US life-sciences groups carry a settled model of supply-chain human-rights law, and it is a customs model. Section 307 of the Tariff Act of 1930 bars goods made with forced labor at the port. The Uyghur Forced Labor Prevention Act (UFLPA) turns that bar into a rebuttable presumption for anything made wholly or in part in Xinjiang, and section 1502 of the Dodd-Frank Act asks issuers to disclose their conflict-minerals due diligence to the SEC.119 U.S.C. § 1307; Uyghur Forced Labor Prevention Act, Pub. L. No. 117-78, § 3; 15 U.S.C. § 78m(p). The state acts at the border or through the annual report, and a company risks a detained shipment or a deficient filing. Europe has built something else. The EU's Corporate Sustainability Due Diligence Directive, narrowed in February 2026 by the Omnibus I Directive, imposes an affirmative duty of conduct on the company itself, supervised by an administrative authority, sanctioned on group turnover and backed by national tort law. Germany already runs a version of that model and is dismantling parts of it. Switzerland already runs a narrower one and put a much wider draft out for consultation in April 2026. A pharmaceutical or medical-device group with a German subsidiary, a Swiss subsidiary and EU sales above the new threshold can be inside all three. The three do not agree on who is caught, how far down the chain the duty runs, who enforces it, or whether anyone can sue.
1. The CSDDD's Due Diligence Duties After the 2026 Amendments
The CSDDD, Directive (EU) 2024/1760, has been in force since July 2024 and has been amended twice before applying to anyone. The stop-the-clock directive of April 2025 moved its transposition deadline and first application date by a year. The Omnibus I Directive, Directive (EU) 2026/470, published in the Official Journal on 26 February 2026 and in force since 18 March 2026, rewrote its scope. Art. 2(1)(a) CSDDD as amended reaches EU companies with more than 5,000 employees and a net worldwide turnover above EUR 1.5 billion, and Art. 2(1)(b) CSDDD reaches the ultimate parent of a group that meets those figures on a consolidated basis. Art. 2(2)(a) CSDDD reaches a company formed under the law of a third country, the United States or Switzerland included, if it generated a net turnover above EUR 1.5 billion in the Union in the financial year preceding the last financial year, and Art. 2(2)(b) CSDDD reaches the ultimate parent of a group that did so on a consolidated basis. Art. 2(5) CSDDD requires the condition to be met in two consecutive financial years.2Directive (EU) 2024/1760 (CSDDD), as amended: Art. 2, Art. 3(1)(f) and (g), Art. 5(1), Art. 6(1), Art. 23, Art. 24(3), Art. 37(1). The thresholds were 1,000 employees and EUR 450 million until March 2026. The Omnibus recital that raised them says the directive can best achieve its objectives as regards the very largest companies.3Directive (EU) 2025/794 (stop-the-clock), Art. 2; Directive (EU) 2026/470 (Omnibus I), recitals 37, 41, 49, Art. 4 to Art. 6. For a US group the employee count is irrelevant and the only question is EU revenue, measured in an accounting year that is not the last one, over two years, at group level. The first two questions are which entity in the group is the company and whose financial years the count runs on. The directive answers them with nothing more than the terms "ultimate parent" and "consolidated basis."
What the directive then asks of that company is conduct, not disclosure. The actions Art. 5(1) CSDDD lists are integrating due diligence into policies and risk management, identifying and assessing actual and potential adverse impacts, preventing and mitigating potential ones, bringing actual ones to an end, remediating, engaging with stakeholders, running a notification mechanism and complaints procedure, monitoring, and publishing an annual statement. Art. 25 CSDDD gives a national supervisory authority the power to order the company to cease conduct, to refrain from repetition and to provide remediation, and to impose penalties. Art. 27(4) CSDDD as amended requires Member States to set the maximum pecuniary penalty at 3 % of net worldwide turnover, calculated at the level of the ultimate parent where the parent is the company in scope. The original text had instead set a floor for that maximum: it was to be not less than 5 %. Penalty decisions are published for at least five years under Art. 27(5) CSDDD.4CSDDD (n 2), Art. 25(5), Art. 27(4) as amended (3 % cap; originally a floor of not less than 5 %), Art. 27(5), Art. 36(2). A third-country company must designate an authorized representative in a Member State under Art. 23 CSDDD. Its supervisory authority is, under Art. 24(3) CSDDD, that of the Member State where it has a branch or, failing one or with several, where it generated most of its EU turnover. None of this has an equivalent in section 307 of the Tariff Act. The EU's actual counterpart to the US import ban is a different instrument, Regulation (EU) 2024/3015, which prohibits products made with forced labor on the Union market and applies from 14 December 2027.5Regulation (EU) 2024/3015 (forced labor products), Art. 3, Art. 39. A group that maps the CSDDD onto its UFLPA program has mapped the wrong instrument.
The one thing the Omnibus removed outright is the part US counsel would have recognized. The original Art. 29(1) CSDDD created an EU-wide civil liability of the company for damage caused by an intentional or negligent failure to prevent or end adverse impacts. Art. 29(7) CSDDD required the transposing rules to be of overriding mandatory application where the law governing the claim was not that of a Member State. Both are deleted. Five paragraphs remain, and three of them matter here. Under Art. 29(2) CSDDD as amended, where a company is held liable under national law for damage caused by a failure to comply with the directive's requirements, the injured person has a right to full compensation. Art. 29(3) CSDDD keeps the five-year minimum limitation period, the rule that the cost of proceedings must not be prohibitively expensive and the court's power to order disclosure of evidence in the company's control. Art. 29(4) CSDDD adds that a company which used industry initiatives, third-party verification or contractual clauses may nevertheless be held liable in accordance with national law.6CSDDD (n 2), Art. 29 as amended; Omnibus I (n 3), recital 49; Regulation (EC) No 864/2007 (Rome II), Art. 4(1), Art. 7, Art. 16. The Omnibus recital explains that the Union-wide regime was removed to better achieve subsidiarity, and adds that nothing stops a Member State from declaring its own transposing rules overriding mandatory provisions under the Rome II Regulation. Liability survives, but in twenty-seven national tort systems and under the choice-of-law rules of Rome II. Under Art. 4(1) Rome II, a claim in an EU court for harm at an Indian production site is governed by the law of the place where the damage occurred. There are two exceptions: for environmental damage the claimant may elect the law of the place of the causal event under Art. 7 Rome II, and the forum may apply its own overriding mandatory rules under Art. 16 Rome II. Which Member States take up the recital's invitation decides whether the deletion means anything, and none had at publication.
The regime most US groups have actually read, the German one, is being dismantled. The one they have not read already applies in Switzerland. And the one they are waiting for has become smaller in scope and larger in what it leaves to national law.
2. The CSDDD's Chain of Activities in Pharmaceutical Supply Chains
The directive does not use the word supply chain. Art. 3(1)(g) CSDDD defines a chain of activities upstream as the activities of business partners related to the production of goods or the provision of services by the company, including the design, extraction, sourcing, manufacture, transport, storage and supply of raw materials, products or parts of products and the development of the product or the service. Downstream it covers the activities of business partners related to the distribution, transport and storage of the company's product where the partners carry out those activities for the company or on behalf of the company. Art. 3(1)(f) CSDDD then divides partners into direct ones, with which the company has a commercial agreement, and indirect ones, which perform related business operations without one.2 For a pharmaceutical group the upstream limb is the whole of the manufacturing map, meaning the active-ingredient and intermediate sites, the contract manufacturers, the excipient, glass and packaging suppliers, and the logistics providers that move material between them. Where that manufacturing takes place, and how much of it sits in a small number of Asian sites, is covered in the analysis of environmental risk assessment along the pharmaceutical supply chain. The downstream limb is narrower and turns on the words "for the company or on behalf of the company." A contract-logistics provider warehousing finished product for the company is inside it. A wholesaler that buys the product and resells it in its own name is, on the text, distributing for itself. Where a distribution agreement sits on that line is a drafting question with a regulatory answer.
What the company must look for in that chain is set by the Annex, and the Annex is longer than the forced-labor and child-labor prohibitions a US program is built around. Part I of the Annex CSDDD lists, among others, the right to just and favorable conditions of work including a living wage, the prohibitions of child labor and of forced labor, freedom of association, and, in point 15, the prohibition of causing any measurable environmental degradation, such as water pollution or excessive water consumption, that harms a person's health or denies access to safe drinking water. Part II opens with the obligation to avoid adverse impacts on biological diversity, interpreted in line with the Nagoya Protocol on access to genetic resources and benefit-sharing.7CSDDD (n 2), Annex Part I points 6, 9 to 11, 13 and 15, Part II point 1, Art. 3(1)(b); Regulation (EU) No 511/2014, Art. 4(1). Each of those has a life-sciences address. Point 15 describes an antibiotic-manufacturing effluent problem without naming it. The Nagoya obligation already binds EU users of genetic resources directly under Art. 4(1) of Regulation (EU) No 511/2014, but the CSDDD turns it into something the group must look for in its partners' operations as well as its own. That is a different exercise for a biotech whose strains came in through a dozen collaborations. Whether an environmental impact counts at all is defined by Art. 3(1)(b) CSDDD by reference to those Annex provisions and to the national legislation linked to the instruments listed there, so the standard is partly the law of the place where the supplier sits.
How Deep to Look and How to Respond
The Omnibus did its most consequential drafting on how deep the company must look. Art. 8(2) CSDDD as amended prescribes two steps. The first is a scoping exercise, based solely on reasonably available information, to identify the areas across the company's own operations, its subsidiaries and, where related to its chain of activities, its business partners where adverse impacts are most likely to occur and to be most severe. The second is an in-depth assessment of those areas only. Art. 8(2a) CSDDD adds a rule about the questionnaire itself. The company may request information from business partners only where that information is necessary and, in the case of partners with fewer than 5,000 employees, only when the information cannot reasonably be obtained by other means. Where impacts are equally likely or equally severe in several areas, the company may prioritize assessing those involving direct partners. The risk factors it must weigh under Art. 3(1)(u) CSDDD include whether the partner is not itself a company covered by the directive or by a comparable mandatory due diligence law.8CSDDD (n 2), Art. 8(2), (2a) and (3), Art. 3(1)(u), Art. 9(4), Art. 10(2)(b) and (e), (5) and (6), Art. 11(7), Art. 12, Art. 15, Art. 18, Art. 19(3). An active-ingredient supplier with 800 employees in Hyderabad is below that line, and so is any contract manufacturer short of the largest. The provision was written to protect such suppliers from a trickle-down of questionnaires. Its effect on the group is that the information it is least entitled to ask for concerns the site where the impact is most likely. The text does not say whether a supplier audit commissioned for GMP purposes counts as information reasonably obtainable by other means, which would bar the group from asking.
The required response is calibrated against leverage rather than results. Art. 10(2)(b) CSDDD asks it to seek contractual assurances from a direct partner that the partner will comply with the company's code of conduct and prevention plan, including by establishing corresponding assurances from its own partners to the extent their activities are part of the company's chain of activities. Art. 10(5) CSDDD requires those assurances to be accompanied by measures to verify compliance, with the company bearing the cost of independent third-party verification where the counterparty is an SME. Where impacts cannot be prevented, Art. 10(6) CSDDD as amended makes the company, as a last resort, refrain from new or extended relationships, suspend the relationship where the governing law entitles it to, and adopt an enhanced prevention plan. Member States must write an option to suspend into contracts governed by their laws, and before suspending the company must assess whether the suspension would be manifestly more severe than the impact it addresses. The original text's duty to terminate the relationship where the impact was severe and the enhanced plan had failed is gone. Art. 9(4) CSDDD adds that not having addressed a less significant impact, where prioritization was done under that article, does not expose the company to penalties.8 For a pharmaceutical group the suspension clause and the supply obligations it already carries under medicines law point in opposite directions. At a sole-source active-ingredient site, an adverse impact cannot be met by moving the order. The Commission's model contractual clauses under Art. 18 CSDDD and its general guidelines under Art. 19(3) CSDDD are due by 26 July 2027. As of publication neither existed, so any supplier code redrafted in 2026 is being drafted against a text whose guidance has not yet been written.
3. Germany's LkSG: Existing Duties and Proposed Changes
Germany did not wait for the directive. The LkSG has applied since 1 January 2023 and reaches, since 1 January 2024, any company with its seat, head office or principal place of business in Germany that employs at least 1,000 people there, as well as, under § 1(1) LkSG, a foreign company with a registered branch in Germany and 1,000 employees there. Within a group, § 1(3) LkSG attributes the German employees of every group company to the German parent. A US or Swiss group is therefore inside the Act through its German subsidiary, and the supply chain the Act examines is that subsidiary's. Under § 2(5) to (8) LkSG the supply chain covers every step at home and abroad from raw-material extraction to delivery to the end customer. It splits into the company's own business area, its direct suppliers, meaning contract partners whose supplies are necessary for the product, and its indirect suppliers, meaning everyone else whose supplies are. The consequence is easy to miss. A US parent that supplies active ingredient to its own German subsidiary is that subsidiary's direct supplier, and the subsidiary's § 5 LkSG risk analysis is owed in respect of the parent. The Act says expressly, in § 3(3) LkSG, that a breach of its duties grounds no civil liability, while leaving liability founded independently of the Act untouched. Toward indirect suppliers, § 9(3) LkSG requires the risk analysis, preventive measures and a concept to prevent, end or minimize the breach only where the company has substantiated knowledge of a possible breach; the complaints procedure reaches them from the outset, because under § 9(1) LkSG it must also take reports of risks and breaches caused by an indirect supplier. The Act backs the duties with fines of up to EUR 800,000 under § 24 LkSG. The second sentence of § 24(2) LkSG raises that ceiling tenfold, to EUR 8 million, where the fine is imposed on the company itself. A company with average annual turnover above EUR 400 million can also be fined up to 2 % of that turnover for failing to take remedial action or to draw up or implement a remediation concept. Under § 22 LkSG, a final fine at or above the thresholds set there, starting at EUR 175,000, also brings exclusion from public procurement for up to three years.9Lieferkettensorgfaltspflichtengesetz (LkSG), § 1, § 2(5) to (8), § 3(1) and (3), § 9(1) and (3), § 10(2), § 22, § 24.
The retreat began in 2025 and had not ended at publication. On 1 October 2025 the BAFA, the Act's enforcement authority, announced that it would stop reviewing company reports under § 12 and § 13 LkSG with immediate effect. It would impose fines, in pending and future proceedings alike, only for particularly serious allegations, those grave by their extent, their reach or their irreversible character, and only as a last resort where serious human-rights violations had occurred.10BAFA, 'Hinweis (01.10.2025): Vereinfachungen für Unternehmen beim Lieferkettengesetz' (1 October 2025). The government's bill, Bundestag document (Drucksache) 21/2474 of 29 October 2025, would write that policy into the statute. The annual reporting duty in § 10(2) to (4) LkSG would be deleted with retroactive effect from 1 January 2023, and § 12 and § 13 LkSG with it. The bill would rewrite § 24(1) LkSG to list four offenses: failing to take a preventive measure, failing to take a remedial measure and failing to draw up or implement a remediation concept, each only in respect of a human-rights risk under § 2(2) LkSG, and failing to establish a complaints procedure. All four would carry the EUR 800,000 ceiling, which the bill, like the Act, raises tenfold where the fine is imposed on the company, and the 2 % turnover tier would be retained for failing to take a remedial measure and for failing to draw up or implement a concept under § 7(2) LkSG. A failure to take a preventive or remedial measure, or to draw up or implement a concept, in respect of an environmental risk under § 2(3) LkSG would no longer be sanctionable under the Act at all. The bill's preamble records the intention to replace the LkSG seamlessly with a statute on international corporate responsibility transposing the CSDDD, and to keep the amended Act in place until then. The Bundestag held the first reading on 16 January 2026 and referred the bill to the Ausschuss für Arbeit und Soziales. As of publication the Act stood unamended.11Deutscher Bundestag, Drucksache 21/2474 (29 October 2025), Art. 1 no 2 and no 6, Art. 2; first reading 16 January 2026; not enacted as of publication. A US group that reads the German reports as a repeal has misread a change in enforcement policy. Every duty in § 3(1) LkSG, from the risk analysis to the complaints procedure, stands in full, and the BAFA's restraint is an announced exercise of discretion that binds no court and no successor.
The Harmonization Clause and the LkSG's Successor
The harder problem is the one the bill defers. Art. 4(1) CSDDD as amended forbids Member States to introduce due diligence obligations diverging from those in Art. 6, Art. 8, Art. 9, Art. 10(1) to (5), Art. 11(1) to (6) and Art. 14 to Art. 16 CSDDD. Art. 1(2) CSDDD expressly allows them to adjust existing national due diligence laws, in particular their scope, to align them with the directive.12CSDDD (n 2), Art. 1(2), Art. 4(1) and (2). The LkSG diverges from the directive on almost every axis the harmonization clause names. It is triggered by 1,000 German employees rather than 5,000 group employees and EUR 1.5 billion. It reaches indirect suppliers on substantiated knowledge rather than through a risk-based scoping of the whole chain of activities, and it excludes civil liability where Art. 29(2) CSDDD presupposes it. It keeps a duty to terminate the relationship in § 7(3) LkSG where the amended directive has only suspension, and it has no information cap and no five-year monitoring cycle. Germany must transpose by 26 July 2028 and apply from 26 July 2029. As of publication, the replacement statute's scope had not been made public. The groups with the most at stake in the transition are those inside the LkSG and outside the CSDDD, such as a group of 4,000 employees whose German subsidiary employs 1,200. For them, the question is whether the successor statute keeps them in scope. Nothing in the bill answers it, and the harmonization clause cuts both ways. A German legislator that wanted to keep the lower threshold would have to find room for it in Art. 4(2) CSDDD, which permits more stringent provisions only outside the harmonized articles.
4. Switzerland: Existing Due Diligence Duties and the Draft NUFG
Switzerland is not an EU Member State and the CSDDD has no direct effect there. A Swiss group is inside the directive only as a third-country company under Art. 2(2) CSDDD, on its EU turnover. The regulatory impact assessment of 5 March 2026 cited in the Federal Council's explanatory report counted about sixty large Swiss companies caught that way. But Swiss law has carried its own duties since 1 January 2022. Parliament enacted them as a statutory alternative, an indirect counter-proposal, to the constitutional amendment proposed by the first Konzernverantwortungsinitiative (Responsible Business Initiative). Art. 964a to 964c OR require public-interest companies (in Swiss audit law, chiefly listed companies and supervised financial institutions) that, together with their controlled companies, average at least 500 full-time positions and exceed CHF 20 million in total assets or CHF 40 million in turnover to publish an annual report on non-financial matters, including a description of the due diligence applied to human-rights and environmental concerns. The duty falls away where a foreign parent produces an equivalent report under foreign law. Art. 964j to 964l OR impose supply-chain due diligence and reporting duties on any company with its seat or head office in Switzerland that either brings tin, tantalum, tungsten or gold from conflict-affected and high-risk areas into free circulation in Switzerland or processes them there above the annual volumes set in the ordinance, or offers products or services in respect of which there is a reasonable suspicion of child labor. The VSoTr sets the volume thresholds by tariff heading. It exempts from the child-labor limb companies below two of the three figures of CHF 20 million in assets, CHF 40 million in turnover and 250 full-time positions, exempts companies sourcing from or producing in countries whose due diligence response the UNICEF Children's Rights in the Workplace Index rates as basic, and exempts companies applying a recognized equivalent framework in its entirety. The minerals duties must be audited by a licensed audit expert. Art. 325ter StGB punishes intentional false statements in, or omission of, those reports with a fine of up to CHF 100,000, and negligence with up to CHF 50,000.13Obligationenrecht (OR) (SR 220), Art. 964a to 964c, Art. 964j to 964l; VSoTr (SR 221.433), Art. 2, 4, 6, 7, 9, 16, Anhang 1; Strafgesetzbuch (StGB) (SR 311.0), Art. 325ter. For a device maker the minerals limb is narrower than it looks, because it keys to import and processing volumes for listed ores, concentrates and compounds, unwrought and semi-finished metals and articles of tin, tungsten and tantalum, each under its own tariff heading, rather than to the tantalum capacitors and tin solder on a finished board. Where a component-level import sits is a customs-classification question before it is a human-rights one. The child-labor limb is wider than it looks, because it turns on products and services rather than on a listed mineral, and cobalt in a device battery is not on the minerals list at all. Art. 964a(2) OR does not say whether a US parent's securities filings count as an equivalent report under foreign law.
The NUFG Counter-Proposal
The second initiative changed the horizon. The Konzernverantwortungsinitiative in its 2025 form was submitted on 27 May 2025. It proposes a new Art. 101a BV (the Federal Constitution) under which large Swiss-domiciled companies must respect internationally recognized human rights and environmental standards abroad, exercise a risk-based due diligence that extends to their business relationships, align their activities with the international climate target, answer in damages for harm caused by companies they control, and face an independent supervisory authority with sanctioning powers, with the Confederation to secure effective legal protection for the injured. On 3 September 2025 the Federal Council decided to recommend rejection and to present an indirect counter-proposal. Under Art. 97(2) ParlG (the Parliament Act), the Federal Council's message to Parliament on the initiative is due by 27 November 2026.14Volksinitiative «Für verantwortungsvolle Grossunternehmen» (submitted 27 May 2025); Federal Council decision of 3 September 2025; Art. 97(2) ParlG. The counter-proposal is the NUFG, a preliminary draft (Vorentwurf, cited here as VE-NUFG) adopted on 1 April 2026 and in consultation from 2 April to 9 July 2026. It transposes the Omnibus thresholds into francs. Art. 4(1)(a) VE-NUFG reaches Swiss companies that, with their controlled companies, exceed 5,000 full-time positions and CHF 1.5 billion of worldwide turnover in two consecutive years. Art. 4(2) VE-NUFG reaches foreign companies with more than CHF 1.5 billion of turnover on the Swiss market, which must then designate an authorized representative in Switzerland to deal with the authority. Art. 6 VE-NUFG restates the directive's duties, including the rule that information may be demanded from partners with fewer than 5,000 full-time positions only where it is not otherwise obtainable. Art. 5 VE-NUFG lets the Federal Council exempt companies that apply an equivalent internationally recognized framework from the modalities of implementing the duties, Art. 7 VE-NUFG requires an audited annual report, and Art. 8 VE-NUFG obliges companies to decide for themselves whether they are in scope and to notify the authority. Sustainability reporting under Art. 9 VE-NUFG moves to 1,000 full-time positions and CHF 450 million, which the explanatory report expects to reduce the reporting population from about 200 companies to about 110 while the due diligence duties would reach about thirty. Art. 964a to 964c and 964j to 964l OR and Art. 325ter StGB would be repealed and absorbed, the conflict-minerals and child-labor regime carried over unchanged, and, in line with the Omnibus, no climate transition plan would be required.15Vorentwurf NUFG (1 April 2026), Art. 2 to 9, Art. 39 to 42, Art. 45 and 46, Annex; Erläuternder Bericht, pp. 2 to 3 and 13.
The draft departs from the EU text in four ways that change what a group risks. Supervision is the first departure. Art. 20 VE-NUFG turns the RAB (the federal audit oversight authority) into an Eidgenössische Revisions- und Nachhaltigkeitsaufsichtsbehörde (a federal audit and sustainability oversight authority), which carries out risk-based reviews, including on site, under Art. 23 VE-NUFG. Art. 30 VE-NUFG arms it with measures the directive never contemplated. It may prohibit conduct and order remediation. Where such an order is not complied with despite a warning, or in urgent cases without one, it may transfer the powers of the company's governing bodies to a third party at the company's expense. In the same circumstances, it may order a company that has seriously or repeatedly breached its duties to reorganize, realign or dissolve the controlled companies that contributed to the breach. It may confiscate the profit made through the breach and exclude the company from public procurement at every level of the state for up to five years. Art. 31 VE-NUFG adds a pecuniary sanction of up to 3 % of worldwide turnover, and Art. 32 VE-NUFG adds the publication of final orders. Liability is the second. The main proposal in Art. 15 to 17 VE-NUFG makes a company subject to the duties liable for damage it caused abroad by breaching them intentionally or negligently, exclusively under Art. 16 VE-NUFG and with no liability for the conduct of business partners. It provides for joint and several liability among several liable companies, a limitation period of five years from knowledge and twenty from the act under Art. 18 VE-NUFG, and court-ordered disclosure of evidence under Art. 19 VE-NUFG. A variant leaves liability to the general provisions of the OR. The explanatory report records that a mild strict liability of Swiss parents for their foreign subsidiaries (liability without fault, subject to a due-care defense) was considered and rejected. Conflict of laws is the third. A new Art. 139a IPRG would subject claims arising from breaches of these duties by Swiss-seated companies to Swiss law, and new ZPO provisions would send liability claims under the draft to a single cantonal instance after mandatory conciliation before a special cantonal authority.16VE-NUFG (n 15), Art. 15 to 20, Art. 23, Art. 28 to 33, Annex (Art. 139a IPRG, Art. 5(1)(j) and Art. 212a to 212c ZPO); Erläuternder Bericht, p. 72. Switzerland thus proposes to legislate the very thing the Omnibus deleted, a rule that fixes the applicable law in favor of the forum. A claimant injured at a foreign site would face Swiss law against the Swiss parent in a Swiss court and, against the same group's German or Irish entity in an EU court, whatever Rome II produces. Timing is the fourth. Under Art. 46(2) VE-NUFG the law is to be published only once the initiative is withdrawn or rejected, and Art. 45 VE-NUFG keeps the old law in force for the financial year running at entry into force and for those beginning within two years after it. The Swiss regime a group must plan for in 2026 is therefore the OR regime it may already have overlooked, with a second regime behind it whose arrival depends on a popular vote that had not been scheduled at publication.
5. Strategic Considerations for Life-Sciences Groups Under Three Regimes
Which entity in the group each regime reaches depends first on the corporate chart. For a US group, the company under Art. 2(2)(b) CSDDD is the ultimate parent if consolidated EU turnover crosses EUR 1.5 billion; an EU sub-holding controlled by that parent is not an ultimate parent within Art. 3(1)(r) CSDDD, so it is a company only if it crosses the figures of Art. 2(1)(a) CSDDD on its own. The German GmbH is a company under § 1 LkSG if it has at least 1,000 employees in Germany, the Swiss AG is a company under Art. 4(1) VE-NUFG if the Swiss sub-group is large enough, and the US parent is one under Art. 4(2) VE-NUFG only if its turnover on the Swiss market exceeds CHF 1.5 billion. Art. 6(1) CSDDD lets a parent fulfill the obligations on behalf of subsidiaries that are themselves in scope, without prejudice to those subsidiaries remaining subject to the supervisory authority's powers and to civil liability. A group-level program therefore discharges the duty without shielding any subsidiary from either.2 Which authority supervises the parent turns, under Art. 24(3) CSDDD, on where the group has a branch or, failing one, where its EU turnover is highest. A group with a Dutch principal structure and German commercial subsidiaries may find that its transfer-pricing model has chosen its regulator.
Behind the chart sit the contracts. The same supplier code will be presented to the same active-ingredient site under three regimes with three different consequences for the same breach. Under the LkSG the consequence is a fine only within the catalog of § 24(1) LkSG, which the bill would cut from thirteen offenses to four and strip of environmental risks altogether. Under the CSDDD it is a supervisory penalty measured on group turnover and whatever a national court makes of Art. 29(2) CSDDD. Under Swiss law it is nothing until the NUFG arrives, unless the child-labor limb of Art. 964j OR already applies to the product. The cascade clause in Art. 10(2)(b) CSDDD, under which the direct partner is asked to obtain corresponding assurances from its own partners, sits beside the information cap in Art. 8(2a) CSDDD, so that a group may be obliged to ask its supplier for assurances about a sub-supplier it may not question directly. Art. 29(4) CSDDD ensures that the clause, once obtained, is evidence of effort rather than a defense. Whether a supplier code drafted in 2026 on a five-year term will still describe the duty in 2029 is a question its drafter cannot answer, because the model clauses that would tell them are due in 2027.
For a parent listed in the United States, European and US enforcement affect each other in both directions. A penalty decision published under Art. 27(5) CSDDD or an order published under Art. 32 VE-NUFG is a candidate for risk-factor disclosure and for a board's review of the foreign-regulatory-action exclusions in its D&O tower. An exclusion from public procurement under § 22 LkSG or Art. 30(7) VE-NUFG is, for a company that sells to hospitals, a market-access event rather than a compliance one. A Swiss order under Art. 30(4)(c) VE-NUFG to reorganize or dissolve a foreign subsidiary intervenes in group structure, something none of the US measures described at the outset does. In the other direction, a UFLPA detention is reasonably available information for the CSDDD scoping exercise, and a European supervisory finding of forced labor in the chain is the kind of record a customs authority is entitled to read. Each regime generates evidence for the others.
Where a particular group stands under each regime depends on which entity holds the EU revenue, how the German subsidiary is staffed, what the Swiss subsidiary imports and processes, and how the supplier contracts allocate information and assurance. It also depends on which of three calendars the group plans against: the German one that runs today, the EU one that starts on 26 July 2029, or the Swiss one that waits on a ballot.