Recital 28

(28) Companies established in the Union with more than 1 000 employees on average and a net worldwide turnover exceeding EUR 450 000 000 in the last financial year for which annual financial statements have been or should have been adopted, should be required to comply with the due diligence obligations provided for in this Directive. Companies having entered into franchising or licensing agreements in the Union in return for royalties with independent third-party companies, where those agreements ensure a common identity, a common business concept and the application of uniform business methods, and where those royalties amount to more than EUR 22 500 000 in the last financial year for which annual financial statements have been or should have been adopted, and provided that the company had a net worldwide turnover of more than EUR 80 000 000 in the last financial year for which annual financial statements have been or should have been adopted should also be required to comply with the due diligence obligations provided for in this Directive. The same applies to ultimate parent companies of groups of companies that taken together fulfil those conditions. As regards such ultimate parent companies, the obligations of this Directive should be met by the ultimate parent company or, in the event the latter has as its main activity the holding of shares in operational subsidiaries and does not engage in the taking of management, operational or financial decisions affecting the group or one or more of its subsidiaries, instead of that ultimate parent company by one operational subsidiary established in the Union, in accordance with the conditions provided for in this Directive.

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Source: EUR-Lex CELLAR · retrieved 2026-08-27 · Text as adopted (Official Journal); later amendments are not incorporated in this text.