CSDDD Article 29 civil liability FAQ

Article 29 says Member States must ensure that a company can be held liable for damage caused to a natural or legal person only when two core conditions are met. First, the company intentionally or negligently failed to comply with the CSDDD duties in Articles 10 and 11, and the relevant right, prohibition, or obligation in the Directive Annex is aimed at protecting that person. Second, that failure caused damage to the person's legal interests that are protected under national law.

That means teams should not describe CSDDD civil liability as automatic, strict, or triggered merely because an adverse impact occurred somewhere in the chain of activities. The Article 29 analysis has to identify the due diligence duty, the protected person, the protected legal interest, the alleged fault, and the causal link.

Article 29 contains important limits. A company cannot be held liable under Article 29 where the damage was caused only by its business partners in the chain of activities. Participation in industry initiatives, multi-stakeholder initiatives, third-party verification, or contractual clauses also does not automatically protect a company from liability, but those measures may still be relevant evidence of how the company implemented due diligence.

Civil liability is separate from supervisory enforcement and administrative penalties. For damages, Article 29 is about compensation for proven harm, not public fines or headline penalty percentages.

If a company is held liable under Article 29, the injured natural or legal person has the right to full compensation in accordance with national law. The same paragraph states that full compensation must not lead to overcompensation through punitive, multiple, or other types of damages.

Article 29 also sets procedural safeguards for damages actions. Limitation periods must not unduly hamper claims, must not be more restrictive than national general civil liability rules, and must be at least five years. The period must not begin before the infringement has ceased and the claimant knows, or can reasonably be expected to know, the behaviour and infringement, the fact that it caused harm, and the identity of the infringer.

Article 29 expects evidence to matter. When a claimant provides a reasoned justification with reasonably available facts and evidence supporting the plausibility of a damages claim, and indicates that additional evidence is controlled by the company, courts must be able to order company disclosure under national procedural law.

The useful evidence file is therefore not a generic compliance memo. It should show what the company knew, how it assessed severity and likelihood, why it prioritised particular adverse impacts, what prevention or mitigation measures it used, what monitoring showed, and whether any remaining damage was caused by company failure or only by other actors.