheme requires them Per shipment or per season Testing Restricted-substance and physical test reports for the specific order Per order Contractual The countersigned code of conduct, the due-diligence annex, and the record of any training delivered On signature, then on renewal A supplier that keeps these current answers most buyer questionnaires by attachment rather than by narrative. That is worth more than it sounds: a compliance function reading fifty supplier responses is looking for a dated document, and a paragraph explaining that the document exists is not the same thing. ## How do social audits fit the four preventive measures? They sit under the fourth one, the contractual control mechanism, and they sit there imperfectly. An audit is a point-in-time sample of a site against a checklist. It is evidence that a check happened and evidence of what was found; it is not a guarantee of conditions on a day nobody was there. Buyers know this, which is why the follow-up matters more than the grade. A finding that was raised, remediated and verified is a stronger signal than a clean report, because it shows the control loop closing. The corrective action plan, with dates and closure evidence, is the part of an audit file that a due-diligence review actually reads. Where a buyer has its own protocol, the sensible course is to run to that protocol instead of arguing for an equivalence. Where the buyer accepts a recognised third-party scheme, the report and its follow-up documents travel across programmes and the same file serves several customers. Our note on [how BSCI, Sedex and WRAP compare](/blog/2026/07/bsci-sedex-wrap-social-audits-compared) sets out what each one evidences and what it does not. ## Where indirect suppliers come in The Act treats indirect suppliers differently from direct ones. Duties towards a sub-supplier are triggered on an event basis, when the company obtains substantiated knowledge that a violation at an indirect supplier appears possible. At that point it must, without delay, carry out a risk analysis, embed appropriate preventive measures towards the party responsible, draw up and implement a concept to prevent, end or minimise the issue, and update its policy statement if needed. For a garment supplier this is the mill, the dyehouse, the trims vendor and, further back, the spinner and the farm. Nothing in the Act asks for a routine audit of every one of them. What it asks for, once something specific surfaces, is the ability to say who made the fabric and where the fibre came from. That capability is worth building before it is requested, because it takes a season to build and an afternoon to demand. A materials register that ties each purchase order to a mill, a dye lot and a certification transaction document is the difference between a two-day answer and a two-month one. Our note on [the traceability gap](/blog/2026/05/traceability-gap) covers where the trail usually breaks and what closes it. ## What the Act does not do Three limits are worth stating plainly, because supplier questionnaires often imply otherwise. It does not create a certificate. There is no LkSG stamp, no approved-supplier register and no body that issues a compliance mark. Anyone selling one is selling a service, not a status. It does not create civil liability of its own. The statute says in terms that a breach of the duties it imposes does not found civil liability, while liability arising independently of the Act is unaffected. It does not require zero risk. The duties are duties of effort, measured by the nature and scale of the business, the company's ability to influence the party concerned, the expected severity and reversibility of the harm, and the company's own contribution to it. A supplier who reports an issue with a plan attached is behaving the way the statute expects. ## How does this sit alongside the EU directive? The EU Corporate Sustainability Due Diligence Directive, adopted in 2024, was amended in February 2026. The amendment raised the size thresholds, and the test differs by where a company is incorporated: an EU company is in scope with more than 5,000 employees and more than 1.5 billion euro of net worldwide turnover, both together; a company from outside the EU is in scope on more than 1.5 billion euro of net turnover generated in the Union, with no employee threshold. Member states transpose it by 26 July 2028 and companies in scope apply it from 26 July 2029. Two things follow for a supplier. The directive is a higher threshold than the German statute, so a buyer in scope of the German Act is not automatically in scope of the directive. And the mechanism is the same: the obligation sits on the company in scope, and it reaches a supplier through contractual assurances. Whatever changes in the drafting, the supplier-side answer stays a current audit file, a materials trail and a countersigned commitment. ## What to have ready before the questionnaire arrives Keeping the pack current is a scheduling problem more than a compliance one. Audits expire, certification scopes lapse, and a report that was current at nomination is often out of date by the first shipment. Item Common failure The fix Audit report Expired between nomination and bulk Diary the re-audit against the production window, not the calendar year Corrective actions Closed but the evidence was never filed File the closure proof with the report, in the same folder Certification scope Covers the site but not the process on this order Check the scope against the actual construction at development Materials trail Mill known, dye lot not recorded Record the dye lot with the purchase order, not at shipment Signed code of conduct Superseded by a new version nobody countersigned Re-sign on renewal, and keep the dated set For programmes going to Germany specifically, the label and the document set carry their own national requirements alongside the due-diligence ones. Those are set out on the [Germany import guide](/markets/germany). ## FAQ **Does the German Supply Chain Act apply to a supplier outside Germany?** No. It binds companies with their seat or a branch in Germany that meet the employee threshold. A supplier outside Germany is reached through the supply contract, not through the statute. **Is there such a thing as an LkSG certificate?** No. The Act creates duties for the in-scope company and no certification scheme. Evidence takes the form of audit reports, certification records, testing and signed contractual commitments. **How many employees does a German company need before the Act applies?** At least 1,000, a threshold that has applied since 1 January 2024. For a German-seated company the count includes employees posted abroad; for a foreign company reached through a German branch it is 1,000 employees in Germany. Within a group, the German employees of group companies count towards the parent. **Does the Act require auditing every mill and spinner?** No. Duties towards indirect suppliers arise on an event basis, when the company has substantiated knowledge suggesting a violation is possible. Routine due diligence is directed at direct suppliers. **What is the single most useful thing to keep current?** The social audit report with its corrective action plan and closure evidence, dated and complete. It answers the largest part of most questionnaires and it is the item that most often expires unnoticed. 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Every article is reviewed by practitioners who source, sample, and ship the products they write about. On this page - [Who does the German Supply Chain Act actually bind?](#who-does-the-german-supply-chain-act-actually-bind) - [What does the Act require a buyer to do about its direct suppliers?](#what-does-the-act-require-a-buyer-to-do-about-its-direct-suppliers) - [What lands in the supply contract](#what-lands-in-the-supply-contract) - [What does an evidence pack for a German buyer contain?](#what-does-an-evidence-pack-for-a-german-buyer-contain) - [How do social audits fit the four preventive measures?](#how-do-social-audits-fit-the-four-preventive-measures) - [Where indirect suppliers come in](#where-indirect-suppliers-come-in) - [What the Act does not do](#what-the-act-does-not-do) - [How does this sit alongside the EU directive?](#how-does-this-sit-alongside-the-eu-directive) - [What to have ready before the questionnaire arrives](#what-to-have-ready-before-the-questionnaire-arrives) - [FAQ](#faq) START A CONVERSATION ## Ready to source with _confidence?_ Send a brief and we'll reply within 24 hours, with a first sample in 4 to 10 days. 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