Joining the ranks of the U.S. and Germany, Canada passed its own forced labor legislation which went into effect in January 2024. Now an upcoming deadline for the bill will require Canadian businesses to complete reporting requirements on their efforts to prevent forced labor by May 31.
With this first deadline fast approaching, here’s what you need to know about the new legislation:
What does the bill state?
After years of stalled efforts, the Canadian Parliament 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 in May of 2023. The act took effect on January 1, 2024 and imposed significant reporting obligations on Canadian businesses and importers.
Businesses that meet certain thresholds will be required to file detailed public reports on measures they have taken to identify, address, and prevent forced labor, prison labor, and child labor in their supply chains. The first report will be required to be filed on or before May 31, 2024. These reports will need to be filed annually with the Minister of Public Safety and Emergency Preparedness on or before May 31, 2024.
Reporting obligations will apply to any private-sector entity that is:
- Producing, selling, or distributing goods in Canada or elsewhere
- Importing goods produced outside Canada into the country
- Controlling an entity engaged in either of the above activities
The entities above are defined as a corporation or a trust, partnership or other unincorporated organization that:
- Is listed on a stock exchange in Canada
- Has a place of business in Canada, does business in Canada or has assets in Canada
- Has met at least two of the following three conditions in at least one of its last two financial years:
- Had at least C$20 million in assets
- Generated at least C$40 million in revenue
- Employed an average of at least 250 employees
How can Canadian companies prepare?
If Canadian businesses haven’t started preparing for the May 31 deadline, it’s not too late. The reports businesses will need to file must detail the steps taken during the previous financial year to prevent and reduce the risk that forced labor or child labor is present in their supply chains.
To ease the process of the report creation, companies can take the following steps:
- Conduct a complete risk assessment of its supply chain
- Gain an understanding of the parts of its supply chain that may carry a risk of forced labor
- Review or develop policies and practices related to the prevention forced or child labor
- Develop training and education for employees on forced and child labor
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With an automated supply chain mapping and risk identification platform, such as Sayari Map, compliance teams can leverage comprehensive corporate and trade data for complete confidence in the credibility of their supply chain intelligence. Sayari empowers teams to screen thousands of suppliers at a time, quickly identifying and adjudicating potential forced labor risk deep within their supply chains.
The platform’s continuously updated public records will ensure that you’re always working with the most current information on ownership. For example, U.S. Customs and Border Protection also relies on Sayari data to investigate UFLPA violations, a similar law to Bill S-211.
As you prepare to file your annual report, watch one of our in-house analysts perform an example investigation and learn how to mitigate the risk of forced labor in global supply chains.
