The European Union approved the Forced Labour Regulation (FLR) on November 19, 2024, and it came into effect on December 13, 2024. This new regulation prohibits the sale, placement, or export of products made with forced labor in the EU market. Starting on 14 December 2027, businesses have three years to adjust and meet these requirements, aiming to change global supply chains.
What the Forced Labour Regulation covers
The EUFLR applies to all products—including components—sold, imported, or exported in the EU. This includes online sales and covers every industry, without value thresholds or geographic exceptions. The regulation defines forced labour using the International Labour Organisation’s (ILO) Forced Labour Convention, covering abuses such as debt bondage, coercion, and excessive overtime
Key compliance requirements
Companies operating in or with the EU must:
- Map their supply chains to identify all tiers, including subcontractors and raw material sources
- Assess risks using credible sources and tools, such as the ILO indicators and forced labour risk databases
- Implement and document robust due diligence measures to identify, prevent, and address forced labour risks
- Provide the necessary documentation to authorities within 30 days for initial investigations, and up to 60 days for more detailed reviews.
Enforcement and penalties
National authorities and the European Commission will investigate suspected violations using a risk-based approach, prioritising cases based on severity, product volume, and the share of forced labour in the product If a violation is confirmed, authorities can:
- Ban the product from the EU market and prohibit its export.
- Order withdrawal and disposal of non-compliant goods at the company’s expense.
- Publicly disclose the product, supplier, and evidence on the Forced Labour Single Portal.
Penalties for non-compliance are determined by national law and must be effective, proportionate, and dissuasive. Consequences include product bans, financial penalties, and reputational damage.
What makes the EUFLR distinct
Unlike similar regulations in other jurisdictions, the EUFLR bans re-exporting non-compliant items to third countries. This ensures that products made with forced labor aren't sent to other areas. The regulation applies to all products, nations, and industries, setting a new global benchmark for ethical trade and supply chain transparency.
Preparing for the new legal landscape
Companies must act now to ensure compliance by:
- Conducting comprehensive supply chain mapping
- Performing risk assessments using established indices and monitoring systems
- Establishing due diligence procedures aligned with international standards
- Maintaining documentation to demonstrate compliance during investigations
Failure to comply will result in severe operational and financial consequences
How you can support ethical and sustainable supply chains with Factlines' Supplier Relationship Management (SRM) software
The EUFLR is a decisive step in addressing forced labour, affecting millions globally. Factlines supports businesses in navigating these new requirements, offering tools and expertise for effective supply chain due diligence and risk management.
For guidance on compliance and ethical operations, request a Free Trial or Book a Demo with Factlines today!
