On September 3, 2025, the German Cabinet adopted an amendment to the German Supply Chain Due Diligence Act (Lieferkettensorgfaltspflichtengesetz, LkSG). The key change is the elimination of the reporting obligation. Affected companies no longer need to submit an annual report to the Federal Office for Economic Affairs and Export Control (BAFA) or publish it on their website. All due diligence obligations remain fully in force: companies must continue to identify, assess and mitigate risks in their supply chains. Serious breaches may result in sanctions. Although the amendment reduces a small part of the administrative burden, the substantive requirements for companies remain unchanged. 

Background: reporting under the LkSG

The LkSG has been in force since early 2023. It requires large companies to implement risk management and take preventive and remedial measures. Until now, it has also required them to publicly report on this annually. Since 2023, the law has applied to companies with more than 3,000 employees, and since 2024, it has applied to companies with more than 1,000 employees. 

With the amendment, the formal reporting process is abolished to avoid duplication and reduce bureaucracy. According to the Federal Ministry of Labour and Social Affairs (BMAS), around 5,200 companies are affected, with estimated annual savings of about €4.1 million. 

Transition to the EU supply chain law (CSDDD)

Until the EU Corporate Sustainability Due Diligence Directive (CSDDD) is transposed into national law (planned by July 2027), the German LkSG remains in force. As BMAS noted in a press release (German): “The national law will continue seamlessly until the EU supply chain law is transposed into German law. Crucially, the coalition agreement commits to not lowering human rights standards.” 

The CSDDD builds on the LkSG but goes further in scope by also covering environmental due diligence. In parallel, the EU is working on simplifications and consistent implementation via the Omnibus I Directive. 

Important: The abolished national reporting duty may be replaced by new, potentially more demanding, European requirements.

What this means in practice

Even without the BAFA report and website publication, all other LkSG obligations remain. Companies must continue to: 

• run effective risk management, 
• monitor their supply chains, and 
• document appropriate measures. 

External reporting may be gone, but internal evidence becomes more important. Companies must be able to demonstrate during audits – or later under the CSDDD – that they meet their due diligence obligations. The end of the reporting duty does not suspend BAFA supervision. Especially in high-risk areas, requests for information or audits can still occur. Continuous documentation and a structured internal risk management approach remain essential. 

In short: the reporting change is not a license to scale back activity. Companies should consistently maintain and mature their processes – regularly reassessing risks, implementing preventive and remedial actions, and recording effectiveness internally. With the CSDDD set to add further requirements in the coming years, it is prudent to align structures now with forthcoming European standards. Organizations that invest early in transparent, robust processes will face fewer adjustments later. 

How software can help

Meeting due diligence obligations is complex: companies must process supplier data at scale, assess risks and maintain defensible records. Digital solutions can make this substantially easier. The osapiens HUB for Due Diligence centralizes and automates risk management, supplier assessment, action tracking and documentation. This supports compliance with today’s LkSG requirements and creates a solid foundation for implementing the CSDDD.