NMPF and USDEC filed comments with the European Union on Aug. 13, urging it to ensure that its Corporate Sustainability Due Diligence Directive does not impose new burdens on how U.S. dairy farmers and companies operate. The organizations submitted the comments in response to an EU call for public input as it develops its implementation guidance materials for the directive.
The directive, first published in the EU Official Journal in July 2024 and most recently updated last December, requires companies operating in the European Union to undertake steps to monitor and address risks related to environmental and labor practices throughout their supply chain. As drafted, this could result in companies pushing requests for data, audits and other due diligence demands onto upstream dairy suppliers. An overly aggressive approach to implementation could mean additional demands on individual dairy farmers, even when those farmers do not directly supply an EU buyer or when their milk is used for products sold outside Europe.
NMPF and USDEC argued in its comments that the European Union should not be able to impose its sustainability standards on U.S. farms operating under U.S. law and called for the requirements to be limited to direct suppliers while exempting small and medium-sized businesses such as farms from these types of invasive information requests.
“It is entirely inappropriate for the EU to seek to effectively dictate global environmental and labor sustainability parameters, regardless of where the production is taking place and the relevant laws within that jurisdiction. We believe that the EU should make further revisions to the CSDDD in order to address these concerns and focus the scope of its regulatory measures on production practices occurring within its own border,” the comments said.
“For the purposes of satisfying EU CSDDD requirements, any data requests by in-scope EU companies should be limited to companies that are directly supplying them and should omit small and medium-size enterprises (SMEs),” NMPF and USDEC continued.
The groups also urged the European Union to recognize the United States as a lower-risk jurisdiction, rely primarily on official government records when assessing risks and use compliance with U.S. law as the appropriate benchmark for U.S. operations. Collectively, these measures would reduce the risk of EU companies requiring extensive data from U.S. processors and farmers.
NMPF also is pressing the U.S. government to address these concerns in ongoing trade negotiations with the European Union and is supporting the Stop EU Overreach Act, introduced in July by Reps. Craig Goldman, R-TX, Jodey Arrington, R-TX, and Greg Steube, R-FL.
The legislation would direct the U.S. Trade Representative to initiate a Section 301 investigation into EU sustainability measures with extraterritorial reach, including the due diligence directive, and consider appropriate use of trade tools to ensure U.S. dairy farmers are not forced to comply with overreaching EU policies. USTR comments submitted to the European Union on the directive reflected many NMPF arguments.
