Due diligence for small operators

Due diligence for small operators is the same evidence test applied in proportion to size, position in the chain, and leverage over suppliers. A small operator cannot be expected to run the same audit programme as a large manufacturer, but a small operator also cannot treat size alone as a reason to hold no records. The first step is a scope decision under Article 47, which sets a turnover limit below which Chapter VII does not apply to an operator that is not part of a larger group exceeding the limit. The turnover figure and the group test must be checked in the current consolidated text, because amendment work has proposed a higher limit. Operators outside the scope should still keep the records that customers and the passport may require.

A small operator, in this record, means an economic operator with limited turnover, staff, and leverage in the battery supply chain. Proportionality means matching the depth of checks to risk, size, and position, while keeping the method and the gaps visible.

What is the legal frame for this record?

Due diligence for small operators sits inside that sequence, so a record that shows only one step leaves the chain of reasoning incomplete. A small importer buying finished packs from one overseas manufacturer therefore needs a file that shows the policy, the owner of the policy, the date of adoption, and the review cycle. A small importer might rely on the manufacturer due diligence report and verification, but must record the report date, scope, and limits, and must not present reliance on another operator as its own verification.

How is the chain mapped?

The map should name each tier that handles due diligence for small operators, record the function of each actor, and note where material changes form, such as refining, precursor production, cathode production, cell production, and pack assembly. The scope decision, supplier requests, and gap log should be tied to a named tier, a named site where that information is known, and a date. A small importer buying finished packs from one overseas manufacturer should record gaps on the map itself, with the reason for each gap and the next step planned. Leverage can be increased by acting with other buyers, by using recognised schemes, and by setting clear purchase conditions, and the record should show which route was used and what it produced.

How is evidence judged?

A supplier statement, a contract clause, a third party audit summary, a mass balance record, and a chain of custody document do not carry equal weight, and the record should say which type supports each claim about due diligence for small operators. The scope decision, supplier requests, and gap log needs a source name, a collection date, a coverage period, and a statement of what was actually checked. A small importer buying finished packs from one overseas manufacturer should separate facts received from conclusions drawn, so a later reviewer can test the conclusion. A small importer might rely on the manufacturer due diligence report and verification, but must record the report date, scope, and limits, and must not present reliance on another operator as its own verification.

How is risk identified and assessed?

A red flag can be a place of origin, a processing route, a supplier practice, a change of ownership, or a gap in records for due diligence for small operators. Leverage can be increased by acting with other buyers, by using recognised schemes, and by setting clear purchase conditions, and the record should show which route was used and what it produced. A small importer buying finished packs from one overseas manufacturer should date each assessment and name the person or function responsible for the next review.

How is mitigation planned and followed up?

For due diligence for small operators, the plan should state the risk addressed, the action chosen, the supplier or site involved, the support offered, and the evidence that will show whether the action worked. The scope decision, supplier requests, and gap log collected after the action should be compared with the position before the action, using the same measure where possible. A small importer might rely on the manufacturer due diligence report and verification, but must record the report date, scope, and limits, and must not present reliance on another operator as its own verification.

How is reporting checked?

The due diligence report should summarise the policy, the management system, the risks found, the actions taken, and the verification arranged for due diligence for small operators, without disclosing confidential commercial detail that the Regulation does not require to be published. A small importer buying finished packs from one overseas manufacturer should check that every public claim can be traced to an internal record, and that the report date, coverage period, and scope match the internal file. Leverage can be increased by acting with other buyers, by using recognised schemes, and by setting clear purchase conditions, and the record should show which route was used and what it produced.

What file can a two person importer realistically hold?

A two person importer can hold a small but complete file: a scope decision with the turnover and group test, a supplier list with one contact per supplier, a request log, the responses received, a gap log, and a copy of the manufacturer due diligence report relied on, with its date, scope, and limits noted. The file should also hold the purchase conditions that require supplier data, and a review date. A worked file for one model shows three suppliers, two responses received, one gap logged with a follow up date, and a report sentence that is limited to the evidenced quantity. The file is proportionate because it matches the size of the operation, and it is complete because every quantity is either evidenced or logged as a gap.

Proportionality is a reasoned limit, not an absence of records, and a small file that shows its limits is stronger than a large file that hides them.