Overview of Canada's Supply Chains Act (Bill S-211)
On December 20, 2023, Public Safety Canada launched its new website providing guidance on implementing the Fighting Against Forced Labour and Child Labour in Supply Chains Act, commonly referred to as the Supply Chains Act or Bill S-211, which took effect January 1, 2024. The Act represents Canada's most significant legislative step to date in addressing modern slavery, building on its obligations under International Labour Organization conventions—specifically the ILO Worst Forms of Child Labour Convention (1999) and the Forced Labour Convention (1930), which form the definitional backbone of the legislation. The purpose of the Act is to reduce the use of forced labour and child labour in supply chains by increasing transparency. It does so by creating a public annual reporting regime that compels covered entities to disclose the concrete actions they have taken during the previous financial year to identify, prevent, and reduce risks of forced and child labour. Reports must be submitted on or before May 31 of each year to the Minister of Public Safety and Emergency Preparedness, beginning with the first deadline of May 31, 2024. The Act applies to two broad categories of obligated parties. The first includes federal government institutions—departments, ministries of state, Crown corporations, and wholly owned subsidiaries—that produce, purchase, or distribute goods in Canada or elsewhere. The second category covers private-sector entities engaged in producing, selling, or distributing goods in Canada or elsewhere, importing goods produced outside Canada, or controlling another entity engaged in those activities. The entity categories are interpreted broadly to encompass corporations, trusts, partnerships, and other unincorporated organizations that meet the Act's financial thresholds.
The Act casts a wide net, capturing both domestic and international businesses that meet size criteria and engage in goods-related activities in Canada.
An entity qualifies for reporting obligations if it has a place of business in Canada, does business in Canada, or holds assets in Canada, and based on its consolidated financial statements meets at least two of the following three conditions for at least one of its two most recently completed financial years: assets of at least $20 million, revenue of at least $40 million, or an average of at least 250 employees. Importantly, these thresholds are assessed on a consolidated basis, meaning corporate groups that collectively meet the thresholds are captured even if individual subsidiaries do not. The Act also extends its reach to international businesses. Foreign entities that have some presence in Canada, do business in Canada, or control a Canadian entity that meets the thresholds may also be subject to reporting obligations. The Ministry of Public Safety has advised that the categories of corporation, trust, partnership, and other unincorporated organizations should be interpreted broadly to extend to similar forms of business organization. Activities triggering reporting obligations are defined as all pursuits undertaken by an entity related to producing, selling, distributing, or importing goods. However, purely service-based businesses—such as those offering marketing, administrative, financial, or software services that solely support goods activities—are generally not captured. The Act does not set a minimum threshold for the volume of production, sale, or importation of goods; any qualifying level of such activity combined with meeting the financial criteria triggers the reporting obligation. Corporate groups with multiple entities subject to the Act may file a single joint report covering the group.
Reports must address seven mandatory content areas with honest, concrete descriptions of past-year actions—not aspirational future goals.
The Act requires each annual report to address specific content areas set out in subsections 11(1) and 11(3). These mandatory reporting areas include: the entity's structure, activities, and supply chains; policies and due diligence processes regarding forced labour and child labour; the parts of the business and supply chains at risk for forced or child labour and the steps taken to assess and manage that risk; steps taken to prevent and reduce the risk of forced or child labour in the production or importation of goods; any measures taken to remediate forced or child labour; any measures taken to provide income replacement to vulnerable families impacted by eliminating such labour; training provided to employees on forced and child labour; and how the entity assesses its own effectiveness at preventing these risks. Public Safety Canada's guidance emphasizes that reports should use plain language and provide honest descriptions of concrete actions taken in the past year—not aspirational goals. While future plans may be mentioned, the focus must remain on past actions. Entities need not disclose commercially sensitive information or details on specific cases that would violate privacy or create legal risks, but they should provide a comprehensive overview and not omit aspects they believe carry no risk. When describing supply chains, entities should identify source countries or regions of goods and services used at each stage as completely as possible. The Canadian government now requires that an online questionnaire be completed alongside the PDF report. Some mandatory questions gather identifying details such as the financial year covered and the sector in which the reporting entity operates, while other mandatory questions collect data required to comply with each of the Act's specific reporting mandates. Optional open-ended questions (limited to 1,500 characters) follow the mandatory closed-ended questions and allow entities to expand on responses. Although optional, entities are strongly encouraged to complete these open-ended questions, as gathering this data over time is expected to enhance the ability to identify, prevent, and address forced labour and child labour risks. The PDF report is the public-facing product published on the Public Safety Canada website and on the entity's own website, meaning all required information must appear in both the questionnaire responses and the PDF.
Non-compliance carries serious financial and personal legal consequences, underscoring the importance of robust internal compliance programs.
Entities that fail to comply with the reporting requirements under Bill S-211 face significant consequences. Any person or entity that fails to comply with its obligations, submits false or misleading information, or obstructs officials is guilty of an offence punishable on summary conviction and liable to a fine of up to $250,000. The Act also creates personal liability for directors, officers, agents, or mandataries who directed, authorized, assented to, acquiesced in, or participated in an offence—they may be individually convicted and fined up to $250,000 regardless of whether the entity itself has been prosecuted or convicted. The Minister of Public Safety is empowered to designate a person to enter a business without a warrant to verify compliance, including examining documents, data, and materials. The Minister will also prepare an annual public report containing the particulars of any charges laid against a person or entity under the Act, published on the Public Safety Canada website. Public Safety Canada will additionally maintain a searchable electronic registry of all submitted reports, making them publicly accessible. Entities are separately required to place their submitted statements prominently on their own websites. Beyond legal penalties, compliance with the Act aligns with the social and governance dimensions of ESG frameworks. Organizations that actively address forced and child labour risks demonstrate commitment to ethical supply chains and corporate accountability, which can improve stakeholder trust, brand reputation, and access to investment. The legislation encourages businesses to accelerate their ESG strategies by performing due diligence across all tiers of their supply chains—from direct suppliers through to raw material sourcing—ensuring practices align with both legal standards and broader ethical values.
*not sales material disguised as 'resources.'