EU Forced Labour Regulation: Key aspects and practical implications for businesses

The EU Forced Labour Regulation (the “EUFLR”) entered into force on 13 December 2024 and will apply in the EU from 14 December 2027. It applies to all products made with forced labour that are placed, made available on the EU market, or exported from the EU.

The EUFLR applies to all products, including their components, where forced labour was used at any stage of extraction, harvest, production or manufacture irrespective of whether this occurs within or outside the EU. It also applies to products sold online or through other means of distance sales, where the sale is targeted to end users in the EU. By contrast, services, such as transport, warehousing and logistics, are not covered by the EUFLR.

The EUFLR applies to all economic operators regardless of their size, number of employees or sector. It therefore captures not only manufacturers and importers, but also distributors, retailers and online sellers. The prohibition of placing and making available on, or exporting from, the EU market products made with forced labour is unconditional and constitutes an obligation of result for the economic operators. 

For the concept of forced labour, the EUFLR refers to ILO Convention No. 29. Under that convention, forced labour means work or service exacted from any person under the menace of a penalty and not performed voluntarily. In practice, the ILO Convention developed several indicators to identify cases of forced labour, such as threat of physical and sexual violence, abuse of vulnerability, debt bondages, retention of identity documents or threats to report workers to immigration authorities.

The EUFLR does not introduce any new stand-alone due diligence obligation and even expressly states that it does not create additional due diligence obligations other than those already existing under EU or national law, but it does not reduce the practical importance of due diligence. 

In order to ensure compliance, due diligence is critical in practice. In the event of scrutiny, economic operators must be able to demonstrate the step they have taken to identify, prevent, mitigate, end or remediate forced labour risks in their operations and across their supply chains.

In that context, supply chain traceability is essential: without sufficient visibility over suppliers and upstream sourcing, economic operators will be less able to carry out meaningful due diligence, assess risks, remediate issues and defend the placing or making available of their products on their market if investigated by the competent authorities.

How will the EUFLR be enforced?

The EUFLR establishes a three-step investigation process designed to establish whether the forced labour ban has been violated and to determine which measure to impose.

1. Initial assessment 

Competent authorities will first conduct an initial assessment to determine whether there is a substantiated concern that a product may have been made with forced labour. They will apply a risk-based approach, taking into account factors such as the scale and severity of the suspected forced labour, the quantity of products concerned, and the significance of the suspected component in the final product, as well as criteria to determine which economic operators to focus on, such as their proximity to the stages of the value chain where the forced labour is suspected, their size and economic resources, and their leverage to prevent, mitigate and bring to end forced labour. 

The assessment may be triggered by information from various sources, including EU market-surveillance records, the Commission’s forced labour database and risk indicators, complaints submitted through the Single Information Submission Point, information from other authorities, and concerns raised by stakeholders such as trade unions and civil society organisations. 

2. Preliminary investigation

If concerns remain following the initial assessment, the competent authority may open a preliminary investigation. At this stage, it may require the economic operator (unless such a request could jeopardize the outcome of the assessment) to provide relevant information and documentation, including evidence relating to its products, supply chain and suppliers, as well as the measures it has taken to identify, prevent, mitigate or bring forced labour to an end.

While supply chain due diligence is a useful way for economic operators to demonstrate that the products under assessment were not made with forced labour, the EUFLR does not impose any due diligence obligations. Other approaches, such as product traceability, responsible purchasing practices, certification schemes and worker-driven monitoring, can also be effective.

3. Formal investigation

If, following the preliminary investigation, the authority considers that there is a “substantiated concern” that the forced labour ban has been violated by the economic operator under assessment, it must open a formal investigation. During this phase, the competent authority will have the power to collect further information relevant for its assessment including, in exceptional situations, through field inspections.

The economic operator concerned will be informed of the scope of the investigation and, unless it could jeopardise the outcome, the reasons why it has been opened. The economic operator will be able to submit observations and will have the right to be heard.

Enforcement and penalties

If the competent authority concludes that there has been a violation of the forced labour ban, it will adopt a ban-violation decision for the relevant product, including an order to withdraw the product from the EU market. 

As a general rule, withdrawn products must also be disposed of, although the EUFLR provides limited exceptions for products considered strategic or critical.

Member States must also provide for effective, proportionate and dissuasive penalties where economic operators fail to comply with ban-violation decisions. Penalties are not imposed for violating the forced labour ban itself, but e.g. for placing the products on the market in contravention of a ban-violation decision or for failing to withdraw the products in question or to dispose of them, or both, in whole or in part.

The EUFLR does not set a minimum turnover-based fine. Instead, penalties must take into account several elements such as the gravity and duration of the infringement, prior non-compliance, the degree of cooperation with the authorities, and aggravating or mitigating factors such as financial benefits.

Practical implications

The EUFLR does not introduce any specific due diligence obligations. Nevertheless, robust due diligence, supply chain traceability and remediation remain essential for economic operators to ensure that products placed on, made available on, or exported from the EU market are not made with forced labour.

Guidelines 

On 26 June 2026, the European Commission published guidelines on the application of the EUFLR. They are intended to support the consistent application and enforcement of the EUFLR ahead of its date of application. 

Although not legally binding, the guidelines are likely to have significant practical impact by clarifying how national authorities are expected to apply and enforce the EUFLR, and by indicating what economic operators will need to do in practice to ensure compliance. 

In particular, the guidelines are likely to shape expectations regarding the integration of forced-labour due diligence into company policies and risk management systems, supply chain mapping, remediation efforts and the evidence required during investigations. 

What’s next 

Although the EUFLR, as an EU regulation, will apply directly in Luxembourg without the need for transposition, certain national implementing measures will still be required, in particular as regards the designation of the competent authority or authorities and the determination of penalties for infringements. At the time of writing, no Luxembourg competent authority has been formally designated yet.

The EUFLR will apply from 14 December 2027, while Member States must adopt their national rules on penalties and notify them to the European Commission by 14 December 2026. 

From 14 December 2027, the Single Information Submission Point for reporting violations under the EUFLR will be accessible via the Forced Labour Single Portal. Until then, the portal remains available for consultation of guidelines and other resources.