Ottawa to form oversight body to ensure businesses, governments crack down on forced labour

The federal government plans to create an oversight agency as part of a toughening of laws to block foreign goods made with forced labour, measures it says will increase the onus on importers to demonstrate their shipments are free of coerced work.

 

The government said in this week’s fall economic statement that it is planning to introduce legislation to create a “supply chain due diligence regime” that would require governments and businesses to scrutinize their international supply chains for conduct that violates “fundamental labour rights” and “to take action to resolve these risks.”

 

A new agency will be set up to ensure continuing compliance, the government said.

 

“Forced labour is never acceptable anywhere in the world, and we must ensure that our global supply chains remain free of this abuse,” International Trade Minister Mary Ng said in a statement Wednesday.

 

Ottawa said in the statement it will shift responsibility to importers to demonstrate their supply chains are free of forced labour, but it offered no details on how this would work. Up until now, the onus has been on the government to determine if goods are made with coerced labour.

 

The plans build on the efforts of a Senate bill, S-211, that became law in 2023 and requires Canadian companies and government bodies to report publicly on forced labour in their supply chains. The Conservatives backed the governing Liberals in passing that legislation through the Commons.

 

It remains to be seen to what extent Canada will follow the United States in enacting a “reverse-onus” ban on importers from particular areas. The United States enacted the measure in 2021 that presumes any goods from China’s northwestern region of Xinjiang are made from coerced labour of Muslim Uyghurs. That means imports, such as cotton or tomatoes, are barred unless importers can prove they are not tainted by forced labour.

The fall statement also announced $25.1-million over two years, starting on April 1, for both the department of Global Affairs and Canada Border Services Agency to fund the increased oversight.

 

Canada agreed to bar forced-labour imports from entering the country in the United States-Mexico-Canada Agreement (USMCA), which took effect on July 1, 2020.

 

Canada has had a poor record of blocking goods made with forced labour. As of late November, the Canada Border Services Agency had prohibited one shipment of goods – textile products from China – on forced-labour grounds since the USMCA came into force.

 

This year was the first requiring Canadian companies and governments to file reports with Ottawa on forced labour in their supply chains. In the responses, more than 17 per cent of government institutions had identified parts of their activities and supply chains that carry a risk of forced labour or child labour being used. More than 37 per cent had started the process of identifying risks and more than 44 per cent had not started identifying risks.

 

Of private-sector respondents, more than 38 per cent said they had identified parts of their activities and supply chains that carry a risk of forced labour or child labour being used, more than 39 per cent had just started the process and more than 22 per cent had not started identifying risks.

 

Liberal MP John McKay, one of the sponsors of S-211, said he is glad to see Ottawa going further on forced labour. He said the numbers suggest many governments and agencies across Canada are not filing reports. “It is not an issue that is going to go away any time soon; the data generated by S-211 shows that Canada has a significant problem.”

 

It’s not clear when the Liberal government will be able to move new legislation through the House of Commons.

 

Other than a brief exception, the government has not been able to put forward any bills or motions for debate in the Commons since Sept. 26. That’s when the Conservatives launched a form of procedural protest over the government’s refusal to fully release documents related to a green technology fund that the Commons requested through a motion in June.

 

The government tabled a fall economic statement Monday that made several references to future legislative changes, but no related government bill was introduced before the House rose for the holidays.

 

Sittings are not scheduled to resume until Jan. 27.

 

Mr. McKay said he thinks the federal cabinet could use an order in council to implement a reverse-onus ban that bars goods from a particular region unless the importer can prove they are free of slave labour.

 

The government has released no estimate of the value of imports into Canada made with slave labour. However, the Global Slavery Index, produced by the Australian philanthropic Minderoo Foundation’s Walk Free initiative, estimated in a 2018 report that more than $18.5-billion worth of goods imported annually into Canada is at risk of being made with forced labour at some point in the supply chain, including computers, smartphones, clothing, gold, seafood and sugar cane.

Canada has identified China’s Xinjiang region as plagued by forced labour. A 2022 report for the Department of Global Affairs said that, in Xinjiang, China “is using otherwise legitimate programs for retraining and relocation of unemployed workers as instruments of a broader campaign of oppression, exploitation and indoctrination of the Uyghur Muslim population into Han Chinese culture.”

 

The report for Global Affairs said “nonvoluntary participation in retraining and relocation programs provides forced labour to the bottom of the supply chains for textiles and apparel, food products, and semi-conductor-based products, including solar panels.”

 

It said Canada imported more than $5-billion in apparel products from China in 2020, much of it including cotton, and an estimated 85 per cent of Chinese cotton originates in Xinjiang. Experts interviewed for this report said “products made wholly or in part from cotton represent perhaps the largest risk of supply chain forced labour to Canadian firms.”

 

Karen Hamilton, director of Above Ground, a human-rights and corporate accountability project, said her group would welcome legislative amendments to bolster enforcement of the import ban, “provided they are designed with workers and worker-led strategies in mind.”

 

Any amendments, she said, should provide remediation for harmed workers. She noted that the current plans lack details on what amendments the government is proposing.

 

 

 

 

This article was first reported by The Globe and Mail