Editor’s note: Shamistha Selvaratnam is a LLM Candidate of the Advanced Masters of European and International Human Rights Law at Leiden University in the Netherlands and a contributor to the Doing Business Right project of the Asser Institute. Prior to commencing the LLM, she worked as a business and human rights solicitor in Australia where she specialised in promoting business respect for human rights through engagement with policy, law and practice.
of the UK, Australian and NSW Modern Slavery Acts are part of the international
trend towards greater regulation and transparency of modern slavery in
corporate supply chains and operations. For example, Canada has recently introduced
a modern slavery bill and Brazil introduced a ‘dirty
list’ to name and shame companies that engage in slave labour back in 2004.
This last blog of a series of articles dedicated to the global modern slavery
developments focuses on the modern slavery developments in jurisdictions other
than the UK and Australia.
In 2012, prior to
the introduction of the UK Modern Slavery Act, the California
Transparency in Supply Chains Act 2010 (CTSCA) (the Californian Act)
came into force. The Californian Act requires retail sellers or manufacturers
that are doing business in California
with annual worldwide gross receipts in excess of $100,000,000 to make certain
disclosures. In particular, they must disclose information relating to five
areas: verification, audits, certification, internal accountability, and
training. They must disclose to what extent (if any) they:
- Engage in verification of product supply chains to evaluate and
address risks of human trafficking and slavery.
- Conduct audits of suppliers to evaluate supplier compliance with
company standards for trafficking and slavery in supply chains.
- Require direct suppliers to certify that materials incorporated into
the product comply with the laws regarding slavery and human trafficking of the
country or countries in which they are doing business.
- Maintain internal accountability standards and procedures for
employees or contractors failing to meet company standards regarding slavery
- Provide company employees and management, who have direct
responsibility for supply chain management, training on human trafficking and
slavery, particularly with respect to mitigating risks within the supply chains
be made on the company’s website with a ‘conspicuous and easily understood
link’ to the requisite information. There is no public repository of
disclosures made by businesses; however, to date 1227 statements have been made
by 1292 companies. Examples of disclosures made by businesses can be found here
In the event of non-compliance with the Californian Act the Attorney General
can file a civil action for injunctive relief. However, to date the Attorney
General has not taken such action calling into question the efficacy of the Californian
Earlier this year,
members of the Hong Kong Legislative Council
introduced a draft Modern
Slavery Bill 2017 (HK) (the HK Bill) that is based on the UK Modern Slavery Act. If
passed into law, the HK Bill will require companies exceeding a specific threshold
amount to prepare and submit an annual Modern Slavery Statement. It also
provides claimants will a civil cause of action against companies that have
committed an offence under the HK Bill or knowingly benefited, financially or
by receiving anything of value from participation in a venture which that
company knew or should have known has engaged in an act in violation of the HK
Bill. Accordingly, it is the first modern slavery bill to give claimants a
cause of action to sue companies. However, there is no timeline for the HK Bill
to come into force and it is yet to be seen as to whether it will receive
support from the government.
In 2004 Brazil
introduced a ‘name-and-shame strategy’ in order to combat slavery by employers
(both businesses and people). In order for a business to be placed on the list,
the following process must be adhered to:
- A complaint must be submitted to the government or a civil society
- A labour investigation group investigates the complaint.
- If the labour inspectors find that the relevant business has
subjected its workers to ‘slave-like conditions’, charges will be laid against
the business and sent to the Ministry of Labour and Employment.
- The business may be required to pay a fine.
- If the business is found guilty of exploiting its workers, its name
will be put on the ‘dirty list’.
- The business will then be monitored for the subsequent two years
after which its name will be removed from the list if all fines are paid and it
does not subject its workers to slavery.
Since 2004 more
than 300 businesses have been placed on the list, which has affected those
businesses’ ability to obtain financing and has resulted in boycotting by the
business community and consumers.
On 13 December
2018 a bill was introduced into the House of Commons of Canada titled ‘C-423 – An
Act respecting the fight against certain forms of modern slavery through the
imposition of certain measures and amending the Customs Tariff’ (the Canadian Bill). The stated
purpose of the Canadian Bill is to:
Canada’s international commitment to contribute to the fight against
modern slavery through the imposition of reporting obligations on entities involved
in the manufacture, production, growing, extraction or processing of goods in Canada or elsewhere or in the importation
of goods manufactured, produced, grown, extracted or processed outside Canada (emphasis added).
An ‘entity’ is
defined as a corporation or a trust, partnership or other unincorporated
- is listed on a stock exchange in Canada;
- has a place of business in Canada, does
business in Canada or has assets in Canada and that, based on its consolidated
financial statements, meets at least two of the following conditions for at
least one of its two most recent financial years:
has at least $20 million in assets,
has generated at least $40 million in revenue,
employs an average of at least 250 employees.
If the Bill
passes the Canadian Parliament, such entities will be required to provide the
Minister with an annual modern slavery report that demonstrates:
- the steps the entity has taken during
the previous year to prevent and reduce the risk that forced labour
or child labour
is used at any step of the manufacture, production, growing, extraction or
processing of goods in Canada or elsewhere by the entity or of goods imported
into Canada by the entity.
that must be included in the report includes:
entity’s structure and the goods that it manufactures, produces, grows,
extracts or processes in Canada or elsewhere or that it imports into Canada;
entity’s policies in relation to forced labour and child labour;
entity’s activities that carry a risk of forced labour or child labour being
used and the steps it has taken to assess and manage that risk;
measures taken to remediate any forced labour or child labour; and
training provided to employees on forced labour and child labour.
In this respect the reporting criteria bear resemblance to the mandatory
reporting criteria contained in the Australian Modern Slavery Act (read more here). The report must include
an attestation made by a director (or officer) of the entity that the
information in the report is ‘true, accurate and complete’ and must be
available to the public, including by posting it in a ‘prominent place’ of the
If the Minister is of the opinion that an entity has not complied with the
requirements set out above, it may order that the entity ‘take measures that he or she considers to be
necessary to ensure compliance’ and the entity may be liable of an offence
punishable on summary conviction and liable to a fine of up to $250,000.
Accordingly, the Canadian Bill in its current form has more bite that both the
UK and Australian Modern Slavery Acts.
slavery developments discussed above show evidence of the global movement
towards combatting modern slavery in global supply chains and increasing
transparency by businesses in that respect. It demonstrates that governments
worldwide are taking the implementation of the UN Guiding Principles on
Business and Human Rights seriously and taking steps to ensure that corporates
(including the entities which they control) respect human rights in their
operations and activities. It is extremely likely that we will continue to see
more countries joining in the fight against modern slavery by implementing
legislation to regulate corporate supply chains and operations.