EU Forced Labor Regulation Published in Official Journal, Beginning the Countdown to Compliance – A Deep Dive and Compliance Take-aways

The EU’s new forced labor Regulation was published in the Official Journal of the European Union last Thursday. The Regulation will prohibit products made with forced labor from being imported into or exported from the EU or otherwise made available on the EU market. The Regulation is the broadest forced labor product ban adopted thus far anywhere in the world. In this post, we discuss the Regulation in detail and provide seven compliance takeaways.

The Regulation was more than three years in the making. In contrast to other recent EU corporate responsibility legislation, the Regulation had overwhelming support. In the Parliament, the Regulation received 90%+ support. It enjoyed similarly high support in the Council, with 25 member states voting in favor and two abstaining.

A broad regulation

The Regulation will prohibit economic operators from placing or making available on the EU market products that are made with forced labor. The prohibition applies to both imported products and products produced in the EU, including products offered for sale online. The Regulation also prohibits exporting from the EU products made with forced labor.

The Regulation applies to all sectors and levels of the supply chain. A product is made with forced labor if forced labor has been used in whole or in part at any stage of its extraction, harvest, production or manufacture, including in the working or processing related to the product. 

The Regulation does not contain a de minimis exception, although, as discussed later in this post, the quantity or volume of products is a factor to be considered in enforcement.

But a long implementation period

The Regulation will apply starting on December 14, 2027, three years after its publication in the Official Journal.

Forced labor defined

For purposes of the Regulation, “forced labor” is forced or compulsory labor, including child labor. The Regulation incorporates by reference the definition used in International Labour Organization Convention 29. Under that Convention, forced or compulsory labor generally is all work or service exacted from any person under the menace of penalty and for which the person has not offered themself voluntarily.

EU database of forced labor risk areas and products

The European Commission is required to establish a database of forced labor risks to support the work of competent authorities in assessing potential violations of the Regulation and to help economic operators identify possible forced labor risks in their supply chains. The database will be indicative and non-exhaustive.

The database is to include evidence-based and verifiable information on forced labor risks in specific geographic areas or with respect to specific products or product groups. Regarding forced labor imposed by state authorities, the database is required to indicate specific economic sectors in specific geographic areas for which there is reliable and verifiable evidence that this form of forced labor exists. The database is required to prioritize the identification of widespread and severe forced labor risks.

It is contemplated that the database will take into account information from international organizations, in particular the ILO and the UN, as well as institutional, research or academic organizations. The Commission also is expressly authorized to enlist external expertise if needed. 

The database must be publicly available by June 14, 2026. It is to be regularly updated.

Many readers of this post will be familiar with the annual list of goods produced with forced or child labor published by the U.S. Department of Labor. The 2024 list includes 204 goods from 82 countries and areas. The U.S. Department of Homeland Security also publishes a periodically updated Uyghur Forced Labor Prevention Act Entity List, which now includes over 100 entities. Entities on the list are presumed to produce goods with forced labor, prohibiting their importation into the United States (the Entity List is further discussed in this recent Ropes & Gray post). U.S. Customs and Border Protection also publishes Withhold Release Orders and findings issued with respect to particular goods (see here for the list of 51 active WROs and 9 active findings).

Although not specific to forced labor, the European Commission publishes an analogous list of conflict-affected and high-risk areas, or CAHRAs, under the EU Conflict Minerals Regulation. That regulation required the European Commission to call upon external expertise to provide an indicative, non-exhaustive, regularly updated list of CAHRAs to support importers in their due diligence (for a further discussion, see this post).

Further compliance guidelines

Under the Regulation, the Commission is required to issue guidelines by June 14, 2026. Among other things, these are required to include forced labor due diligence guidance for economic operators. 

Forced labor investigations and product bans

Each EU member state is required to designate a competent authority that is responsible for carrying out the member state’s obligations under the Regulation. This is required to occur by December 14, 2025.

Investigations are broken out into two phases, as discussed below.

Preliminary investigation

The Regulation contemplates a risk-based approach by competent authorities when assessing the likelihood of a violation, initiating and conducting a preliminary investigation and identifying products and economic operators involving forced labor. To aid in identifying alleged violations, the European Commission is required to set up a single access point for complaints.

If the suspected forced labor is taking place outside the European Union, the Commission will be the lead competent authority. If the suspected forced labor is taking place in a member state, a competent authority of that member state will take the lead.

When assessing the likelihood of a violation, the Commission and member state competent authorities are required to use the following prioritization criteria, as appropriate:

• The scale and severity of the suspected forced labor, including whether forced labor imposed by state authorities could be a concern;
• The quantity or volume of products placed or made available on the EU market; and
• The relative share of the part of the product suspected to have been made with forced labor.

When initiating a preliminary investigation, the lead competent authority is required, to the extent possible, to focus on the economic operators and, where relevant, product suppliers involved in the steps of the supply chain as close as possible to where the forced labor is likely occurring and with the highest leverage to prevent, mitigate and bring to an end the use of forced labor. The lead competent authority also is required to take into account the size and economic resources of the economic operators concerned and the complexity of the supply chain.

In connection with a preliminary investigation, the lead competent authority generally is expected to request information from the economic operators under assessment and, where relevant, other product suppliers, on the actions they have taken to identify, prevent, mitigate, bring to an end or remediate risks of forced labor in their operations and supply chains with respect to the applicable products. The lead competent authority must do so before launching a more fulsome investigation based on a substantiated concern (discussed below). The lead competent authority also may request information from other relevant stakeholders. 

Economic operators are required to respond to an information request within 30 business days. Within 30 business days after receiving the information, the lead competent authority is required to finish the preliminary phase of its investigation. The lead competent authority is required to inform the economic operators under assessment if it concludes there is no substantiated concern of a violation. 

Substantiated concern of forced labor

If the lead competent authority determines there is a substantiated concern of forced labor, it will initiate an investigation of the relevant products and economic operators. The lead competent authority is required to inform the economic operators within three business days of the decision to initiate the investigation.

The lead competent authority may require the economic operator under investigation to submit information relevant to the investigation, including supply chain information. In doing so, the lead competent authority is required, to the extent possible, to prioritize the economic operators under investigation involved in the steps of the supply chain as close as possible to where the forced labor is likely occurring and to take into account the size and economic resources of the economic operators, the quantity of products concerned, the complexity of the supply chain and the scale of suspected forced labor.

The economic operator must be given between 30 and 60 business days to submit requested information. The lead competent authority also may collect information from other stakeholders. In exceptional situations determined to be necessary by the lead competent authority, it may conduct field inspections. 

Forced labor finding

The lead competent authority is required to endeavor to reach a determination or close its investigation within nine months after its initiation. 

If the lead competent authority determines that the products concerned were placed or made available on the EU market or are being exported in violation of the Regulation, it will adopt a decision (1) prohibiting the products from being placed or made available on the EU market and from being exported, (2) requiring the economic operator subject to the investigation to withdraw the products already placed or made available on the EU market and to remove online content referring to the products and (3) requiring the economic operator to dispose of the products or, if parts of the product are found to violate the Regulation, those parts. 

Products are to be disposed of by recycling or, when that is not possible, rendering them inoperable. Perishable products are required to be donated for charitable or public interest purposes or, if that is not possible, they are to be rendered inoperable.

Decisions by a member state lead competent authority are required to be recognized and enforced by competent authorities in the other EU member states in respect of products with the same identification information and originating from the same supply chain.

Economic operators are to be given reasonable time limits to comply with an order. They generally are required to be given at least 30 business days, except that for perishable goods, animals and plants, the minimum time is ten business days. In setting the time limit, the lead competent authority is required to take into account the economic operator’s size and economic resources and the share of the part of the product and whether it is replaceable. 

The European Commission will make public any decision to ban a product.

Review of decisions

Economic operators may at any time request that a decision be reviewed. In connection with the request, the economic operator is required to provide information demonstrating that the applicable products are compliant with the Regulation. The lead competent authority is required to reach a decision on the request within 30 business days of receipt.

If the economic operator demonstrates that it has complied with the lead competent authority’s decision and has eliminated forced labor from its operations or supply chain with respect to the products concerned, the lead competent authority will prospectively withdraw its decision.

Economic operators also can seek to have the decision of a lead competent authority reviewed by a court or other applicable tribunal, subject to any national law provisions that first require administrative review procedures to be exhausted.

Enforcement

If an economic operator fails to comply with the decision of a lead competent authority, the competent authorities will be responsible for the enforcement of the decision. Member states are required to adopt penalties for non-compliance by December 14, 2026. 

Member state cooperation

The Regulation also establishes a Union Network Against Forced Labor Products. The Network is intended as a platform for structured coordination and cooperation between member state competent authorities and the European Commission and for streamlining enforcement. Among other things, the Network is intended to facilitate the identification of common enforcement priorities, facilitate the coordination of investigations and contribute to uniform risk-based approaches and administrative practices for the implementation of the Regulation.

The Network will include representatives from each member state, the Commission and customs authorities. The Commission will coordinate the work of the Network. 

Seven compliance takeaways

1. The good news for economic operators dealing with a crush of new corporate responsibility compliance requirements (in the EU and elsewhere) is that the Regulation will not apply for three years. However, that does not necessarily mean that a compliance uplift will not be required before then. 
2. The scope of the Regulation – imports, exports and domestic goods – is broader than other forced labor product bans. In contrast, the forced labor product bans in the United States, Canada (discussed here) and Mexico (discussed in this post) are limited to imported goods. Like these other bans, the Regulation also applies broadly to all products and levels of production.
3. By its terms, the Regulation treats all regions of the world the same. Unlike under U.S. law, there is not a presumption that particular goods or regions involve forced labor. In this regard, see the U.S. Uyghur Forced Labor Prevention Act, which is focused on the Xinjiang region of China, and the Countering America’s Adversaries Through Sanctions Act, which is focused on North Korea. The UFLPA and related compliance guidance published by the U.S. government are discussed in detail in our earlier Alerts here and here. CAATSA is discussed in our Alerts here and here. Although the Regulation is neutral on its face, it remains to be seen how competent authorities will apply the forced labor risk database once it is developed.
4. Keep in mind other complementary EU legislation. For example, forced labor due diligence is contemplated by the recently adopted EU Corporate Sustainability Due Diligence Directive (for a detailed discussion of the CSDDD, see this post). For larger economic operators, their CSDDD compliance initiatives will presumably put them in good stead for compliance with the Regulation (conversely, a forced labor finding under the Regulation may trigger actions or create the risk of liability under the CSDDD). In addition, the EU Corporate Sustainability Reporting Directive contemplates disclosures relating to forced labor where financially or impact material (see this post for links to approximately 30 of our CSRD resources).
5. The Regulation will impact a large number of companies with no direct connection to the European Union. It will put further pressure on forced labor compliance by all supply chain tiers, which already has increased significantly over the last several years, especially since the adoption of the UFLPA. 
6. Companies should consider whether to engage with the Commission in connection with the development of guidelines or the risk database, either through their trade associations or individually.
7. Even though the ink is barely dry, we already are being asked whether we think the Regulation will be pushed back or amended. There have been numerous calls to scale back or postpone various recently adopted EU corporate responsibility mandates, and those calls appear to be getting louder. For example, initial compliance with the EU Deforestation Regulation has been pushed back by a year to the end of 2025 (see this post). There also are calls from some quarters to soften the CSRD and CSDDD and, last month, European Commission President Ursula von der Leyen indicated that the CSRD, CSDDD and Taxonomy Regulation will be combined. Although the political winds may continue to shift, the prevailing view today is that a delay of the Regulation is unlikely given its overwhelming support.

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