Reporting requirements and deadlines under the Fighting Against Forced Labour and Child Labour in Supply Chains Act in Canada

The reporting requirements under Canada's Fighting Against Forced Labour and Child Labour in Supply Chains Act establish a comprehensive framework for annual disclosure that demands both transparency and accountability from covered organisations. The Act mandates that both entities and government institutions submit detailed reports to the Minister of Public Safety by May 31 of each year, covering their activities and supply chain due diligence efforts from the previous fiscal year.

For entities subject to the Act, the annual report must be submitted in the form and manner specified by the Minister and must be made available to the public. The report must be approved by the entity's governing body, such as the board of directors and must include specific information about the entity's structure, activities and supply chains. This approval requirement ensures that senior leadership takes ownership of the organisation's compliance efforts and the accuracy of the reported information.

The Act specifies seven key areas that must be addressed in the annual report. First, entities must provide their structure, activities and supply chains, including information about the entity's operations, subsidiaries and the nature of their business activities. Second, they must detail their policies and due diligence processes related to forced labour and child labour, including any codes of conduct, supplier agreements or other governance mechanisms. Third, entities must identify parts of their business and supply chains that carry a risk of forced labour or child labour being used and the steps taken to assess and manage those risks.

The fourth requirement involves measures taken to remediate any forced labour or child labour identified in the entity's activities and supply chains. This includes both reactive measures to address identified issues and proactive steps to prevent future occurrences. Fifth, entities must describe measures taken to remediate the loss of income to the most vulnerable families that results from measures taken to eliminate the use of forced labour or child labour in their activities and supply chains. The sixth requirement covers training provided to employees on forced labour and child labour, including the scope, frequency and content of such training. Finally, entities must assess the effectiveness of their measures to ensure that forced labour and child labour are not being used in their business and supply chains.

Government institutions have similar reporting requirements but with some variations that reflect their unique role in public administration. They must report on their policies and due diligence processes, risk identification and assessment, remediation measures, training programmes and effectiveness assessments. However, their reports focus more heavily on procurement practices and the measures taken to ensure that goods and services acquired by the government are not produced using forced labour or child labour.

The May 31 deadline is absolute and applies to all covered organisations regardless of their fiscal year end. This means that entities with fiscal years ending at different times throughout the year must still submit their reports by the same deadline. The first reporting deadline was May 31, 2024, covering activities from the entity's previous fiscal year or, for new entities, from the date the Act came into force.

To meet these reporting requirements effectively organisations should establish effective data collection and documentation systems well before the reporting deadline. This includes implementing regular supplier assessments, maintaining detailed records of due diligence activities and creating systems to track training programmes and their effectiveness. Organisations should also develop standardised reporting templates and establish clear responsibilities for different sections of the report.

Practical compliance strategies include conducting annual supply chain risk assessments, implementing supplier questionnaires and audits, establishing grievance mechanisms for reporting concerns and creating detailed documentation of all remediation efforts. Organisations should also maintain records of all training programmes, including attendance, content and effectiveness evaluations. Regular internal reviews of compliance efforts should be conducted throughout the year to ensure that the annual report accurately reflects the organisation's activities and achievements.

The public nature of these reports means that organisations must balance transparency with competitive sensitivity. While the Act requires detailed disclosure, entities should work with legal counsel to ensure that proprietary information is protected while still meeting the legislation's transparency objectives. The reports will likely be scrutinised by stakeholders, including investors, customers, civil society organisations and media, making accuracy and completeness essential for maintaining organisational reputation and credibility.