Canada Introduces Mandatory Forced Labour Prevention Reporting Legislation

On May, 3, 2023, the House of Commons passed Bill S-211, An Act to enact the Fighting Against Forced Labour and Child Labour in Supply Chains Act and to amend the Customs Tariff (the Act). The Act introduces a public reporting requirement that will apply to many government institutions and private sector entities. It enters into force on January 1, 2024, and the first reports will be due on or before May 31, 2024.

Relevant private sector entities include organizations that:

1. produce, sell or distribute goods in Canada or elsewhere;
2. import into Canada goods produced outside Canada; or
3. control an entity engaged in any activity described in paragraph (a) or (b), with control defined broadly as any direct or indirect control or common control "in any manner."

An "entity" is defined as a corporation or a trust, partnership or other unincorporated organization that:

1. is listed on a stock exchange in Canada;
2. has a place of business in Canada, does business in Canada or has assets in Canada and that, based on its consolidated financial statements, meets at least two of the following conditions for at least one of its two most recent financial years:
   1. it has at least C$20 million in assets,
   2. it has generated at least C$40 million in revenue, and
   3. it employs an average of at least 250 employees;

   or

3. is otherwise prescribed by regulations, which have yet to be enacted.

For more information about the Act and what it means for Canadian businesses, please see our previous insight.

There are a variety of practical strategies that companies can take to prevent and mitigate the risk of forced labour and child labour in their supply chains. Contact a member of the Bennett Jones International Trade and Investment or ESG practice groups to discuss methods to implement robust compliance procedures, governance measures, risk mitigation strategies and systems to deal with internal investigations in order to prevent and combat forced labour and child labour.