Question Period Note: Supermax Forced Labour Allegations

In response to the COVID-19 pandemic, Public Services and Procurement Canada (PSPC) put in place 32 contracts with 13 suppliers for nitrile gloves beginning in March 2020. Globally, the majority of nitrile gloves are manufactured in Malaysia, a country where there have been noted instances of forced labour. In December 2020, it was brought to PSPC’s attention that there was a possible forced labour issue with suppliers in Malaysia and actions were taken to remind suppliers of their obligations. In October 2021, PSPC received information of allegations indicating the use of forced labour in Supermax Healthcare Canada’s manufacturing operations in Malaysia. Following discussions, Canada and Supermax Healthcare Canada mutually agreed in December 2021 to terminate two contracts for nitrile gloves manufactured in Malaysia.

Note: All questions regarding the import prohibition of goods that are mined, manufactured or produced by forced labour should be directed to the Minister of Public Safety, as the Minister responsible for the Canada Border Services Agency (CBSA)

• The Government is committed to protecting Canadians from COVID-19
  • The Government of Canada is also committed to addressing the risk of forced labour and human trafficking in federal procurement supply chains through the National Strategy to Combat Human Trafficking
  • When the Government was made aware of allegations of forced labour practices against a supplier, Supermax Corp. of Malaysia, Public Service and Procurement Canada took action and ultimately terminated two Supermax Healthcare Canada contracts
  • Public Services and Procurement Canada no longer has any active glove contracts. For future requirements, PSPC will focus on leveraging domestic contracts and award new contracts to suppliers with proven records of addressing labour exploitation if contracts are awarded to companies operating in countries where forced labour has been identified
  • Public Service and Procurement Canada continues to leverage domestic supply chains wherever possible, with more than 40% of the total value of PPE contracts going to domestic companies

Since April 2020, Supermax Healthcare Canada was awarded contracts for the supply of nitrile gloves. Before being terminated there were two active contracts providing for the delivery of 113 million pairs of gloves by March 2022.

In December 2020, it was brought to PSPC’s attention that there was a possible forced labour issue with suppliers in Malaysia. PSPC reminded its glove suppliers of their obligations in regards to ethical practices and human rights. In January 2021, PSPC received attestation from Supermax Healthcare Canada confirming their commitment to ethical working conditions.

On October 21, 2021, PSPC learned that United States Customs and Border Protection issued an order that prohibits imports from Supermax Malaysia based on reasonable information that indicates the use of forced labour in the company's manufacturing operations in Malaysia.

In light of the allegation, PSPC asked Supermax Healthcare Canada to suspend all future deliveries until Canada was satisfied that its contracted gloves were produced without forced labor.

On December 16, 2021, Supermax Healthcare Canada provided Canada a summary response to the findings of the first of a series of four audit reports. This audit was conducted at the Malaysian sites by an independent firm. Canada reviewed the report and did not believe it had sufficient information to fully assess the matter. Rather than waiting for the full audit report, which was due in April 2022, on December 22, 2021, Canada and Supermax Healthcare Canada mutually agreed to proceed with a termination of contracts.

On January 24, 2022, the Government of Canada and Supermax Healthcare Canada terminated two existing contracts for the delivery of nitrile gloves by mutual agreement.

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