1. Introduction
1.1 Business and Human Rights: A Summary
Canada's approach to business and human rights involves a mixture of law and policy and is very much grounded in – and influenced by – international treaties and standards, as well as the evolving expectations of stakeholders, including the communities in which Canadian businesses operate, investors, NGOs and civil society more broadly.
Canada is a parliamentary democracy with a constitutional system of government that includes a division of legislative powers between federal (national), provincial and territorial governments. Each government has the power to legislate on matters that directly affect various aspects of human rights. As such, the ongoing implementation of Canada's international human rights obligations is a shared responsibility between federal, provincial and territorial governments within their respective areas of jurisdiction and decision-making powers.
Since the unanimous endorsement of the United Nations (UN) Guiding Principles on Business and Human Rights (the "UNGPs") by the UN Human Rights Council in 2011, Canadian initiatives have been guided by Canada's responsibilities under the UNGPs. These responsibilities are:
- to ensure Canadian businesses respect human rights throughout their operations; and
- to establishing dispute resolution processes to remedy business-related human rights abuses.
Historically, the Canadian government has relied primarily on voluntary directives, with its earliest policy efforts framed in the language of corporate social responsibility. Until more recently, with the coming into force of the Fighting Against Forced Labour and Child Labour in Supply Chains Act (the "Supply Chains Act"), Canada had taken limited action to codify policy expectations and requirements in legislation.
The most recent iteration of the government's responsible business conduct strategy is the "Responsible Business Conduct Abroad: Canada's Strategy for The Future" (the "2022 RBC Strategy"), a five-year strategy (2022–27) that sets out the Canadian government's expectations of Canadian companies operating globally. Pursuant to the 2022 RBC Strategy, Canada expressly recognises the importance of legislation that targets certain areas, including supply chain transparency and supply chain due diligence.
Further legislative activity in the area of business and human rights is anticipated in Canada.
2. Legal Framework
2.1 International
International human rights law, including international human rights treaties signed and ratified by states, underpin and inform the principles of business and human rights – along with the UN's Universal Declaration of Human Rights. As a member of the international community committed to the protection of human rights, Canada has ratified or signed several international human rights treaties, conventions and multilateral agreements related to human rights.
In addition to supporting the principles outlined in the UN's Universal Declaration of Human Rights, Canada has ratified the seven principal UN human rights conventions and covenants, including the International Convention on the Elimination of All Forms of Racial Discrimination and the International Covenant on Civil and Political Rights. In signing or ratifying core human rights treaties overseen by the UN, Canada is accountable to the UN and to other member states thereof when it comes to upholding and protecting human rights. In 2019, Canada became a state party to the UN Arms Trade Treaty (ATT). In 2021, Canada also implemented the UN Declaration on the Rights of Indigenous Peoples (UNDRIP).
Canada has signed and ratified nine of the ten International Labour Organization (ILO) Fundamental Conventions. Canada also adheres to international guidelines that promote business and human rights, including the UNGPs, the OECD Guidelines on Multinational Enterprises on Responsible Business Conduct (the "OECD Guidelines"), and the ILO's Tripartite Declaration of Principles Concerning Multinational Enterprises and Social Policy (the "MNE Declaration"), which sets out guidelines for businesses on labour practices (eg, safe working conditions and the elimination of forced labour).
Canada has adopted the UN's Sustainable Development Goals (SDGs), which are designed to advance corporate sustainability internationally and which include the principles of inclusive development and access to remedy. In line with these commitments, Canada continues to adopt voluntary and mandatory measures to set out expectations and legal requirements for corporate conduct globally.
2.2 National and Regional
2.2.1 National Action Plan
The Canadian government has not yet developed a national action plan (NAP) on business and human rights as contemplated and encouraged by the UN Working Group on Business and Human Rights.
In 2022, Canada introduced the 2022 RBC Strategy, a five-year strategy that contains measures to support Canadian companies in integrating leading responsible business practices and to position Canada to advance policies and practices within the international responsible business conduct ecosystem. (For further detail, see 2.2.7 Soft Law on Business and Human Rights).
2.2.2 Corporate Human Rights Due Diligence Legislation
To date, Canada has not introduced mandatory human rights due diligence legislation. However, such legislation has been under consideration at the federal level for a number of years.
The previous Canadian Parliament, led by a minority Liberal government, included among its priorities a commitment to enact broader human rights due diligence legislation by 2024 to ensure that Canadian businesses operating abroad do not contribute to human rights abuses and violations. The federal government undertook consultations on how to develop mandatory human rights due diligence legislation in October 2023.
A 2021 report by the Standing Committee on Foreign Affairs and International Development on the mandate of the Canadian Ombudsperson for Responsible Enterprise (CORE) recommended that the Canadian government introduce legislation requiring Canadian corporations to conduct human rights due diligence to identify, prevent, mitigate, and account for any potential adverse human rights, environmental and gendered impacts they may cause throughout their supply chains and operations.
A report published in September 2023 by the Standing Committee on International Trade, entitled "Canadian Mining and Mineral Exploration Firms Operating Abroad: Impact of the Natural Environment and Human Rights", recommended that the "[g]overnment of Canada, in consultation with relevant stakeholders, consider new or modified strategies, policies and other measures that would further promote and enhance [...] responsible business conduct in the foreign operations of Canadian firms". In its response to the report, the Canadian government emphasised that the government initiatives in this area are ongoing and that the government is committed to, among other things, "developing effective measures to enhance Canadian companies' due diligence".
It is not yet clear if the newly elected Liberal minority government (which, under a new Prime Minister, replaces the previous Liberal minority government) will prioritise mandatory human rights due diligence legislation as part of its mandate. However, it is anticipated that mandatory human rights legislation will continue to be discussed and promoted in the next Parliament by the government and/or through Senate and private member legislative initiatives.
2.2.3 Modern Slavery Legislation
In accordance with Canada's obligations under the Canada–United States–Mexico Agreement (CUSMA), on 1 July 2020, amendments to Canada's Customs Tariff and the Schedule to the Customs Tariff took effect. These amendments prohibit "goods mined, manufactured or produced wholly or in part" by forced or compulsory labour (regardless of country of origin) from being imported into Canada.
On 1 January 2024, the import prohibition was expanded to apply to goods mined or manufactured by child labour (regardless of country of origin), with the coming into force of the Supply Chains Act. Compliance with this import prohibition requires companies importing goods into Canada to conduct ongoing due diligence and review of their supply chains to ensure the absence of forced labour at each step of production.
This initiative forms part of the government's efforts to strengthen compliance with international human and labour rights in supply chains. It also aligns with Canada's ongoing commitments under CUSMA.
Strengthening Enforcement of Import Ban – Measures Under Consideration
In the autumn of 2024, the Canadian government undertook consultations to consider potential new measures to strengthen the enforcement of Canada's ban on the import of goods produced by forced labour, in alignment with Mexico and the USA. These consultations, as well as the public consultations held earlier in October 2023 on the eradication of forced labour from the country's supply chains through mandatory human rights due diligence and other measures, form part of the government's broader effort to strengthen compliance with international human and labour rights in supply chains.
A number of measures are currently being considered by the Canadian government to strengthen Canada's ban on imports of goods from forced labour. One such measure is the publication of a list – informed by ILO indicators and other sources – of "goods at risk of forced labour". The list would identify those goods and their origin countries with a prevalent risk of being produced by forced labour and would likely take a similar form to the US Bureau of International Labor's List of Goods Produced by Forced Labor or Child Labor.
The Canadian government is also considering amending legislation to require importers to provide evidence in order to rebut a presumption that goods from "goods at risk of forced labour" list have been manufactured using forced labour or child labour. The creation of such "reverse onus" on importers for categories of goods from specific countries would have significant implications for Canada's anti-forced labour regime, increasing the pressure on companies to engage in robust due diligence of their supply chains and expanding traceability requirements. A precedent for such a reverse onus requirement is found in the regulations currently in force in the USA under the Uyghur Forced Labor Prevention Act, which creates a reverse onus on goods sourced from the Xinjiang Uygur Autonomous Region of China.
Penalties for Non-Compliance
A wide range of civil and criminal penalties for non-compliance are available under the Customs Act, including fines, imprisonment, or both.
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Originally published by Chambers Global 2025 Practice Guide: Business & Human Rights
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