As 2026 brings new compliance challenges and opportunities, Baker McKenzie’s Canadian international trade team is here to help you stay ahead. We are launching our annual series of insights that unpack 2025’s biggest developments and spotlight the trade issues set to define 2026, bringing the clarity needed to navigate the evolving trade landscape.
This article focuses on Canada’s regulation of forced labour and child labour.
It remains unclear whether the Government of Canada’s 2024 ambitions under the leadership of Prime Minister Trudeau – to establish supply chain due diligence legislation, ramp up enforcement of the import prohibition, and provide legislative authority for a rebuttable presumption on goods being manufactured with forced or child labour – remain a priority for Prime Minister Carney’s administration. Throughout 2025, the CBSA’s guidance on Canada’s import prohibition remained under review, the Canadian Ombudsperson for Responsible Enterprise (CORE) appears to remain stalled, there were no more publicly reported detentions of goods by the CBSA, and Public Safety Canada continues to prioritize educating corporations on their supply chain transparency obligations and not enforcement. Canada is heading into a review of the USMCA/CUSMA in July 2026, and forced labour and child labour concerns are likely to be on the agenda. Marco Rubio, now Secretary of State, was largely responsible for the US legislative initiatives on implementing the rebuttal presumption under the Uyghur Forced Labour Prevention Act (UFLPA) while he was a member of Congress and has since underlined the limitations in Canada’s approach to forced labour to date. While the Government of Canada has yet to act, a private members bill continues through the legislative process seeking to establish a rebuttable presumption and restrict the import of goods mined or manufactured for with forced/child labour into Canada.
Canadian businesses can prepare for advancements in supply chain regulation as follows:
- Take advantage of filing consolidated global reports in jurisdictions where supply chain reporting requirements are in force. Public Safety Canada has released a template for coordinated reporting in the UK, Australia and Canada.
- Be mindful of the interplay between other areas of law, such as international sanctions, with human rights. We expect that Canada will continue to impose sanctions on nationals of countries facing allegations of human rights abuses, like forced and child labour.
- Follow the development of Bill C-251 through Parliament and elected officials’ statements regarding the introduction of proposed positive due diligence legislation, or perhaps the introduction of regulations under existing legislation.
- Undertake a mock audit of customs documentation to assess whether a business is prepared to respond to a Notice of Detention on the basis that goods are mined or manufactured with forced or child labour.
- Prepare for the possibility of re-export prohibitions on goods held to be mined/manufactured with forced or child labour among Canada, the US and Mexico.
Supply chain reporting
The next reporting period under Canada’s supply chain transparency legislation, the Supply Chains Act, is now open. Reports are due to be filed with Public Safety Canada on May 31, 2026. New guidance was issued in December 2025 by Public Safety Canada that addressed filing multinational reports, including the release of a template to facilitate reporting in Canada, the UK and Australia. While use of the template remains optional, it is designed to reduce the administrative burden for entities reporting in these three jurisdictions ensuring that one report meets the seven common reporting requirements. Reporting entities planning reports for the 2026 reporting period should review the template and consider the opportunities for efficiency in multi-jurisdictional reporting.
The reports from the second filing year are available on this portal and Public Safety Canada’s second report to Parliament on the initial filing year under the Supply Chains Act is available here. The 2025 reporting year’s statistics provide a transparent benchmark for assessing best practices in Canada on employee training and assessing effectiveness. Notably, 91% of reporting entities were not aware of forced or child labour in their supply chain, despite the position of Public Safety Canada being no sectors or industries involving the production or importation of goods are assumed to be entirely free of forced or child labour risks. Of the entities uncovering forced or child labour in their supply chain only 1 provided formal apologies to victims. The majority of reporting entities relied on preventative measures. Public Safety Canada prioritized raising awareness of the reporting requirements and did not charge any entities for failing to comply under the legislation’s enforcement authority.
In 2026, we expect more reporting entities to file “global” supply chain reports, taking advantage of the new template provided by Public Safety Canada. However, reporting entities should also be mindful that the programs and policies described in a “global” report also apply to the reporting entity under the Supply Chains Act, or alternatively the “global” report should make clear what programmes/policies apply to the Canadian reporting entity/ies. We also expect that Public Safety Canada will continue to focus on raising awareness of the reporting requirements and declining to pursue enforcement under the Supply Chains Act for compliance failures. In 2025, no enforcement actions were taken and we expect the same in 2026.
Canada’s import prohibition on goods mined/manufactured with forced or child labour
Since July 1, 2020, Canada has prohibited the importation of goods mined or manufactured by forced labour under the Customs Tariff. The import prohibition was expanded to apply to goods mined or manufactured by child labour with the coming into force 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 on January 1, 2024. Draft revisions to the Canada Border Services Agency (“CBSA“) policy on the import prohibition were circulated in Fall 2023; however, the current CBSA policy has yet to be updated and remains under review.
The CBSA last publicly addressed its enforcement process regarding the import prohibition on goods mined, manufactured or produced wholly or in part by forced or child labour in Fall 2023. For more details on the CBSA’s comments to industry concerning its forced and child labour import prohibition plans, read Baker McKenzie’s client alert here.
Although some imports have been detained and investigated by the CBSA on the suspicion of forced or child labour, the CBSA has not released statistics regarding its enforcement of this import prohibition. In a briefing note prepared for the Minister of International Trade to appear before the Standing Committee on International Trade (CIIT) speaking on Canada-US trade, the following statistics were included: the CBSA has detained 50 shipments over forced labour concerns since 2021; however, only one has been determined to be produced by forced labour and was prohibited entry into Canada.
Canada has drawn scrutiny regarding its scant enforcement of the import prohibition from US Members of Congress, whom have not only urged cooperation under the forced labour provisions of the USMCA, but suggested that forced labour be discussed during the USMCA joint review scheduled for July 2026.
The comments from US Members of Congress focus on the reported diversion of goods denied entry into the US being imported into Canada followed by an attempt to re-export the same goods into the US, and the lack of a rebuttable presumption under Canadian and Mexican law to establish a burden of proof on importers to prove that their supply chains are free of forced/child labour. While the Government of Canada had at one point promised the introduction of a rebuttable presumption, it has not taken action to amend the law. Instead, a private members bill continues through the legislative process seeking to introduce a rebuttable presumption (more below). We expect that the US will seek to amend the text of Article 23.6 of the USMCA to incorporate a rebuttable presumption, or perhaps seek, as it has in other recently negotiated trade agreements to presumptively prohibit importation of goods from entities listed under the UFLPA Entity List or where a finding has been made under section 307 of the Tariff Act of 1930, the core global forced labour prohibition under US law.
Bill C-251 An Act to amend the Customs Act and the Customs Tariff (forced labour and child labour)
Public interest groups previous attempts to establish a presumptive determination – that goods imported from certain geographies were made with forced labour and therefore prohibited from importation into Canada – were stymied by a lack of authority under the Customs Act allowing the CBSA to impose a presumptive determination.
However, now a private members bill introduced by the Bloc Québécois, Bill C-251, proposes substantial amendments to the Customs Act and Customs Tariff to create a rebuttable presumption that imported goods from certain countries or entities are made with forced or child labour, unless an importer can furnish evidence that proves otherwise. This bill would grant the CBSA authority to designate countries and entities as presumptive forced labour status, similar to the United States’ UFLPA, and require mandatory detention of goods until an importer proves otherwise. The bill has undergone its first reading in the House of Commons and remains in the early stages of Parliament’s legislative process.
CIIT review
In early 2023, the CIIT initiated a formal study under Standing Order 108(2) to examine Canada’s prohibition on importing goods made wholly or in part with forced labour. The study also included developing a broader strategy to prevent the entry of goods mined, manufactured, or produced with forced labour. While the CIIT’s proceedings may reflect what was once a strong push to close enforcement gaps in Canada’s forced labour import prohibition and expand legislative tools, it remains unclear whether the current administration is focused on forced labour risks. The CIIT report recounts the 2023 and 2024 commitments to eliminate forced labour from Canadian supply chains, and to strengthen the ban on imports produced with forced labour and underlines the inaction by the Government to date. Given the changes proposed under Bill C-251, we expect that the CIIT will review Canada’s forced/child labour regime again in 2026.
Continued operation of the CORE remains uncertain
The Canadian Ombudsperson for Responsible Enterprise (CORE) once had an ambitious agenda to review complaints issued against Canadian companies operating in the garment, mining and oil and gas sectors. Its status and effectiveness as a body overseeing the activities of Canadian corporations abroad remains uncertain.
The Ombudsperson position has been vacant for much of late 2025 and into 2026. The first Ombudperson’s term ended in 2024, and an interim head’s term ended in May 2025. No permanent successor has been appointed and while the CORE continues to be funded through Global Affairs Canada’s budget, the Government’s 2025 Budget did not propose any additional funding for CORE, nor any commitments to expand CORE’s powers to include subpoena-like enforcement powers or expand its sectoral mandate.
Throughout 2024, the CORE resolved a number of complaints against Canadian companies, issuing final reports. One such report was subject to judicial review before the Federal Court, challenging the closure of a complaint alleging failure to pay foreign garment workers a living wage. The judicial review was dismissed on the grounds that there is no right of review given that the CORE’s conclusions are advisory, and do not impact legal rights, impose legal obligations or cause prejudicial effects. In October 2025, a Member of Parliament asked questions in the House of Commons regarding the absence of an Ombudsperson, when one would be appointed, whether the office would continue to be funded, and whether the Government would equip the CORE with subpoena powers. The Government did not commit to specific appointments or new powers.
