NL – Supply Chains, 2nd NAP

Pillar I

Central government procurement and private-sector instruments

“…The government’s central procurement strategy includes the International Social Conditions (ISCs). These have applied to all EU contract award procedures since 2017 and aim to establish more sustainable international supply chains by preventing or responding to risks related to working conditions, human rights and the environment. The ISCs are one of the contractual conditions obliging contractors to apply due diligence.” p.31.

Pillar I

Private-sector instruments

“… Any business using the government’s international financing instruments or requesting any other support focussed on international entrepreneurship, will have to show that it adheres to the OECD Guidelines and implements due diligence on its international supply chain.….’’ p. 35.

Pillar I

Development cooperation

Sustainable trade with and investment in developing countries

“Development cooperation policy on business and human rights focuses on improving the sustainability of production and international value chains in and with developing countries in a way that helps reduce poverty and inequality. To this end it is important that a) the interests and specific situation of the developing countries in question are considered when designing measures aimed at making trade and investments more sustainable, and b) developing countries are supported in the transition required to meet these commitments to inclusive, green economic development.

The interests and specific circumstances of developing countries must be considered when drafting national, European and international agreements aimed at improving the sustainability of trade and investments. Examples include developing standards on deforestation and the climate, the circular economy, land use rights, labour, foreign trade and investments and RBC. The cornerstone of this is to determine the development impact of efforts to make trade and investment more sustainable, especially the impact on vulnerable groups such as indigenous peoples, small-scale producers, workers and agricultural labourers, with a particular focus on women and young people. This should reinforce the efforts’ positive effects and, as far as possible, prevent and mitigate any negative side effects. Developing countries receive several forms of support. First, bilateral and EU- and World Bank-led discussions take place with governments in developing countries about the transition towards greater sustainability, and ways of reducing poverty and inequality in the course of this transition. Second, Dutch civil society organisations such as trade unions and employers’ organisations receive funding to, on the one hand, strengthen sister organisations in developing countries (for example through dialogue with other local stakeholders) and, on the other, to advocate at international level the interests of, in particular, small-scale producers and workers. Third, a range of Dutch and international implementing organisations make efforts to improve the business climate and supplementary government policy in developing countries, focusing particularly on SME producers as the ones playing the most significant role in poverty alleviation. Examples include providing access to financial services, improving infrastructure and building capacity for entrepreneurs and their trade associations. Fourth, efforts are made to increase the sustainability of international value chains by working jointly with businesses, civil society organisations and other levels of government on improved procurement practices and new revenue models with a focus on work, a living wage and income, land rights and land use and the elimination of child labour.” p. 46

“Further strengthening cooperation between ministries and between Dutch government and other stakeholders can help ensure that the establishment of national, European and international sustainability frameworks and standards and their impact on and support of developing countries mutually reinforce each other even more (learning capacity for coherence). This is particularly important in specific risk sectors and value chains such as cacao, textiles and palm oil which have a significant Dutch footprint. In addition to a separate, permanent interministerial dialogue to be established, the focus will be on lastingly improving learning capacity regarding these activities, so that risks are addressed and mitigated.” p.48.

ACTION POINTS PILLAR 1	Aim	Responsible party	Timeline
Sustainable trade with and investment in developing countries
Strengthen collaboration between ministries by establishing an interministerial working group to conduct a permanent dialogue on sustainable trade and investments, focusing on specific high-risk value chains with a strong Dutch footprint.	Enhance learning capacity regarding policy coherence on sustainable trade and investments and on business and human rights	All ministries involved, with BZ taking the initiative.	From 2022
Research, monitor and evaluate the impact on developing/producing countries of national, European and international sets of rules and standards aimed at improving the sustainability of trade and investments, where possible under the auspices of the EU and supported by local stakeholder consultations	Enhance learning capacity regarding policy coherence on sustainable trade and investments and on business and human rights.	BZ	On introduction of new proposals and during implementation

p. 49

Pillar II

Corporate Sustainability Reporting Directive (CSRD)

“… In line with the UNGPs, accountability should be given of the due diligence process, including a description of any negative impacts in the company’s value chain resulting from its own activities or from its business relations and supply chain….” p. 56.

Sector-wide Cooperation

“…The government aims to continue to encourage sector-wide initiatives aimed at implementing due diligence and at raising its impact on specific themes or value chains, in line with the OECD Guidelines and the UNGPs. By collaborating with civil society organisations, businesses can impact the value chain by making linkages and jointly increasing their influence. …” p. 58.

Pillar III

Improving the provision of information to affected parties

“… The government will produce an accessible digital guide describing the judicial and non-judicial remedies available to parties abroad who have been affected by Dutch companies (through their international supply chains). …” p. 63.

Improving the provision of information to businesses

 “The Dutch Banking Sector Agreement, for example, has investigated the role of financial institutions in offering remedy, and the Sustainable Clothing and Textile Agreement has set up an independent joint complaints mechanism. At the same time many companies are still struggling with the question of how exactly to offer remedy for possible human rights violations deeper in their value chains. It is not always clear how to deal with this, especially, for example, if the business in the Netherlands is just one of the buyers of a product or raw material.” p. 64.

Improving access to judicial mechanisms

Applicable law: Rome II

“… The government would support a broad review of Rome II, which should include discussions on the applicable law in cases of human rights violations in international value chains.” p. 74.

Grounds for jurisdiction of Dutch courts

“The NBA also notes that in cross-border civil proceedings that have thus far been pursued in the Netherlands, the defendants included Dutch partners as well as subsidiaries based in other countries. As far as is known no legal proceedings have as yet been conducted in the Netherlands involving damage caused by partners in the value chain of Dutch companies other than foreign subsidiaries, that is, non-group company liability.” p.74.