The state of play of the European fight against forced labor

In March 2026 the United States of America launched an investigation into 60 trade partners suspecting they may have an unfair competitive advantage because they profit from forced labor. The report summarizing the investigation’s results claims that the European Union and others are failing to effectively combat the importation of goods produced with forced labor. The investigators recommend levying tariffs between 10 and 12.5 percent to pressure the investigated trade partners into policy changes and to lessen their alleged competitive advantage. Bavarian industry and the European Union have taken a strong stance against forced labor in the past.

Company activities combatting forced labor

Bavarian companies uphold high standards in their practices. They follow the law and choose business partners carefully. A business relationship with someone who violates labor

standards or even human rights would be extremely damaging to companies. Therefore, they have a strong interest in upholding standards. Past examples demonstrate that companies will no longer source products from regions if they learn that labor rights are not upheld there or if they cannot be sure of the conditions under which production takes place.

EU activities combatting forced labor

The European Union has taken measures against the use of forced labor. The so-called “Forced Labour Regulation” ( Regulation (EU) 2024/3015 ) prohibits placing products made with forced labor on the Union market and exporting such goods from the European Union. The Corporate Sustainability Due Diligence Directive ( Directive (EU) 2024/1760 ) requires companies to identify and address adverse human rights impacts of their actions inside and outside Europe. As global supply chains are complex, the implementation is complicated and companies’ ability to influence the actions of all organizations in their supply chains is limited. Thus, the effectiveness of these regulations has to be carefully assessed, and their implementation should be made easier.

International agreements

Free trade agreements and other international agreements contain commitments to fighting forced labor. One example is the interim trade agreement between the EU and the Mercosur. In it the signatories commit to the elimination of all forms of forced or compulsory labor.

Notably, the so called “Turnberry-Agreement” between the European Union and the United States references the fight against forced labor. In the agreement the trade partners commit to working together to ensure strong protection of internationally recognized labor rights and to advance the elimination of forced labor in global supply chains.

Open questions and next steps

It remains to be seen whether the US investigation will be used to justify new tariffs on European imports. Either way the investigation and its results underscore the limitations of the “deal” between the United States and the European Union. It seems that the United States either do not feel bound by their commitment to cooperate in the fight against forced labor or that the United States does not consider the investigation and new tariffs hurdles to such cooperation. Thus, the investigation and its results point to a need for a clear and reliable framework on transatlantic trade.

In the coming weeks the European Union and EU businesses can highlight European instruments in the fight against forced labor and their effectiveness vis-à-vis the United States. A productive dialogue is in the interest of both trade partners as it can help avoid an escalation of the trade conflict and as it may reduce doubts about the “deal” struck between the European Union and the United States.