The association has called on the US Government to continue to press the European Commission to limit the “extraterritorial application” of the EU’s Corporate Sustainability Due Diligence Directive (CSDDD) and related measures, and to secure an exemption for U.S. companies.
The CSDDD establishes mandatory rules for large companies to identify, prevent, and mitigate adverse human rights and environmental impacts across their global value chains. The issue for US companies arises when they are dealing with a multinational customers, who operate in Europe. They can face the additional audits, questionnaires and document requirements, as a result of their customers’ compliance obligations.
In a recent letter to the Office of the U.S. Trade Representative IDFA raised concerns that EU-based companies are increasingly imposing social audits and other due diligence obligations on US companies that do not trade with the EU, as well as on global companies doing business with its members in the United States.
The IDFA also commissioned a legal analysis comparing US labour standards in dairy operations across federal and state laws.
It looked at six areas of worker protection including child labour, forced labour, freedom of association, working conditions, occupational health and safety and non-discrimination. It found that while US laws and international frameworks take different approaches.
In particular, the international standards place greater emphasis on requirements such as documentation, stakeholder engagement, grievance mechanisms and supply chain monitoring that are not required under US law.
Michael Dykes, president as CEO of IDFA, said that the US dairy sector “strongly supports” the protection of human and worker rights.
“But our trading partners should respect our regulatory system just as we respect theirs. US companies should not be required to duplicate or layer foreign regulatory requirements on top of the laws they already follow simply because those requirements are being applied through global supply chains.”
