EU Due Diligence Rules Pose Economic and Security Risks for U.S. Companies

A commentary warns that the EU's Corporate Sustainability Due Diligence Directive could force American firms to share sensitive supply-chain data, creating costly compliance burdens and potential national-security concerns.

The article contends that the European Union’s Corporate Sustainability Due Diligence Directive (CSDDD) represents more than a regulatory hurdle; it could compel U.S. companies tied to European markets to collect and share detailed supply-chain information that may expose strategic weaknesses. While EU legislators present the rule as a sustainability and human-rights safeguard, the author warns that the data could be used by foreign actors, notably China, to map Western industrial capabilities.

An example of perceived EU hypocrisy is highlighted: the bloc granted TotalEnergies an exemption to continue certain Russian LNG activities, citing market-security concerns. Researchers estimate that U.S. manufacturers could face between $211 billion and $267 billion in upfront compliance costs, a burden that would cascade to smaller suppliers. The commentary urges Congress to treat the issue with urgency and directs the U.S. Trade Representative to examine whether the CSDDD unfairly threatens American commerce and national security. Ultimately, the piece frames the directive as an economic and security threat that requires coordinated policy response.