Question Period Note: FORCED LABOUR (GLOBAL SUPPLY CHAINS)

What is the Labour Program doing to fulfill the Minister of Labour and Seniors’ mandate letter commitment to introduce legislation to eradicate forced labour from Canadian supply chains and ensure that Canadian businesses operating abroad do not contribute to human rights abuses?

• The Government of Canada remains committed to introducing legislation in 2024 to address forced labour in Canada’s global supply chains.

• The legislation will include due diligence measures and will be strong, effective, and enforceable.

• Supply chain legislation is just one tool, among many, needed to address forced labour and other forms of exploitation. Work continues on a number of other initiatives to tackle the issue of labour exploitation in supply chains.

• The Government will continue to work closely with stakeholders and international partners to address exploitation in supply chains.

[Responsive lines on the Fighting Against Forced Labour and Child Labour in Supply Chains Act:]
• An Act to enact the Fighting Against Forced Labour and Child Labour in Supply Chains Act and to amend the Customs Tariff came into force on January 1, 2024. Federal departments are working with Public Safety Canada as they seek to implement the Act.

• Although the Government recognizes that the Act may serve as an important first step, more is needed.

• The Government remains committed to introducing supply chain legislation that is strong, effective, and enforceable.

[Responsive line on the import ban on goods produced with forced labour, which falls under CBSA’s/the Minister of Public Safety’s enforcement authority:]

• The Canada Border Services Agency is responsible for the enforcement of the import ban, and federal departments are working together to strengthen the regime.

Global Estimates
• According to 2021 data, the International Labour Organization estimates that there are 27.6 million victims of forced labour worldwide
o Women and girls make up 11.8 million of the total in forced labour.
o More than 3.3 million of all those in forced labour are children.

• World Vision estimates that nearly $48 billion in goods imported into Canada in 2021 were at risk of being made with forced and/or child labour.

International and Domestic Efforts
• Internationally, several jurisdictions have adopted or announced legislation to address labour and human rights abuses and violations in global supply chains. These include France, Australia, the United Kingdom, Germany, Norway, the Netherlands, New Zealand, and the European Union (EU).

• Canada, the U.S., and Mexico are the only countries with an import ban on goods produced with forced labour currently in force. Canada is the only country that has both federal supply chain legislation and an import ban on goods produced with forced labour currently in place. (The U.S. state of California has supply chain legislation and is also subject to the United States’ national import ban on goods produced with forced labour. However, the U.S. does not have federal supply chain legislation).

• The European Union is in the process of developing a ban; on April 23, 2024, the EU Parliament approved a regulation prohibiting products made with forced labour from its market and is pending final formal approval by the EU Council. Once approved and published in the Official Journal, EU countries will have 3 years to start applying it.

• Canada continues to work closely with the U.S., Mexico and other international partners on labour exploitation issues.

• Domestically, the government has committed to introducing supply chain legislation as reflected in the December 2021 mandate letter commitment of the Minister of Labour and Seniors, together with the Minister of Public Safety, Democratic Institutions and Intergovernmental Affairs, the Minister of Public Services and Procurement and the Minister of Export Promotion, International Trade, and Economic Development.

• Budget 2023 announced the federal government's intention to introduce legislation in 2024 to help eradicate forced labour from Canadian supply chains. Budget 2023 also announced that the government would strengthen the import ban on goods produced using forced labour. These commitments were reconfirmed in Budget 2024.

• Supply chain legislation will complement other ongoing initiatives across the federal government that are aimed at reducing exploitation in supply chains, such as:

o the inclusion of comprehensive and enforceable provisions on forced labour and child labour in Canada’s free trade agreements;
o the delivery of technical assistance to developing trade partner countries to promote compliance with internationally recognized labour standards;
o strengthening the Customs Tariff import prohibition on goods produced by forced labour as was announced in the federal budget;
o a federal procurement contracting regime that establishes expectations for suppliers and sub-contractors on upholding human rights; and
o Global Affairs Canada’s latest Responsible Business Conduct Strategy, launched in April 2022.

• Import bans are distinct from supply chain legislation but should be viewed as complementary. Supply chain legislation is a proactive measure to improve working conditions in developing countries. It requires companies to look into their supply chains, identify risks and/or instances of forced labour, and take action in their business processes to prevent and address risks/violations. This in turn, helps reduce the risk of running afoul of import prohibitions, which may block market access of goods determined to be made using forced labour.

Forced labour import prohibition
• Canada is still in a relatively early stage in the operationalisation of the forced labour import prohibition enforcement regime, being only the second country in the world to have put a ban of this nature in place. The U.S has had a forced labour ban in place for 90 years. Mexico’s ban came into force in May 2023.

• The Canada Border Services Agency (CBSA) is responsible for the enforcement of the import prohibition. Work is currently being undertaken to consider means of strengthening the ban, as was committed to in past Federal Budgets.

• Under the current import prohibition, CBSA uses research and analysis from ESDC-Labour and other sources of information to identify goods entering Canada that are suspected to have been produced by forced labour. Establishing that goods have been produced by forced labour requires significant research and analysis and supporting information. The risk analysis to establish the likelihood that a specific shipment contains goods produced with forced labour is made on a case-by-case basis, based on available information and analysis.
Consultations
• In addition to past engagements on labour exploitation in global supply chains (including roundtables held in 2019 and input received in 2022 following the release of the What We Heard Report), the Labour Program, CBSA and other relevant departments hosted a roundtable in the fall of 2023 to discuss technical elements of due diligence supply chain legislation and strengthening the import prohibition. Feedback from this and other stakeholder activity are valued inputs to inform ongoing work on the mandate and Budget commitments to address exploitation in Canada’s global supply chains.
Parliamentary Context
• There have been a range of senate public and private members bills introduced on these issues including former Senate Public Bill S-211 (Fighting Against Forced Labour and Child Labour in Supply Chains Act), C-262 (“Corporate Responsibility to Protect Human Rights Act”) and C-263 (“Responsible Business Conduct Abroad Act”).

• The Bills are at varying stages of the legislative process:

o Bill S-211, which was introduced by Senator Julie Miville-Dechêne, and sponsored by M.P. J. McKay in the House of Commons, received Royal Assent on May 11, 2023, and came into force on January 1, 2024. It includes a transparency, or ‘reporting’-based regime on risks of forced labour and child labour in supply chains, in addition to expanding the import prohibition on goods produced with forced labour, to also ban goods produced with child labour, more broadly, as defined by the Act.

o The Fall Economic Statement announced $8M in funding for Public Safety over three years to support implementation of the Act.

o Bills C-262 and C-263, which were introduced by New Democratic Party MPs Peter Julian and Heather McPherson respectively, both completed first reading in the House on March 29, 2022. Bill C-262 proposes a broader human rights supply chain due diligence regime, and Bill C-263 proposes the appointment of a Commissioner for Responsible Business Conduct Abroad to ensure entities comply with due diligence reporting obligations.

Recent Media Coverage
• There has been a wide range of media coverage in recent months and years regarding forced labour and exploitation in global supply chains domestically and globally. Domestically, many stakeholders have called for strong supply chain legislation, and some have critiqued former Bill S-211. Several articles brought attention to exploitation in various sectors, such as Canadian seafood supply chains.

• In addition, there has been significant media attention on the import ban, including comparisons with the US regime and its enforcement activity, particularly with respect to its presumptive approach regarding goods from Xinjiang, and concerns about shipments being blocked from the US and re-routed to other countries. This included, for example, a June 5 article published by the CBC describing US concerns with forced labour goods being re-routed to Canada after being blocked by the US. A US senator met with Canadian MPs suggesting that an alert list be shared amongst CUSMA countries, which could allow all of them to automatically block shipments one country deems made with forced labour. The article also cited Canadian MP John McKay as indicating that Canada’s lack of enforcement could become an irritant in the 2026 review of CUSMA.

• On September 11, 2024, the Globe and Mail reported that the Human Rights Action Group and the Uyghur Rights Advocacy Project (URAP) are petitioning the federal government to impose sanctions on eight Chinese companies over alleged rights violations, including forced labour and abuse of deckhands committed on board Chinese squid fishing vessels. URAP said “Canada is a dumping ground” for forced-labour products, in contrast to the U.S. The article also indicated that according to the Canada Border Services Agency “not a single shipment of goods made with forced labour has been blocked.”

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