BAFA Reporting
BAFA reporting requires companies within the scope of the German Supply Chain Due Diligence Act to report annually on how they fulfil their human-rights and environmental due-diligence obligations and to submit to oversight by the federal authority BAFA.
The Federal Office for Economic Affairs and Export Control (BAFA) is the authority responsible for monitoring and enforcing the German Supply Chain Due Diligence Act (Lieferkettensorgfaltspflichtengesetz, LkSG). Companies within the scope of the Act must prepare an annual report on the fulfilment of their due-diligence obligations, retain it for seven years and submit it electronically to BAFA. The report must be filed no later than four months after the end of the financial year and, at the same time, be made publicly available free of charge on the company website for at least seven years.
The report follows a fixed BAFA questionnaire aligned with the due-diligence obligations of Section 3 LkSG: the company sets out whether and how it identified risks in its own operations and at direct suppliers, which preventive and remedial measures it took, how the grievance mechanism is structured and how the effectiveness of measures is reviewed. Where no risk was identified, this too must be plausibly justified. The report must be comprehensible to knowledgeable third parties without disclosing trade secrets.
Beyond reviewing the report, BAFA also monitors LkSG compliance on its own initiative and in response to specific incidents. It may request information, demand documents, enter business premises, order concrete measures and impose coercive penalties and fines; serious breaches may further result in temporary exclusion from public procurement. With the EU Corporate Sustainability Due Diligence Directive (CSDDD) and the Omnibus process, the legal framework is evolving, so companies subject to reporting should keep monitoring deadlines and thresholds.
Legal Basis
Sections 10 and 12 LkSG (documentation and reporting duty), Sections 14 to 24 LkSG (authority oversight, orders, fines); BAFA jurisdiction under Section 19 LkSG
Practical Example
A machinery manufacturer with 4,000 employees has been within the scope of the LkSG since 2024. The compliance officer consolidates the results of the annual risk analysis, the preventive measures launched at two critical steel suppliers and the key figures from the grievance channel. She answers the questionnaire in the electronic BAFA portal, has the draft report approved by management, submits it on time four months after the end of the financial year and publishes the final version on the company website.