Regulation (EU) 2023/1542 places binding battery supply chain due diligence obligations on manufacturers and other economic operators that place batteries on the EU market. These obligations sit in Chapter VII, Articles 48 to 52, and they cover four specific raw materials: cobalt, natural graphite, lithium, and nickel. If your company meets the turnover threshold set out in Article 47, you must have a documented policy, a functioning management system, a third-party audit, and a summary of your due diligence in the battery passport. This article explains each requirement in plain terms.
Who Must Comply: The Article 47 Scope Threshold
Article 47, headed “Scope of this Chapter”, sets the boundary for who these obligations apply to. Economic operators whose net turnover was below EUR 40 million in the financial year preceding the last financial year fall outside Chapter VII entirely. This is a scope exclusion, not a partial exemption from one specific requirement. If your company is below the threshold, Articles 48 to 52 do not apply to you at all.
There is one important qualification. If your company belongs to a group, the threshold is assessed on a consolidated basis across the group. A subsidiary with EUR 15 million in turnover is still in scope if its parent group exceeds EUR 40 million on a consolidated basis.
If you are in scope, the obligations apply regardless of where in the supply chain you sit. The regulation uses the term “economic operators”, which covers manufacturers, importers, and authorised representatives placing batteries on the EU market.
When Do the Battery Supply Chain Due Diligence Obligations Apply?
The original application date for Chapter VII was 18 August 2025. Regulation (EU) 2025/1561 amended Article 48(1) and postponed that date to 18 August 2027. You now have additional time to build your systems, but the requirements themselves have not changed.
The Commission was originally required to publish due diligence guidelines by 18 February 2025. That deadline has also moved. Under the amended regulation, the Commission must publish its guidelines by 26 July 2026. Those guidelines will provide practical detail on how to implement the OECD Guidance in the context of the Battery Regulation, so monitoring their publication matters for your implementation planning.
The Four Materials in Scope
Chapter VII applies specifically to supply chains for four materials: cobalt, natural graphite, lithium, and nickel. These materials appear in battery cells and components across the supply chain, from mining through processing to cell manufacturing. Your due diligence obligations cover the full upstream supply chain for these four materials, not just your direct suppliers.
The OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas defines the framework you must follow. Article 48(1) requires that your due diligence policy be consistent with this guidance. The OECD Guidance sets out a five-step framework: establish strong company management systems, identify and assess risks in the supply chain, design and implement a strategy to respond to identified risks, carry out independent third-party audits, and report annually on supply chain due diligence.
What You Must Document: The Four Core Requirements
1. A Company-Level Due Diligence Policy
Article 48(1) requires economic operators to adopt and communicate a company-level supply chain due diligence policy. The policy must be publicly available. It must be consistent with the OECD Guidance and must set out the standards your company applies when sourcing cobalt, natural graphite, lithium, and nickel through your supply chain.
A publicly available policy means it must be accessible to anyone, not just your customers or auditors. Publishing it on your company website satisfies this requirement, provided the content meets the standard set by the OECD Guidance. A vague statement of intent does not. The policy must describe the specific standards you apply and how you communicate them to suppliers.
2. A Supply Chain Management System
Article 48(1) also requires a management system that identifies and addresses social and environmental risks in the supply chain. This is an operational requirement, not a documentation exercise. You must be able to demonstrate that your company actively maps its supply chain for the four in-scope materials, assesses risks at each stage, and takes action when risks are identified.
Social risks include child labour, forced labour, and unsafe working conditions in mining and processing operations. Environmental risks include land degradation, water contamination, and failure to manage tailings from mineral extraction. The OECD Guidance provides detailed risk indicators for each of these categories.
Your management system must also include a mechanism for suppliers to raise concerns, and a process for escalating and resolving those concerns. Keeping records of how risks were identified and what action was taken is part of operating the system, not an optional extra.
3. Third-Party Verification
Article 48(2) requires independent third-party audits of the supply chain management system. The auditor must be independent of the economic operator and of the suppliers being audited. The audit assesses whether your management system conforms to the requirements of Article 48(1) and the OECD Guidance.
Third-party audits are not self-assessments. You cannot satisfy this requirement by having an internal team review your own processes. The auditor must be a body that has no commercial relationship with your company that could compromise its independence.
The regulation does not specify a fixed audit frequency in Article 48(2), but the OECD Guidance recommends annual audits for smelters and refiners in high-risk supply chains. Your audit programme should be designed to cover the full scope of your supply chain for the four in-scope materials.
4. Due Diligence Summary in the Battery Passport
The battery passport is required under Article 77 of Regulation (EU) 2023/1542. It must contain a summary of your supply chain due diligence. This connects the Chapter VII obligations directly to the digital product passport infrastructure that the regulation establishes.
The summary in the passport is not the full policy or audit report. It is a structured summary that allows downstream users, market surveillance authorities, and the Commission to verify that due diligence has been carried out. The specific data points required in the battery passport are set out in Annex XIII. Point 1 of Annex XIII covers information accessible to the public, and Annex XIII 1(a) incorporates Annex VI Part A, which includes the due diligence summary among the information the passport must carry.
For manufacturers building their battery passport systems, this means the due diligence documentation cannot sit in a separate internal folder. It must feed into the passport data structure in a form that can be accessed and verified.
How the Requirements Connect to Each Other
The four requirements are not independent. The policy sets the standards. The management system implements them. The third-party audit verifies the system. The battery passport summary reports the outcome. A gap in any one of these breaks the chain.
Regulators and market surveillance authorities will be able to check the battery passport summary against the audit reports. If the summary claims conformity with the OECD Guidance but no audit has been carried out, or if the audit covers only tier-one suppliers while the policy claims full upstream coverage, that inconsistency will be visible.
This is why documentation discipline matters from the start. The records you keep during risk assessments, supplier engagement, and corrective action processes are the evidence base for both the audit and the passport summary.
Practical Steps to Prepare Before August 2027
The postponement to 18 August 2027 gives companies more time, but the volume of work required means starting early is sensible. Here is a practical sequence:
- Confirm whether your company is in scope under Article 47. Check your net turnover for the financial year preceding the last financial year, and check on a consolidated group basis if applicable.
- Map your supply chain for cobalt, natural graphite, lithium, and nickel back to the smelter or refiner level. This is the baseline for risk assessment.
- Draft and publish your company-level due diligence policy, aligned with the OECD Guidance five-step framework.
- Build or adapt your management system to identify, assess, and respond to social and environmental risks across the mapped supply chain.
- Select an independent third-party auditor and schedule your first audit well before the August 2027 deadline, so you have time to address any findings.
- Work with your battery passport provider to ensure the due diligence summary can be populated and updated in the passport data structure.
- Monitor the Commission’s due diligence guidelines, expected by 26 July 2026, and update your systems if the guidelines require adjustments.
For a detailed breakdown of how these obligations interact with the battery passport data requirements, see the EU Battery Regulation supply chain due diligence obligations section of the Traceable regulatory library.
Penalties and Enforcement
Regulation (EU) 2023/1542 requires member states to establish penalties for infringements, including infringements of the Chapter VII due diligence obligations (Article 89). The regulation specifies that penalties must be “effective, proportionate and dissuasive”. Member states set the specific penalty levels in national law. Market surveillance authorities have the power to require corrective action and, where necessary, to restrict or prohibit the placing of non-compliant batteries on the market.
Non-compliance with the due diligence requirements is therefore not only a documentation risk. It is a market access risk. A battery that cannot demonstrate a compliant due diligence process may be blocked from the EU market entirely.
Traceable helps manufacturers build and maintain the documentation systems required under Articles 48 to 52, including battery passport integration. Visit traceable.digital/pricing to see the available plans and start a free trial.
