Canada: Canada's Action To Eliminate Forced Labour And Child Labour

INTRODUCTION

In furtherance of Canada's commitment to eliminate forced labour and child labour, the Fighting Against Forced Labour and Child Labour in Supply Chains Act (Canada) (the "Act") received Royal Assent on May 11, 2023.¹ The Act imposes reporting obligations on government institutions, entities and entities controlling entities that produce, purchase, or distribute goods in Canada or elsewhere, or entities and entities controlling entities that import goods produced outside of Canada.

Further, the Act amends the Customs Tariff (Canada) (the "Tariff") to include a prohibition on importing goods produced by child labour and authorizes the Governor in Council to make further regulations regarding goods produced by child labour or forced labour. The Act will come into force on January 1, 2024. Importers should take these new legislative provisions into account when developing and reviewing supply chain and import compliance programs.

BACKGROUND

Canada has participated in several international efforts to prohibit forced labour or child labour, including ratifying international conventions such as the Forced Labour Convention, 1930.² Additionally, Canada adopted the ILO Declaration on Fundamental Principles and Rights at Work and its Follow-up (the "ILO Declaration").³ Canada, the United States and Mexico entered a trade agreement that contained a provision relating to the adoption of regulations and practices in accordance with the ILO Declaration to eliminate all forms of forced or compulsory labour.⁴ In response, Canada amended the Tariff to prohibit goods mined, manufactured or produced wholly or in part by forced labour under tariff item no. 9897.00.00 that came into effect in July 2020.⁵

Canadian organizations have also contributed to the fight against forced labour or child labour. In 2018, a report regarding the elimination of child labour in supply chains by the Standing Committee on Foreign Affairs and International Development contained recommendations for Canada to enhance its support for businesses to ensure compliance with eliminating child labour in supply chains.⁶ Canada enacted several bills to implement the recommendations, however Bill S-211, an Act to enact the Fighting Against Forced Labour and Child Labour in Supply Chains Act, was the only bill to receive Royal Assent.⁷ Further, in 2022, Employment and Social Development Canada (the "ESDC") produced a report summarizing the 2019 consultations that suggested the Government of Canada needs to take further action to address the issue of labour exploitation in global supply chains.⁸ Other initiatives by the Canadian government include the Canadian Ombudsperson for Responsible Enterprise ("CORE"), which investigates allegations of human rights complaints.⁹ Moreover, in 2022, Canada introduced the Responsible Business Conduct Abroad Strategy, which contains measures for prevention, mitigation and legislation to promote responsible business activities, including the elimination of forced labour.¹⁰

REPORTING OBLIGATIONS PURSUANT TO THE ACT

Pursuant to the Act, annual reports to the Minister of Public Safety and Emergency Preparedness (the "Minister") must be completed on or before May 31 of each year for the previous financial year. The reports must be made accessible to the public and include the steps taken by government institutions and entities to prevent and reduce the risk that forced labour or child labour is used during the production of goods in Canada or by importation of goods into Canada.¹¹

It is an offence to fail to comply with the report or the accessibility requirement, and will lead to a fine of not more than $250,000.¹² Further, if any person or entity provides false or misleading statements, they will be guilty of an offence and liable for a fine of not more than $250,000.¹³ The Minister will provide an annual report to Parliament that summarizes the reports, which will be published on the Department of Public Safety and Emergency Preparedness website.¹⁴

CURRENT CUSTOMS TARIFF AND AMENDMENTS PURSUANT TO THE ACT

In 2021, the Canada Border Services Agency (the "CBSA") issued Memorandum D9-1-6 ("Memo D9-1-6") to provide guidelines and information about tariff item No. 9897.00.00, regarding the prohibition of goods manufactured or produced by forced or prison labour. The guidelines outlined the Labour Program of ESDC's role in researching and developing reports that highlight problematic supply chains regarding forced or prison labour.¹⁵ CBSA may use these reports to identify and detain the suspected prohibited goods.¹⁶ However, these reports are not available to the public.

On March 11, 2021, an Issue Note by the Special Committee on Canada-China Relations was released that indicated that CBSA had not yet applied the Tariff prohibition on goods manufactured or produced by forced or prison labour.¹⁷ However, news reports indicated that CBSA seized a shipment of suspected goods manufactured or produced by forced or prison labour in late 2021.¹⁸ No details have been released by CBSA.

Pursuant to the Act, the Tariff will be expanded to include "child labour," in addition to the current provisions regarding forced labour and prison labour.

RELATED FORCED LABOUR CONCERNS

In Kilgour v Canada (Attorney General), 2022 FC 472, Kilgour (the "Applicants") sought judicial review by the Federal Court of a CBSA email. The Applicants requested that CBSA implement a presumptive prohibition of the importation of goods from the Xinjiang region of China, under Tariff item No. 9897.00.00, goods mined, manufactured, or produced wholly or in part by forced labour, because goods are likely to be produced using forced labour. The CBSA responded by email stating their lack of authority to implement the prohibition. The Court agreed with CBSA's interpretation of their jurisdiction and dismissed the application.¹⁹

A news release on July 11, 2023, announced that CORE launched investigations into the supply chain and operations of Nike Canada Corporation and Dynasty Gold Corporation in response to allegations of Uyghur forced labour.²⁰ Further details are to be released.

The authors would like to thank Vanessa Rosteski, 2023 Miller Thomson Summer Law Student, for her contributions to this article.

Footnotes

1. Fighting Against Forced Labour and Child Labour in Supply Chains Act, SC 2023, c. 9 [Act].

2. Canada, Parliament, Legislative Summary of 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, 44th Parl, 1st Sess, Publication No. 44-1-S211-E (20 May 2022) (Robert Mason) [Legislative Summary].

3. International Labour Organization, ILO Declaration on Fundamental Principles and Rights at Work and its Follow-up, 1998.

4. Canada-United States-Mexico Agreement as amended by Protocol of Amendment to the Agreement between Canada, the United States of America, and the United Mexican States, 10 December 2019, CAN TS 2020 No 6 [CUSMA].

5. Canada, Canada Border Services Agency, Import Prohibition on Goods Produced by Forced Labour (Ottawa: Commercial Trade Branch, 2021) (https://www.publicsafety.gc.ca/cnt/trnsprnc/brfng-mtrls/prlmntry-bndrs/20210625/10-en.aspx)

6. Canada, Parliament, House of Commons, Standing Committee on Foreign Affairs and International Development, A Call to Action: Ending the Use of Child Labour in Supply Chains, 42nd Parl, 1st Sess, No. 19 (October 2018) (Chair: Michael Levitt).

7. Bill S-211, An Act to Enact the Fighting Against Forced Labour and Child Labour in Supply Chains Act, 1st Sess, 44th Parl, 2021 (assented to 11, May 2023) SC 2023, c. 9.

8. Canada, Employment and Social Development Canada, Labour Exploitation in Global Supply Chain: What We Heard Report (Ottawa: Employment and Social Development Canada, 2022).

9. Canada, Department of Foreign Affairs and Trade Development, About the CORE: Mandate of the Canadian Ombudsperson for Responsible Enterprise (https://core-ombuds.canada.ca/core_ombuds-ocre_ombuds/about-a_propos.aspx?lang=eng).

10. Canada, Ministry of Small Business, Export Promotion and International Trade of Canada, Responsible Business Conduct Abroad (Ottawa: Ministry of Small Business, Export Promotion and International Trade of Canada, 2022).

11. Act, supra note 1.

12. Act, supra note 1.

13. Act, supra note 1.

14. Act, supra note 1.

15. Canada, Canada Border Services Agency, Canada Border Services Agency's Policy on the Classification of Obscene Material: Memorandum D9-1-1 (Ottawa: Canada Border Services Agency, 2017) [Memorandum D9-1-1].

16. Ibid.

17. Canada, Canada Border Services Agency, Issue Notes- Special Committee on Canada-China Relations: National Security Dimension of the Canada-China Relationship (March 11, 2021) (https://www.cbsa-asfc.gc.ca/transparency-transparence/pd-dp/bbp-rpp/cacn/2021-03-11/issues-enjeux-eng.html)

18. Singh, A., & Pedersen, K., et al., "Canadian brands sold clothing from factory suspected of secretly using North Korean forced labour", CBC News (6 November 2021), online: (https://www.cbc.ca/news/canada/marketplace-canadian-brands-forced-labour-1.6236820)

19. Kilgour v Canada (Attorney General), 2022 FC 472.

20. Canada, Canadian Ombudsperson for Responsible Enterprise, The CORE Launches Investigations into Two Canadian Companies (Ottawa: July 11, 2023) (https://core-ombuds.canada.ca/core_ombuds-ocre_ombuds/news-nouvelles/press-release-communique-2023-07-11.aspx?lang=eng)

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