Germany is planning to oppose an EU rule that would require large companies to take action if they find their supply chains either damage the environment or use child labor, based on a letter from two German ministers.

According to Reuters, the letter, sent February 1 by Finance Minister Christian Lindner and Justice Minister Marco Buschmann, said that the German government would abstain on the issue.

"In the Council of the European Union, this results in Germany abstaining, which ultimately has the effect of a ‘no’ vote," the letter said, which was addressed to business groups according to government sources. "We can also expect significant additional financial, personnel and also bureaucratic burdens for our companies,”

German businesses and industry bodies have criticized the proposal, arguing that the law could create significant bureaucratic processes and legal uncertainties.

"German industry is relieved," said Siegfried Russwurm, the president of the Federation of German Industries (BDI). "It's good that Berlin doesn't support this wrong path."

The piece of legislation could be formally signed as soon as next week and could see companies face fines equal to 5% of their global sales if they're found to be breaching the rule.

If approved, the rule will apply to European companies that employ over 500 people and have a net worldwide turnover of at least 150 million euros ($162.45 million). The rule will also apply to non-European companies if they have more than 150 million euros of net turnover generated in the EU three years after the law comes into effect.