The German government has reached a consensus on a supply chain bill that requires companies to take into account human rights and environmental protection.

The German government has reached a legislative consensus that will require domestic companies to conduct due diligence for dimensions of global supply chains related to human rights and environmental issues, sources said.

According to the document seen by Reuters, more than 600 companies with at least 3,000 employees will apply the bill from 2023. Some 2,900 companies with more than 1,000 employees would apply from 2024.

Critics warn that the supply chain bill threatens to make companies liable for health and environmental damages proposed by environmental groups, and that companies may face unlimited financial risk if they fail to require suppliers to comply.