Prepare a report – Entities

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The Government of Canada will continue to strengthen the reporting guidance. The reporting process and questionnaire may be subject to change in the coming years. Additional guidance will be developed and made available to support government institutions.

Process overview

Once an entity has determined that it is required to submit a report under the Act, it must complete the following steps of the reporting process ahead of the May 31 deadline:

1. Prepare a report

Reporting entities must develop a report that meets all of the requirements of the Act. Entities are expected to consult internally and gather the information needed to complete their report. Refer to the guidance for more information.

2. Approval and attestation

Once a report is complete, the report must receive approval from the appropriate governing body or bodies who have the legal authority to bind the entity or entities. The signed attestation must be included in the final PDF version of the report submitted.

3. Complete online questionnaire

Once the report is attested, entities must complete the online questionnaire. The questionnaire includes a series of open and closed-ended questions that address each of the requirements under the Act.

Entities must ensure that the information provided in the questionnaire is consistent with the information provided in their report.

If an entity is unable to complete the online questionnaire and needs to submit their answers directly via email, contact: SupplyChainsActInquiries-LoiChainesApprovisionnementEnquetes@ps-sp.gc.ca.

4. Upload completed report

At the end of the questionnaire, entities must upload their attested report in PDF format before they select “submit.” Once entities have completed and submitted the questionnaire, including the report in PDF format, a confirmation message acknowledging their submission will appear.

5. Publish report to entity’s website

Entities must publish their submitted report on a prominent place on their website. A copy of the report uploaded through the questionnaire will also be made publicly available by Public Safety Canada in a searchable online catalogue.

Report requirements

A report must meet all of the following requirements, in order to fully comply with the Act:

The questionnaire may be used as a report template or guide for developing reports. The questionnaire is designed to collect information necessary to satisfy the requirements under of the Act. More information and supplementary content (e.g. charts, graphs) may be included in the entity’s uploaded report at their discretion.

Completing the online questionnaire is mandatory. Further details on report preparation and contents are available in the guidance

Mandatory information

Once the Act comes into force, entities must, on or before May 31 of each year, submit a report to the Minister of Public Safety on:

Questionnaire

Mandatory and optional questions

The questionnaire includes mandatory and optional questions. Some mandatory questions collect identifying information about the entity, such as the financial year for which the report was completed and the sector in which the reporting entity operates. Other mandatory questions collect information needed to comply with each of the Act’s reporting requirements. These are followed by optional open-ended questions (1500-character limit) that allow entities to elaborate on their responses to the mandatory closed-ended questions and to provide additional information, if desired.

Entities are strongly encouraged to fill out the optional open-ended questions in the questionnaire. Collecting this information over time is expected to improve entities’ capacity to identify, prevent, reduce and address forced labour and child labour risks. By providing this information, entities can demonstrate leadership and responsibility and provide the level of transparency that partners, investors and members of the public are looking for. While it is not required, entities can use the exact same information and structure provided through the questionnaire to prepare their report.

Guidance for entities

Guidance on preparing a report

Official language requirements

Entities must complete the questionnaire and submit their report in one of the two Canadian official languages. It is recommended, however, that reports be submitted in both English and French, in order to make reports accessible to the broader Canadian public. Requests for translated copies of reports may be directed to the responsible entity.

Approval and attestation

In the case of a report submitted for a single entity, the report must be approved by the entity’s governing body.

In the case of a joint report, the report must be approved by either the governing body of each entity included in the report, or by the governing body of the entity, if any, that controls each entity included in the report.

The approved report must receive attestation through the following means:

The signed attestation must be included in the PDF version of an entity’s report. The questionnaire requires entities to confirm that their report: has received the required approvals; and, includes a signed attestation.

The attestation included in the PDF report should use the following format:

“In accordance with the requirements of the Act, and in particular section 11 thereof, I attest that I have reviewed the information contained in the report for the entity or entities listed above. Based on my knowledge, and having exercised reasonable diligence, I attest that the information in the report is true, accurate and complete in all material respects for the purposes of the Act, for the reporting year listed above.”

Reporting in multiple jurisdictions

The Government of Canada recognizes that many entities operating internationally are subject to reporting requirements under supply chain legislation in multiple jurisdictions, such as the United Kingdom’s Modern Slavery Act 2015 and Australia’s Modern Slavery Act 2018. The reporting requirements overlap in some cases and diverge in others.

If the information submitted in a report produced for other jurisdictions is also relevant to the Canadian Act, entities may submit the same information as a part of their report. However, it is the entity’s responsibility to ensure that the report submitted to the Minister of Public Safety meets all of the mandatory criteria of the Canadian Act as outlined in the report requirements.

For the purpose of transparency, entities should indicate in their report whether they also report under legislation in other jurisdictions.

Submitting a joint report

An entity may choose to submit a joint report covering its own actions and those of any entities it controls (i.e., its subsidiaries), or that covers multiple entities belonging to the same corporate group. Joint reports must clearly identify the legal name of each entity covered by the report.

A joint report should only be submitted if the information provided generally applies to all entities covered by the report. Wherever possible, the report should also specify which information applies to which of the entities covered by the report. For example, a parent company reporting on behalf of itself and its subsidiaries could describe a forced labour and child labour strategy that applies to the group as a whole, as well as the specific measures taken by individual subsidiaries.

A joint report should not be submitted in cases where entities have risk profiles or policies or have taken actions that diverge significantly and in a way that would make it difficult to prepare a report accurately describing all entities. For example, a parent company that has implemented comprehensive forced labour and child labour policies that apply to its own operations, but not those of its subsidiaries, should not submit a joint report suggesting that its subsidiaries also have such policies in place. In cases where the information applicable to each entity differs significantly, each entity is encouraged to submit its own report and to complete the online questionnaire separately.

Submitting a revised report

An entity may provide a revised version of the report at any time within one year of the applicable reporting deadline. Submitting a revised report allows entities to make the necessary changes to their report should it be found to not meet the minimum requirements of the Act. It also allows entities to supplement or update the information provided should the entity’s situation change or should any new information become available.

To submit a revised report, entities must complete the online questionnaire a second time, indicating the date of revision and including a description of the changes made to the original report. The revised report must be reapproved by the appropriate governing body and must be published in a prominent place on the entity’s website. Note that the previous version of the questionnaire responses will be deleted and cannot be recovered.

Publishing a report on the entity’s website

All entities are required to publish their report in a prominent place on their website. Entities may use their discretion in determining the appropriate place to include the report, but it must be visible and readily accessible to members of the public. Entities that do not have a website may be required to provide a copy of the report to any member of the public who requests it in writing.

Providing a report to shareholders

The Act requires entities incorporated under the Canada Business Corporations Act or any other Act of Parliament to provide the report or revised report to each shareholder, along with its annual financial statements.

Financial reporting year 

All reports must reference the activities undertaken during the entity’s previous financial year. A report should cover the activities of the financial year that ends no later than the reporting deadline. For example, if an entity’s financial year follows the calendar year, then a report due on May 31, 2024 would cover the activities from January 1, 2023 to December 31, 2023.

Guidance on the application of the Act

To be required to submit a report, a corporation or a trust, partnership or other unincorporated organization must meet the definition of entity under section 2 of the Act and meet the criteria for being a reporting entity, as per section 9. In other words, a corporation or a trust, partnership or other unincorporated organization may be subject to the Act, but not required to report.

Determining whether an organization is an entity

The Act defines an entity as a corporation or a trust, partnership or other unincorporated organization that either:

  1. is listed on a stock exchange in Canada; or
  2. has a place of business in Canada, does business in Canada or has assets in Canada and that, based on its consolidated financial statements, and meets at least two of the following conditions for at least one of its two most recent financial years:
    1. it has at least $20 million in assets,
    2. it has generated at least $40 million in revenue, and
    3. it employs an average of at least 250 employees.

If a corporation or a trust, partnership or other unincorporated organization meets either of criteria (a) or (b) then it is an entity for the purposes of the Act. These criteria are exclusive; for example, a company with shares listed on the TSX Venture Exchange is an entity, even if it does not have a place of business in Canada or meet any of the size-related thresholds.

The categories of corporation, trust, partnership and other unincorporated organization should be interpreted broadly and extend to similar forms of business organization. For example, these categories include unlimited liability corporations, limited partnerships and royalty trusts.

The definition of entity includes entities headquartered and operating in Canada or in any other country or jurisdiction.

Business presence in Canada

For tax- and employment-related purposes, it should already be clear whether an entity has a place of business in Canada, does business in Canada or has assets in Canada. Entities should use the ordinary sense of these words and the criteria applied by the Canada Revenue Agency, given that no specific definitions are given or tests are prescribed in the Act.

Place of business means any premises, facilityor installation used to carry on business, whether or not it is used exclusively for that purpose. Premises, facilities or installations may be considered to be a place of business whether they are owned or rented, or, in some cases, where they are simply available to the business.

When determining whether an entity does business in Canada, it may consider the location(s) where: goods are produced, sold or distributed; employees are located; deliveries, payments, purchases or contracts are made or assets are acquired; and assets, inventories or bank accounts are located. This list is not exhaustive, and the relevant factors to consider will vary depending on the nature of the business. Doing business in Canada does not require having a place of business in Canada.

Assets are any property owned by a person or business. Assets include money, land, buildings, investments, inventory, cars, trucks, boats or other valuables that belong to a person or business. They also may include intangibles such as goodwill. The Act refers to gross (not net) assets, calculated based on consolidated financial statements.

Thresholds for assets, revenue and employees

The size-related thresholds (assets, revenue and employees) should be calculated based on consolidated financial statements, with asset and revenue values converted into Canadian dollars if those statements use a different currency.

The use of consolidated financial statements means that the reporting entity’s revenue, assets and employees include the revenue, assets and employees of any entity it controls (i.e., its subsidiaries). The reporting entity’s revenue, assets and employees do not include the revenue, assets and employees of any entity that owns or controls it (i.e., its parent).

The size-related thresholds refer to total (global) assets, revenue and employees. This means that assets are not restricted to assets located in Canada, revenue is not restricted to revenue from business activities in Canada and the number of employees includes those residing or employed in Canada or in any other jurisdiction.

Assets are to be calculated on a gross basis, not a net basis.

Employee has the same meaning as in Canadian common law. Employees include people employed on a full-time, part-time or temporary basis in Canada or in any other jurisdiction, and do not include independent contractors. The number of employees is the average number of people employed by the entity over the course of the financial year.

Determining whether an entity is a reporting entity

If a corporation or a trust, partnership or other unincorporated organization meets the definition of entity under the Act, it may be required to submit a report. As per section 9, reporting requirements apply to entities:

  1. producing, selling or distributing goods in Canada or elsewhere;
  2. importing into Canada goods produced outside Canada; or
  3. controlling an entity engaged in any activity described in paragraph (a) or (b).

Thus, if a corporation or a trust, partnership or other unincorporated organization falls within the Act’s definition of entity and meets at least one of the above criteria (a), (b) or (c), then it is required to submit a report.

If a corporation or a trust, partnership or other unincorporated organization is not involved in any of the activities described in (a), (b) or (c), then it does not need to report, even if it meets the definition of entity.

Meaning of producing, selling, distributing and importing goods

As per section 9, reporting obligations apply to entities engaged in either producing, selling or distributing goods in Canada or elsewhere; importing into Canada goods produced outside Canada; or controlling an entity engaged in either of those activities.

The Act specifies that the production of goods includes the manufacturing, growing, extracting and processing of goods. The terms selling, distributing and importing are not explicitly defined in the Act. However, the terms as they are used in the Act are not intended to capture services that solely support the production, sale, distribution or importation of goods. These include, for example, marketing, administrative services, financial services and software services. Entities should apply the ordinary sense of these words to judge whether they are engaged in any of these activities.

For the purposes of the Act, goods refers to goods that are the subject of trade and commerce, understood in the ordinary sense of the word.

An entity is considered to be importing goods into Canada if the entity is responsible for accounting for those goods under the Customs Act. Purchasing goods produced outside Canada from a third party, where that third party is considered to be the importer for the purposes of the Customs Act, does not count as importing goods.

There is no prescribed threshold for the minimum value of goods that an entity must produce, sell, distribute or import in order for Act to apply. The terms as they are used in the Act should be understood as excluding very minor dealings.

Meaning of control

Control includes both direct and indirect control and extends down the organizational chain. The term “control” should be applied broadly in a manner consistent with the purposes of the Act. For example, if the reporting entity controls a business that controls another business, both businesses are captured by the definition of control. The meaning of control also includes deemed control, as per subsection 10(2) of the Act.

Whether an entity controls another entity may be determined in accordance with an applicable accounting standard (e.g. International Financial Reporting Standards (IFRS), Generally Accepted Accounting Principles (United States) (GAAP), etc.). The definition of control is, however, not limited to the aforementioned accounting standards. Control should be considered in substance over form and may include situations in which an entity exercises joint control of an operation.

In the case of franchises, whether a franchisor needs to report depends on whether it controls, within the corporate sense, any entities engaged in the activities described in subsections 9(a) or 9(b). Whether a franchisee needs to report depends on what activities the franchisee is engaged in (i.e., the activities covered by section 9).

Guidance on report contents

Characteristics of a compliant response and best practices

A complete report will contain responses that are consistent with the information provided in the questionnaire. A complete report will also include the attestation with the required signature(s).

A report may be deemed non-compliant if any of these elements are missing, or if information included in the report is found to be knowingly false or misleading.

There is no prescribed level of detail required for the responses. Entities should use discretion in determining the appropriate level of detail proportionate to their size and risk profile, respecting the specified size and length requirements for the report.

Entities can provide additional information to supplement responses, if desired, including by providing links to relevant websites and publicly available documents. For example, entities may provide links to:

The Government of Canada recognizes that entities may be taking a range of actions related to human rights due diligence, environmental, social and governance (ESG) initiatives and other aspects of responsible business conduct (RBC) that are not specifically or exclusively focused on forced labour or child labour. Entities can include a description of these actions as they relate to purposes of the Act in the space provided for additional information. Entities can also connect the description of their actions in the present reporting year to foundational work undertaken in previous years.

The report will be a public-facing document, and entities are encouraged to use simple, clear language in their responses and to explain unfamiliar terms in order to make their report accessible.

Entities are expected to provide honest responses that describe the concrete actions that they have taken to address risks of forced labour and child labour, rather than purely aspirational statements. The report should focus on actions taken during the previous financial reporting year, with the recognition that some actions may span multiple years or lack a concrete start and end point. If entities have an action plan in place that includes goals and steps for the future, they are encouraged to mention it in their report, but the report itself is not intended to serve as a plan or mission statement.

The Act does not require entities to disclose commercially sensitive information that would expose them to legal risk or compromise the privacy of any persons. Entities are also not required to report on specific cases or allegations of forced labour or child labour. The description of the forced labour and child labour risks identified and the description of any remediation measures taken need not reference specific instances, persons or groups.

Components of the report

The questionnaire asks for the following identifying information about the entity and about the report:

Entities must address each of the requirements included in section 11 of the Act in their annual report. This includes:

Answering all the mandatory questions included in the questionnaire and submitting the attested report is sufficient to meet the legal requirements. Each of the requirements are explained in further detail in the sections below. Entities are encouraged to refer to the list of resources for further guidance as they prepare their report.

Subsection 11(1) provides that an entity must describe the steps it has taken during the previous financial year to prevent and reduce the risk that forced labour or child labour is used at any step of the production of goods in Canada or elsewhere by the entity or of goods imported into Canada by the entity.

As per subsection 11(3), an entity must provide information on each of the following:

  1. Its structure, activities and supply chains
  2. Its policies and its due diligence processes in relation to forced labour and child labour
  3. The parts of its business and supply chains that carry a risk of forced labour or child labour being used and the steps it has taken to assess and manage that risk
  4. Any measures taken to remediate any forced labour or child labour
  5. Any measures taken to remediate the loss of income to the most vulnerable families that results from any measure taken to eliminate the use of forced labour or child labour in its activities and supply chains
  6. The training provided to employees on forced labour and child labour
  7. How the entity assesses its effectiveness in ensuring that forced labour and child labour are not being used in its business and supply chains

Steps to prevent and reduce risks of forced labour and child labour

The questionnaire provides examples of measures that entities may have taken to prevent and reduce risks of forced labour and child labour. This list is not exhaustive, and entities are encouraged to name any other steps they have taken in the “Other” category. Entities are also encouraged to provide additional information describing their actions. Examples of additional information include:

If an entity controls other entities, it must also describe the steps that these controlled entities have taken to prevent and reduce risks of forced labour and child labour.

There may be overlap between the steps entities identify in this section and responses to subsequent questions, such as the questions on due diligence and on training for employees. This is expected and acceptable. A description of the steps taken is intended to capture the main elements of the entity’s response to forced labour and child labour risks, while the other questions ask for supplementary information addressing specific aspects of that response. 

Requirement (a) – Structure, activities and supply chains

Structure refers to the entity’s legal and organizational form. When reporting on structure, entities may include the following details:

For the purposes of the Act, activities include all pursuits undertaken by the entity in relation to the production, sale, distribution or importation of goods by the entity.

When reporting on activities, entities may include information on:

Entities should also describe the activities of any entities under their control. Note that entities are only required to report on the activities of subsidiaries that are entities with reporting obligations under the Act. For more information, entities should refer to the guidance on the application of the Act.

The supply chain includes suppliers of goods and services that contribute to the production of goods produced, sold, distributed or imported by the entity, from sourcing the raw materials to the final product. It therefore includes direct and indirect suppliers and service providers, both in Canada and outside Canada. An entity’s supply chain does not include the end users or customers who purchase its products or services.

When describing their supply chains, entities should aim to identify to the greatest extent possible the source countries or regions of origin of each of the goods and services used at each stage of the supply chain.

Entities should aim to provide a complete overview of their structure, activities and supply chains, meaning that they should not omit information about aspects of their structure, activities and supply chains that they have judged carry no risk of forced labour or child labour.

The lists of examples given above are not exhaustive, and entities are encouraged to provide additional information, as appropriate.

Requirement (b) – Policies and due diligence processes

Due diligence is a process to identify and respond to the real and potential adverse impacts of activities throughout the supply chain. The OECD Due Diligence Guidance for Responsible Business Conduct provides that the due diligence process and its support measures involve the following steps:

For more information on the meaning of due diligence and the ways in which an organization can implement due diligence practices, please see the list of additional resources.

If an entity controls other entities, it must also describe the policies and due diligence processes that these controlled entities have in place.

In an entity’s report, it may choose to describe how its policies and due diligence processes on forced labour and child labour relate to its environmental, social and governance (ESG) initiatives or to a broader organizational Responsible Business Conduct (RBC) strategy, policies or mandate.

Requirement (c) – Forced labour and child labour risks

The Act requires entities to identify parts of their activities and supply chains that carry a risk that forced labour or child labour being used either in the entity’s own activities, or in the activities of any entities it controls or those of its direct or indirect suppliers. Identifying parts of an entity’s activities and supply chains that carry a risk does not require indicating that forced labour or child labour was or is actually being used. Rather, entities are asked to show that they have considered the ways in which their activities and supply chains could potentially cause, contribute to or be directly or indirectly linked to actual or potential risk that forced labour or child labour is used by them or in their supply chains.

No sectors or industries involving the production, sale, distribution or importation of goods are assumed to be entirely free of forced labour and child labour risks. The purpose of reporting is not to certify that an entity is “risk-free,” but rather to demonstrate that the entity has taken steps to identify and address risks. The reporting exercise is intended to encourage transparency, not to penalize entities for having identified risks in their activities and supply chains.

Entities should not disclose commercially sensitive information or report on specific cases or allegations of forced labour or child labour in a manner that would create legal or privacy concerns.

The questionnaire allows entities to identify general aspects of their activities and supply chains that carry a risk of forced labour and child labour, as well as the sectors and industries that those risks relate to. Entities are encouraged to provide additional information. For example, entities may specify that they have identified risks related to a particular sector, industry, country or region; the production of a particular product; or a particular step in the supply chain.

Entities may choose to volunteer information about instances of forced labour or child labour that have been identified, but are not required to do so. If this information is included, entities should ensure that their report does not compromise any individual’s privacy. For example, entities may describe their response to forced labour or child labour identified in a particular part of their activities or supply chains using an anonymized case study.

Additionally, the questionnaire allows entities to describe the steps that they have taken to assess and manage the forced labour and child labour risks identified. In other words, entities should explain how they have identified risks (i.e., mapping supply chains, conducting a risk assessment, etc.) and how they have dealt with the risks identified. Entities may do this for each risk identified, or choose to provide a general description of how they assess and manage risks.

If an entity controls other entities, it must also describe the steps that these controlled entities have taken to identify, assess and manage forced labour or child labour risks in their activities and supply chains.

Requirement (d) – Remediation measures

Remediation and remedy refer to both the processes of providing remedy for an adverse impact and to the substantive outcomes (i.e., remedy) that can counteract, or “make good,” the adverse impact. In the case of business and human rights, which includes forced labour and child labour, remedies provided may take a range of forms, the aim of which will be to counteract or make good any human rights harms that have occurred. 

Appropriate remedies vary depending on the circumstances.

For more information on the meaning of remediation, please see the United Nations Guiding Principles on Business and Human Rights and the list of additional resources.

The questionnaire includes a list of possible remediation measures. This list is not exhaustive, and entities are encouraged to provide additional information.

If an entity controls other entities, it must also describe the remediation measures that these controlled entities have taken, if applicable.

As with reporting on risks of forced labour and child labour, the purpose of requiring entities to describe the measures they have taken to remediate any forced labour or child labour is to encourage transparency.

Entities should not disclose commercially sensitive information or report on specific cases or allegations of forced labour or child labour in a manner that would create legal or privacy concerns.

If entities have assessed that their activities and supply chains do not carry a risk of forced labour or child labour being used, and the question of remediation is considered not applicable, then stating this in their report would be sufficient to address this requirement. Alternatively, entities may indicate that no measures have been taken to remediate forced labour or child labour in their activities and supply chains, if that is the case.

Requirement (e) – Remediation of loss of income

Efforts to prevent and reduce the risk of forced labour and child labour can have the unintended consequence of contributing to a loss of income for vulnerable families. Requirement (e) refers to any measures taken to remediate the loss of income to the most vulnerable families that results from any measure taken to eliminate the use of forced labour or child labour in the entity’s activities and supply chains.

If an entity controls other entities, it must also describe the measures that these controlled entities have taken to remediate loss of income, if applicable.

As with requirement (d), if entities have judged that vulnerable families have not experienced loss of income as a result of steps the entity has taken to eliminate forced labour or child labour risks, or if no measures have been taken in this area, then stating this in the report is sufficient to address this requirement.

Requirement (f) – Training

Training on forced labour and child labour may take a range of forms, from formal training courses to awareness-raising activities. When reporting on the training that entities may provide to employees, they may choose to provide the following details:

This list of examples is not exhaustive, and entities are encouraged to provide additional information, as appropriate.

In addition to describing the training provided to an entity’s direct employees, entities may choose to describe any training or awareness materials provided to partners or suppliers, if applicable.

If an entity controls other entities, it must also describe the training that these controlled entities provide to employees on forced labour and/or child labour, if applicable.

Requirement (g) – Assessing effectiveness

The questionnaire includes a list of examples of steps entities may take to assess their effectiveness in ensuring that forced labour and child labour are not being used in their activities and supply chains. This list is not exhaustive, and entities are encouraged to provide additional information.

Entities are required to report on how they assess their effectiveness, not to give the results of that assessment. In other words, entities should describe the policies, processes and other actions they have implemented to measure and track their success in preventing and reducing risks of forced labour and child labour in their activities and supply chains.

Alternately, entities may indicate that no actions have been taken to assess their effectiveness in preventing and reducing risks of forced labour and child labour in their activities and supply chains. Stating this in a report is sufficient to address this requirement.

If an entity controls other entities, it must also describe how these controlled entities assess their effectiveness in ensuring that forced labour and child labour are not being used in their activities and supply chains.

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