On June 26, 2026, the European Commission (“Commission”) adopted its guidelines (“Guidelines”) on the implementation of the EU’s Forced Labour Regulation (“FLR”) and launched the Forced Labour Single Portal (the “Portal”). These tools are likely to serve as key practical resources for companies preparing for compliance, providing critical guidance on how the FLR will be implemented and enforced, including with regard to the import or export of affected goods. This alert provides an overview of these developments and key takeaways for companies.
The FLR will begin to apply on December 14, 2027. The law bans placing on, making available in, or exporting products from the EU market that are made using (in whole or in part) forced labour, irrespective of where in the supply chain the forced labour occurred (for additional background on the FLR, see here and here). The Guidelines are addressed to the EU Member States’ competent authorities responsible for implementing the FLR, customs authorities, “economic operators” (including companies), consumer associations, civil society organizations, trade unions, and other stakeholders. Although non-binding, the Guidelines will be instrumental in shaping the operational reality of FLR implementation and enforcement.
The Guidelines are extensive, providing clarity on a number of key enforcement issues (directed at competent authorities) and due diligence expectations (directed at economic operators). The Guidelines are likely to carry particular weight in practice: the Commission itself will act as the “lead competent authority” (“LCA”) for any enforcement concerning alleged forced labour outside the EU and we would expect it to closely adhere to its own Guidelines.
Key Information for Competent Authorities During the Investigative Process
Competent authorities may rely on a wide range of information sources when assessing whether there is a likely violation of the forced labour ban (and whether to initiate an investigation). Key sources will include: information submitted via the “single information submission point” (more below); the forced labour risk database’s information on geographic and product risks (still under development); the Guidelines’ list of forced labour risk indicators (based on the ILO Indicators of Forced Labour); information from stakeholders and other authorities (e.g., national labour inspectorates, judicial bodies, and authorities investigating human trafficking offences); and information gathered by competent authorities on their own initiative, including from investigations under other EU legal frameworks.
Investigations
The Guidelines resolve some uncertainty about the granularity of FLR investigations, clarifying that investigations may concern “parts, components or entire products, intermediate or final products, product series or categories of products of the same type, or products from a specific factory or facility.” Where evidence suggests a systemic or widespread use of forced labour, the investigative scope may be broadened to include additional products or categories of products from given suppliers and/or geographical areas. When investigating alleged violations of the forced labour ban, the LCA must decide not only which products to prioritize, but also which in-scope economic operators (i.e. economic operators placing on, making available in, or exporting products from the EU market) to focus on. Factors to assist with selecting economic operators include proximity to the alleged forced labour, leverage, their size and economic resources, and supply chain complexity.
The Guidelines address state-imposed forced labour in some detail, which could indicate that this will be an area of focus. In prioritizing cases for investigation, competent authorities must consider the scale and severity of suspected forced labour (among other factors) and ultimately prioritize large-scale, high-severity cases. The Guidelines note that state-imposed forced labour is inherently likely to meet this threshold, as it typically affects large numbers of people and involves structural or systemic practices imposed through the exercise of state authority.
Critically, the Guidelines suggest that companies may be able to prevent a full investigation by demonstrating steps to address alleged forced labour. The Guidelines indicate that if an economic operator demonstrates at the preliminary investigation stage “that it is taking appropriate steps to address the forced labour situation,” the LCA may grant it a reasonable period of time to complete such steps and end the forced labour, “taking into account the complexity of the process, the feasibility of ending the forced labour, the number of stakeholders involved, and the size and resources of the economic operators concerned.” Ultimately, if the reasons for the preliminary investigation are “eliminated,” the LCA should not proceed to a full investigation.
The Guidelines include an extensive, non-exhaustive list of evidence that the LCA may request during an investigation, including information on:
- The economic operator’s actions to identify, prevent, mitigate, bring to an end, or remediate risks of forced labour (e.g., corporate policies, codes of conduct, grievance mechanism documentation);
- Working conditions at the site of the alleged forced labour (e.g., worker interview transcripts, worker lists, photos/videos of working conditions, social audits, remediation information); and
- The product alleged to violate the forced labour ban, including product identification (e.g., traceability documentation, certificates of origin), supply chain structure and actors (e.g., supply chain maps, affidavits), facility and location information (e.g., geolocation data), transactional and logistics records (e.g., purchase orders, invoices, and receipts), and production and capacity evidence (e.g., factory production capacity reports).
Evidentiary Basis for Decisions
To determine that there has been a violation of the forced labour ban, the LCA must provide credible evidence that: (i) forced labour was used to make the products under investigation; and (ii) the economic operators under investigation made those products available on the EU market or exported them from the EU. The Guidelines acknowledge that establishing that products were made with forced labour may present evidentiary challenges, and that establishing a violation will often require a combination of different types of evidence, “including indirect and circumstantial evidence.” The Guidelines also address how to assess evidence in cases of state-imposed forced labour.
Penalties for Violations of LCA Product Ban Decisions
The principal enforcement mechanism under the FLR is the product ban itself, implemented through LCA decisions prohibiting product placement on the market and requiring withdrawal and disposal. Under the FLR, financial penalties target only non-compliance with an LCA decision, for example where a company continues to sell banned products, fails to withdraw them, or fails to replace non-compliant components. The FLR itself is non-prescriptive on the nature of penalties, but the Guidelines provide a five-step methodology to guide Member States in setting penalties, considering factors such as gravity, duration, and mitigating or aggravating circumstances. The Guidelines offer two illustrative penalty-setting models: penalties based on product value or on turnover (e.g., depending on the gravity and duration of non-compliance, penalties might range from 0% to 4% of the economic operator’s annual global turnover).
Underpinned by International Standards
While the Guidelines confirm (as set out in the FLR itself) that due diligence is not required, forced labour due diligence is recommended and likely to “help economic operators to be at a lower risk of having forced labour in their operations and supply chains” and “showcase economic operators’ efforts to identify and address forced labour risks during potential investigations.” The Guidelines draw heavily on international frameworks, including the OECD Guidelines on Responsible Business Conduct (“OECD Guidelines”) and the UN Guiding Principles on Business and Human Rights (“UNGPs”). The Guidelines indicate that good practice is likely to revolve around the “six-step” due diligence framework contained in the OECD Due Diligence Guidance for Responsible Business Conduct, albeit tailored to the forced labour context. Within each recommended due diligence “step,” the Guidelines include illustrative examples of practical actions companies can implement to demonstrate robust forced labour due diligence, including developing specific policies to identify identified risks, building forced labour due diligence criteria into business partner assessments, conducting risk assessments, developing prevention and corrective action plans and various means of engaging in remediation of forced labour situations, .
Addressing Challenges of Forced Labour Due Diligence
Although the FLR is outcome-oriented rather than process-oriented, the Guidelines acknowledge several pervasive challenges of forced labour supply chain due diligence. For example, the Guidelines encourage competent authorities to bear in mind that greater supply chain complexity generally reduces transparency, accountability, and traceability of forced labour risks. The Guidelines address the reality that companies have different degrees of leverage over business partners to influence improvements in labour conditions. The Guidelines also acknowledge that addressing forced labour risks in a short period of time may not be realistic, and in such cases, responsible disengagement may be the only available means to address forced labour in the production process (particularly in situations involving state-imposed forced labour). While acknowledging specific challenges, the Guidelines present good practice recommendations to enable companies to demonstrate their due diligence efforts to facilitate compliance with the forced labour ban.
Intersection between the Corporate Sustainability Due Diligence Directive (“CSDDD”) and the FLR
Fundamentally, the FLR imposes an “obligation of results” (as opposed to an “obligation of means” found in due diligence laws). Nevertheless, the due diligence content in the Guidelines signals a significant convergence between implications of the FLR and CSDDD (see more on the CSDDD here) for companies’ human rights due diligence programs, not least because both laws are underpinned by the same international due diligence frameworks. The Commission will also be a central stakeholder in the enforcement of both regimes: it will act as LCA for FLR enforcement concerning forced labour outside the EU, and it will chair the network of CSDDD supervisory authorities. The Guidelines expressly contemplate this overlap, clarifying that competent authorities may use information from investigations under other EU legal frameworks, including the CSDDD.
The Guidelines reflect an effort at policy coherence with the CSDDD. In particular:
- The FLR due diligence guidance reflects concepts incorporated into the CSDDD due diligence obligations. The Guidelines suggest that in order to identify forced labour risks, a company should conduct a “scoping exercise” to identify “general areas” where forced labour risks are most likely to occur and be most significant, followed by an “in-depth assessment” of the most significant risks (akin to the approach mandated under Article 8 CSDDD).
- The Guidelines note that “where it is not feasible to prevent, mitigate, or end all identified forced labour risks immediately, companies should prioritize, in line with a risk-based approach to due diligence, addressing the most significant risks first, based on their severity and likelihood.” This aligns with the CSDDD’s requirement for companies to prioritize adverse impacts if they cannot be addressed all at once (Article 9). How prioritization efforts will be treated in enforcement of the FLR’s results-based regime remains to be seen.
- The Guidelines state that companies should adopt “appropriate measures” to prevent, mitigate, or bring to an end forced labour risks. Again, this mirrors the CSDDD’s requirement for companies to adopt appropriate measures to address identified actual and potential adverse human rights impacts (Articles 10 and 11).
Despite the partial alignment, critical differences remain between the CSDDD and FLR. In particular, in an FLR enforcement context, economic operators may be asked to provide significant traceability evidence, something that is not a specific focus in the CSDDD.
Importance of Remediation
While the FLR does not impose a binding obligation on companies to remediate instances of forced labour, the Guidelines note that where situations of forced labour do materialize, companies “must comply with the forced labour ban and should be ready to engage in remediation” (with the level of engagement varying depending on their involvement in the forced labour impacts). For a company to appeal a ban decision, it must demonstrate that forced labour has been eliminated, including measures adopted to address forced labour (which, in practice, likely include an element of remediation).
Consistent with the CSDDD, the Guidelines define remediation as restoring affected individuals or communities to a situation equivalent to, or as close as possible to, the one they would have been in had the forced labour not occurred. The Guidelines also note that remediation “involves addressing the root causes of forced labour and preventing future abuses.” The Guidelines list a wide range of actions that could constitute remediation, including restitution (e.g., repayment of recruitment fees), financial compensation (e.g., for unpaid wages or abusive working and living conditions), rehabilitation (e.g., support for alternative employment), non-financial compensation (e.g., reduced working hours), and internal accountability or disciplinary measures (e.g., dismissals of staff responsible for the impact).
The Guidelines state that where appropriate, companies should provide or cooperate with legitimate remediation or grievance mechanisms through which impacted workers and rightsholders, as well as other stakeholders, can report forced labour complaints. Specifically, companies should “cooperate in good faith” with non-judicial grievance mechanisms like the OECD National Contact Point (“NCP”) (see more on the NCP process here).
The newly launched Portal contains a variety of FLR-related materials, including an overview of the FLR, a list of Member State competent authorities, Commission contacts, and links to ILO and OECD resources. From September to November 2026, the Commission plans to host multiple webinars on FLR preparation, including sector-specific trainings.
The Portal will ultimately serve as the central public repository for all FLR-relevant information: the Guidelines, the database, competent authority contacts, the single information submission point, and all published decisions and their reviews or withdrawals. The single information submission point could significantly influence the Commission’s identification of potential investigative targets, as it will operate as a free, secure, online channel through which individuals and organizations can share information about products or companies potentially linked to forced labour and with a connection to the EU market. We anticipate that NGO disclosures, investigative journalism, and civil society reports on supply chain issues will be used as submissions.
Companies might consider the following actions as they prepare for FLR compliance:
- Develop an FLR strategy across functions: FLR compliance will likely cut across multiple functions, including legal, compliance, procurement and sourcing, sustainability, human rights, internal audit, human resources, government affairs, and communications. A coordinated approach will support comprehensive supply chain mapping, effective engagement with business partners, due diligence documentation, and enforcement response capability.
- Tailoring risk mitigation activities based on severity and likelihood of harm: Competent authorities and the Commission are required to prioritize investigations by reference to the scale and severity of suspected forced labour, the quantity or volume of products on the EU market, and the share of the part suspected of being made with forced labour in the final product. Based on available resources, companies may consider these same factors when building their compliance strategies.
- Implementing a coordinated international approach to forced labour product bans and due diligence laws: The FLR does not exist in isolation. The law intersects with the EU’s CSDDD and also joins a rapidly expanding patchwork of forced labour-related market access measures (e.g., in the U.S., Canada, Mexico, Indonesia, Pakistan, Nicaragua, El Salvador, and other jurisdictions). While the evidentiary and enforcement architectures differ across regimes, the underlying need to respond to enforcement authorities with evidentiary supply chain documentation is similar. Companies with global footprints should consider building a single, coherent forced labour program deployable in response to obligations and enforcement in multiple jurisdictions. Aligning compliance workstreams across regimes will likely reduce duplication and generate consistent risk mitigation practice and documentation.
If you have any questions concerning the material discussed in this alert, please contact our Business and Human Rights practice.
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