---
title: "CSDDD Chain of Activities Boundaries"
canonical_url: "https://www.sorena.io/artifacts/eu/csddd/chain-of-activities-boundaries"
source_url: "https://www.sorena.io/artifacts/eu/corporate-sustainability-due-diligence-directive/chain-of-activities-boundaries"
author: "Sorena AI"
description: "Define CSDDD upstream and downstream chain of activities boundaries for subsidiaries, direct and indirect business partners, distribution, transport, storage, and records."
published_at: "2026-05-09"
updated_at: "2026-05-09"
keywords:
  - "CSDDD chain of activities"
  - "Directive 2024/1760"
  - "upstream business partners"
  - "downstream business partners"
  - "direct business partner"
  - "indirect business partner"
  - "subsidiaries"
  - "distribution transport storage"
  - "CSDDD"
  - "EU Corporate Sustainability Due Diligence Directive"
  - "chain of activities"
  - "distribution"
  - "transport"
  - "storage"
---
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---

# CSDDD Chain of Activities Boundaries

Define CSDDD upstream and downstream chain of activities boundaries for subsidiaries, direct and indirect business partners, distribution, transport, storage, and records.

*CSDDD* *Boundary map* *EU*

## CSDDD Chain of activities boundaries

Draw the CSDDD boundary between own operations, subsidiaries, upstream business partners, and limited downstream product activities.

Use the boundary record to decide which entities, activities, partners, and evidence records belong in the due diligence file.

Under the Corporate Sustainability Due Diligence Directive, the chain of activities is not the same as the whole value chain. It covers a company's own operations and subsidiaries through the due diligence duties, then defines which business-partner activities count upstream and which downstream product activities count only when they are carried out for or on behalf of the company.

## Start with the legal boundary

Build the boundary map in three layers. First list the company's own operations. Second list subsidiaries, because CSDDD due diligence covers actual and potential adverse impacts arising from the company's own operations or those of its subsidiaries. Third list business partners only where their activities relate to the company's chain of activities.

The directive defines a direct business partner as an entity with a commercial agreement related to the company's operations, products, or services, or an entity to which the company provides services under the chain-of-activities definition. An indirect business partner is not direct, but performs business operations related to the company's operations, products, or services.

For borderline cases, use the chain test: include the partner if its activity is part of producing, moving, storing, or servicing the company's goods or services, and exclude it if the link is only a general commercial relationship. For downstream services, include distribution, transport, and storage only when the partner acts for or on behalf of the company.

- Own operations: sites, functions, employment relationships, purchasing decisions, product design, service delivery, and other activities controlled by the company.
- Subsidiaries: legal persons or controlled undertakings whose operations must be mapped separately, even if a parent company supports group-level due diligence.
- Direct business partners: contracted suppliers, manufacturers, logistics providers, distributors, or service partners connected to the company's operations, products, or services.
- Indirect business partners: lower-tier or non-contracted entities that perform related operations, such as sub-suppliers, raw-material processors, or other actors in the relevant production or service chain.
- Borderline partners: outsourced transport, shared distribution, and mixed-purpose service providers belong in scope only for the covered activity that is linked to the company's operations or products, and only if that activity sits in the chain of activities.

Sources for this answer:

- [Directive (EU) 2024/1760 on corporate sustainability due diligence](https://eur-lex.europa.eu/eli/dir/2024/1760/oj?ref=sorena.io) - Article 3 defines subsidiary, direct business partner, indirect business partner, and chain of activities for CSDDD boundary mapping.
- [EUR-Lex summary of Directive (EU) 2024/1760](https://data.europa.eu/eli/dir/2024/1760/oj/eng?ref=sorena.io) - The summary states that companies assess impacts in their own operations, subsidiaries, business partners, and chains of activities.

*Recommended next step*

*Placement: after evidence section*

## Turn the boundary map into evidence

Use Sorena to keep CSDDD chain-of-activities classifications tied to the source rule, partner record, contract evidence, and monitoring review.

- [Open Research Copilot](/solutions/research-copilot.md): Check CSDDD boundary questions against cited source material.
- [Discuss CSDDD implementation](/contact.md): Review chain-of-activities boundaries, partner evidence, and next implementation steps with Sorena.

## Separate upstream from downstream

Upstream coverage is broad. It includes activities of upstream business partners related to production of goods or provision of services by the company, including design, extraction, sourcing, manufacture, transport, storage, supply of raw materials, products or product parts, and development of the product or service.

Downstream coverage is narrower. It covers activities of downstream business partners related to distribution, transport, and storage of the company's product only where those partners carry out those activities for the company or on behalf of the company. The directive does not make ordinary customer use, product disposal, or unrelated downstream services part of this definition.

- Include upstream design, extraction, sourcing, manufacture, transport, storage, raw-material supply, product-part supply, and product or service development.
- Include downstream distribution, transport, and storage only for company products and only when performed for or on behalf of the company.
- Exclude product disposal from the CSDDD chain-of-activities definition unless another law or internal commitment creates a separate obligation.
- Exclude downstream services of the company from the chain-of-activities definition; for regulated financial undertakings, downstream partners receiving services and products are not included.

Sources for this answer:

- [Directive (EU) 2024/1760 on corporate sustainability due diligence](https://eur-lex.europa.eu/eli/dir/2024/1760/oj?ref=sorena.io) - Article 3(g) gives the upstream list and limits downstream coverage to distribution, transport, and storage carried out for or on behalf of the company.
- [Directive (EU) 2024/1760 on corporate sustainability due diligence](https://eur-lex.europa.eu/eli/dir/2024/1760/oj?ref=sorena.io) - Recital 25 explains that the directive should not cover product disposal and should not include certain export-controlled downstream activities after authorisation.

## Record subsidiaries and group-level support separately

A parent company may fulfil certain CSDDD obligations on behalf of in-scope subsidiaries where the conditions in Article 6 are met, but that does not erase the subsidiary from the boundary map. The subsidiary and parent must provide each other necessary information, the subsidiary must integrate due diligence into its policies and risk management systems, and the subsidiary remains subject to supervisory powers and civil liability.

For boundary evidence, keep one record for the group-level allocation and another record for each subsidiary's operational perimeter. This avoids the common mistake of treating a group policy as proof that subsidiary-specific operations, partners, and impacts have been mapped.

- Name each in-scope subsidiary and its operational perimeter, including products, services, sites, and business-partner categories.
- Identify which obligations the parent performs and which obligations the subsidiary continues to perform directly.
- Keep the information-sharing record that shows how the parent and subsidiary exchange documents needed for due diligence.
- Track subsidiary-specific direct and indirect business partners when they relate to that subsidiary's chain of activities.

Sources for this answer:

- [Directive (EU) 2024/1760 on corporate sustainability due diligence](https://eur-lex.europa.eu/eli/dir/2024/1760/oj?ref=sorena.io) - Article 6 allows parent-level support only under conditions and preserves subsidiary supervision and civil liability.
- [EUR-Lex summary of Directive (EU) 2024/1760](https://data.europa.eu/eli/dir/2024/1760/oj/eng?ref=sorena.io) - The summary confirms that due diligence covers companies' own operations, subsidiaries, and chains of activities.

## Use direct and indirect partner labels for controls

The direct or indirect label matters because CSDDD uses it in the control design. Prevention and corrective measures can include contractual assurances from direct business partners, cascading assurances to partners where their activities are part of the chain of activities, and, where impacts cannot otherwise be addressed, assurances from indirect business partners.

Do not classify every lower-tier supplier as out of reach. Article 8 requires mapping business partners where related to the chain of activities and directs companies to request information, where reasonable, from business partners at the levels where adverse impacts are most likely to occur.

- For each direct partner, store the agreement, covered activities, product or service link, assurance clause, verification route, and SME support decision where relevant.
- For each indirect partner that is material to a likely or severe impact, store the activity performed, how it was identified, the information source, and any assurance or engagement route.
- When information can come from different chain levels, document why the request went to the partner level where the adverse impact is most likely to occur.
- If an activity is outside the chain of activities, record the exclusion reason rather than leaving the partner unclassified.

Sources for this answer:

- [Directive (EU) 2024/1760 on corporate sustainability due diligence](https://eur-lex.europa.eu/eli/dir/2024/1760/oj?ref=sorena.io) - Articles 8, 10, and 11 connect mapping, contractual assurances, verification, and indirect-partner measures to the chain of activities.
- [Directive (EU) 2024/1760 on corporate sustainability due diligence](https://eur-lex.europa.eu/eli/dir/2024/1760/oj?ref=sorena.io) - Article 8 states that information requests should prioritise the partner level where adverse impacts are most likely to occur when reasonable.

## Keep evidence that proves the boundary

A defensible boundary file should let a reviewer reproduce the classification. It should show the product or service, the entity, the partner relationship, the activity performed, the upstream or downstream side, the inclusion or exclusion rule, the source citation, and the owner who approved the decision.

The record should also connect to due diligence monitoring. Article 15 requires periodic assessments of the company's own operations and measures, those of subsidiaries, and, where related to the chain of activities, those of business partners. Boundary records should therefore be reviewed after significant changes and against regular monitoring outputs.

- Boundary register: entity, subsidiary, product or service, activity, upstream or downstream side, direct or indirect partner status, and inclusion outcome.
- Downstream limit evidence: distribution, transport, or storage contract showing whether the partner acts for or on behalf of the company.
- Exclusion log: product disposal, customer use, export-controlled downstream activity after authorisation, downstream services, or regulated-financial downstream recipient exclusions, with the cited rule.
- Information record: data requested, partner level contacted, reason for that level, response received, and gaps still being pursued.
- Review record: significant-change trigger, at-least-annual monitoring result, owner approval, and changes made to the due diligence policy or controls.

Sources for this answer:

- [Directive (EU) 2024/1760 on corporate sustainability due diligence](https://eur-lex.europa.eu/eli/dir/2024/1760/oj?ref=sorena.io) - Article 15 requires periodic assessment of operations, subsidiaries, and business partners where related to the chain of activities.
- [EUR-Lex summary of Directive (EU) 2024/1760](https://data.europa.eu/eli/dir/2024/1760/oj/eng?ref=sorena.io) - The summary notes regular monitoring and a five-year documentation retention expectation for due diligence compliance.

## Primary sources

- [Directive (EU) 2024/1760 on corporate sustainability due diligence](https://eur-lex.europa.eu/eli/dir/2024/1760/oj?ref=sorena.io) - Primary legal text for CSDDD definitions of subsidiary, direct and indirect business partner, chain of activities, downstream limits, group-level support, partner measures, and monitoring.
  - Quote: "chain of activities"
- [EUR-Lex summary of Directive (EU) 2024/1760](https://data.europa.eu/eli/dir/2024/1760/oj/eng?ref=sorena.io) - EUR-Lex summary used to cross-check the plain-language description of due diligence coverage, monitoring, communication, and documentation.
  - Quote: "subsidiaries and business partners"

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