US resistance to CSDDD grows with new senate bill

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🗞️ Driving the news: Senator Bill Hagerty has introduced the ‘Protect USA Act’ to prevent US companies from complying with the EU’s Corporate Sustainability Due Diligence Directive (CSDDD)
• The bill argues that such regulations impose extraterritorial obligations on American businesses
• Non-compliance could lead to penalties, including fines of up to $1 million and suspension from federal contracts for up to three years

🔭 The context: The CSDDD requires companies operating in the EU to conduct extensive due diligence on environmental and human rights impacts in their supply chains
• Some US firms fear conflicting obligations between US and EU regulations
• The proposed bill could deepen regulatory uncertainty for businesses operating across both jurisdictions

🌍 Why it matters for the planet: If enacted, the bill could weaken corporate sustainability efforts by limiting US companies’ compliance with the CSDDD
• This may lead to reduced transparency in supply chains and hinder ESG progress globally
• The move reflects growing resistance to stringent sustainability regulations in international trade

⏭️ What's next: The bill must pass both chambers of Congress before becoming law, facing potential opposition from pro-ESG policymakers
• If successful, it could prompt legal disputes and trade tensions between the US and EU
• US businesses may need to reassess their European operations to navigate potential conflicts between regulatory frameworks

💬 One quote: "This legislation will shield US companies from the EU’s harmful extraterritorial regulations." – Senator Bill Hagerty

📈 One stat: Up to $1 million in fines and three-year federal contract suspensions are proposed as penalties for US companies complying with the CSDDD

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