Last week, the Government of Canada tabled new legislation that would completely rewrite Canadian forced labour enforcement. If adopted, Bill C-35, An Act respecting the prohibition of the importation of goods produced by forced labour (also known as Ban on Importing Goods Made with Forced Labour Act) would repeal the current import prohibition that exists under the Customs Tariff and replace it with a new freestanding framework that would impose a reverse onus on importers to prove goods were not produced with forced labour. The bill would also significantly expand enforcement powers for the Canada Border Services Agency (CBSA). This bill seeks to more closely align Canada’s forced labour enforcement with the enforcement approach taken by the United States.
The current regime, and why it is under pressure
Canada has prohibited the importation of goods mined, manufactured, or produced wholly or in part by forced labour since July 2020, when Canada enacted its commitment to prohibit such goods under CUSMA. To date, the CBSA has attempted to enforce this import prohibition on a shipment-by-shipment, case-by-case basis. Since January 2024, Canada has also extended the import prohibition to child labour and layered on annual reporting obligations.
In practice, enforcement has been thin. The Canadian Press recently reported that since 2020 CBSA has detained 50 shipments on forced labour concerns but only two shipments were denied entry to Canada. Critically, the current regime contains no rebuttable presumption. Bill C-35 is, in large part, an attempt to supply the statutory authority the CBSA was found not to have.
The Canadian status quo drew sharp U.S. attention. On June 2, 2026, following a Section 301 investigation, the USTR concluded that Canada (among other countries) had failed to effectively enforce its forced labour prohibition, and recommended a 10% tariff on affected Canadian goods (though the proposal included exemptions for, e.g., goods that qualify under CUSMA). On June 3, Minister Dominic LeBlanc signalled that Canada would make its regime “even stronger” through new legislation; Bill C-35 followed nine days later. The bill arrives just ahead of the July 2026 CUSMA review, where forced labour is likely to be a focus.
What the bill would change
The centrepiece of Bill C-35 is a new listing-and-disclosure mechanism. The bill authorizes the Minister of Foreign Affairs to establish a list of goods identified by producer, and/or by country or region of production, for which there are reasonable grounds to suspect that they are produced wholly or in part by forced labour.
Listed goods are not banned outright. But when requested, an importer must provide the CBSA with prescribed “enhanced supply chain tracing information” (the specifics are still to come in regulations). If the importer fails to do so on request, the goods are deemed prohibited. In practical effect, this shifts the burden onto importers. This is a significant change from today’s regime where the CBSA must establish that the goods are produced with forced labour.
The reverse onus approach is consistent with the burden-shifting that U.S. authorities achieve for some forced labor enforcement through the Uyghur Forced Labor Prevention Act. However, the designs and scope differ: C-35 permits the development of a list of specific goods rather than imposing a blanket presumption on any goods produced by a listed entity or, wholly or in part, in a specific region. The Canadian approach will mean that importers will need to ensure they implement compliance programs specifically designed to comply with the Canadian list. To the extent that the Canadian list of goods differs from the U.S. list in terms of the producers, and/or country or region of production, it will not be sufficient to develop a program for U.S. compliance and rely on that for Canadian purposes.
Expanded CBSA powers and narrowed review rights
Bill C-5 pairs the new listing regime with markedly stronger enforcement tools and fewer ways to challenge how they are used. A CBSA officer would be empowered to determine whether goods were produced wholly or in part by forced labour whether they appear on the Minister’s list or not, and could detain suspect goods for up to 90 days (or longer if regulations allow). If imported goods are found to be produced with forced labour, the importer and the owner of the goods would be jointly liable for the costs of detention, storage, transportation, and disposal which could be significant for high-volume shipments. These new features would make the allocation of import responsibilities and liabilities and the timing of title transfer between commercial parties even more important.
Notably, these forced-labour determinations would sit outside the usual Customs Act machinery of appeals and re-determinations. The only route to challenge a decision would be judicial review in the Federal Court, which carries a 30-day deadline. That is a short window for an issue with potentially significant consequences for a business and underlines just how important it will be for businesses to stay alert and set up procedures to handle a detention made on this basis if this Act becomes law.
Which products and regions could be in scope
Designations under the Canadian bill would most likely be made through Canada’s own findings. However, given Canada’s desire to align measures with the United States, looking to the U.S. regime is likely a good indication of where listings will land.
- Xinjiang is the most obvious candidate. Since January 2021, Canada has maintained several Xinjiang-specific measures including a Xinjiang Integrity Declaration that companies must sign to access Trade Commissioner Service support, a business advisory on Xinjiang-related entities, enhanced due-diligence guidance, targeted sanctions, and stricter export controls. The region is a dominant global source of cotton and tomato products and a major source of polysilicon (a key solar-panel input), among others.
- The U.S. Bureau of International Labor Affairs (ILAB) listed goods. ILAB publishes a list of goods and their source countries that it has reason to believe are produced by child labour or forced labour. This List of Goods Produced by Child Labor or Forced Labor (the TVPRA list) is widely used internationally as a due-diligence reference, including by Canadian businesses. The list identified 204 goods from 82 countries in its 2024 edition. Agricultural goods dominate, with cotton, sugarcane, coffee, tobacco, cattle, rice, and fish appearing most often; in manufacturing, bricks, garments, textiles, footwear, carpets, polysilicon, aluminum, and fireworks recur; among mined goods, gold, coal, and diamonds are most common.
- U.S. border enforcement shows what active interdiction looks like. U.S. Customs and Border Protection (CBP)’s Withhold Release Orders (WROs) and Findings cover goods originating in many countries including China, the Democratic Republic of the Congo (DRC), India, Japan, Malawi, Malaysia, Mexico, Nepal, Turkmenistan, and Zimbabwe. Key commodities and sectors include (among others):
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- Cotton, textiles, and finished apparel;
- Tomatoes and other agricultural products (including stevia and sugar);
- Polysilicon, solar components, and silica-based products;
- Seafood harvested by distant-water fishing fleets;
- Disposable gloves and other rubber products (notably from Malaysia);
- Palm oil; and
- Cobalt, gold, tin, tantalum, and tungsten
Recent U.S. actions show how broadly enforcement can reach, extending to bicycles, tires, aluminum, and salt alongside the higher-profile sectors.
Canadian designations will be based on Canada’s own findings, and the U.S. lists carry no formal weight under Canadian law. But businesses sourcing in these categories or relying on suppliers with upstream exposure to the categories should at this stage consider their exposure were these to be added to Canada’s list.
What it means for importers
For importers sourcing from higher-risk jurisdictions, the listing-and-disclosure regime would fundamentally change the evidentiary posture at the border. Once a relevant good is listed, robust traceability, documented due diligence, and credible supply chain certifications become necessary. The ability to document production free from forced labour and produce relevant documents promptly upon request will be the difference between clearing customs and having goods deemed prohibited. And because a CBSA officer can act on goods that are not yet listed, that documentation matters even before a formal listing appears.
Companies should already be mapping their exposure:
- identifying inputs and suppliers tied to goods, producers, or regions likely to be listed;
- stress-testing the documentation they could put before the CBSA;
- building toward the supply chain tracing the regulations are expected to require; and
- revisiting the contractual allocation of import responsibility and detention costs.
What it means for retailers and distributors
Liability under the new regime does not end with the importer of record. A Canadian retailer or distributor that never files an import entry can still be caught the moment it handles the goods. Section 15 of the Customs Act turns possession into a duty: a business holding goods it has reason to believe were unlawfully imported must alert the CBSA promptly. Section 155 prohibits the purchase, sale, possession, or other dealing in goods that crossed the border in breach of the Act. Either misstep can carry fines of up to $500,000, imprisonment for as long as five years, or both. The moment a product, producer, or sourcing region lands on the Minister’s list, the firms stocking or reselling those goods can draw scrutiny from customers, journalists, and advocacy groups well before any finding is made. For retailers and distributors, that reframes supplier vetting and forced-labour warranties and indemnities in supply contracts as enterprise-level risk management rather than routine procurement.
Timing and next steps
Bill C-35 received first reading on June 12, 2026. However, Parliament has just adjourned for summer and will return on September 21, 2026. While U.S. trade pressure may accelerate timelines, timing remains uncertain. We also await any amendments to the bill and the release of important regulations that will further inform how the regime will operate. The next few months present an important opportunity for businesses to prepare for these significant changes.
Our Ottawa and Washington, D.C. offices advise many clients on forced labour compliance, including assistance in handling detained shipments. We are well-positioned to assist businesses in understanding, preparing for, and navigating Canada’s new forced labour regime.