Canada is facing pressure to strengthen its legislation against forced labour in China following criticism from the U.S. Trade Representative (USTR) that the country is not adequately enforcing existing laws. The USTR’s Section 301 investigation has threatened the imposition of 10-percent tariffs on Canadian products not covered by the United States-Mexico-Canada Agreement (USMCA) due to insufficient measures addressing forced labour concerns.

Critics argue that Canada initially made progress in developing stricter forced labour legislation and enforcement mechanisms but reversed course after a state visit to China. According to advocacy groups and experts, government officials paused legislative drafting and cut staff reviewing products from Xinjiang—a region heavily implicated in forced labour—redirecting resources instead toward expanding trade relations with China. Notices to Canadian companies and references in official documents regarding forced labour compliance reportedly diminished during this period.

Despite clear evidence of forced labour in various Chinese exports, Canada has rejected only two shipments under its current regulations. At the same time, the country continues to import Chinese electric vehicles (EVs), some of which contain aluminum components linked to forced labour practices. Investigations have documented that bauxite, the raw material for aluminum, is sourced from Uyghur forced labour camps in Xinjiang before being processed and shipped to EV manufacturers, including major international brands.

Forced labour conditions reported in Xinjiang involve extended work hours under armed surveillance, minimal food, and no compensation, drawing comparisons to historic slavery. Uyghur workers are implicated in the production of not only aluminum but also agricultural goods such as cotton and tomatoes found in global supply chains.

In response to these challenges, Canada is moving forward with Bill C-35, legislation that empowers the Foreign Affairs Minister to designate products and components produced wholly or partially through forced labour, including by region or country. While this approach does not fully align with U.S. law—which presumes that all goods from Xinjiang are forced-labour-made unless proven otherwise—Bill C-35 seeks to mirror elements of the U.S. Withhold Release Orders system. The American system bans high-risk products unless importers can demonstrate they are free of forced labour.

The urgency for stronger measures has increased following China’s recent regulation classifying all supply chain sources under its national security framework, effectively restricting transparency and complicating efforts to verify labour practices.

Canadian officials have been reticent about the economic impacts of these policies or potential trade negotiations with the U.S., emphasizing confidentiality in ongoing discussions. Observers note that the evolving legislative landscape will play an important role in aligning Canada’s trade policies with human rights considerations amid growing global scrutiny of forced labour practices linked to Xinjiang.