The Canadian government emphasized to the Trump administration the importance of shielding Canada from potential new tariffs through its recent legislation tackling forced labor in supply chains. In a formal communication to the United States Trade Representative’s office, Canada reaffirmed its commitment to collaborating with the U.S. to eliminate forced labor globally.
Highlighting its existing prohibitions and supply chain transparency measures, Canada pointed out its newly introduced standalone legislation targeting forced labor imports. The government stressed that its ongoing cooperation with the U.S. negates the necessity for imposing additional Section 301 duties on Canadian goods, as stated in its submission on Monday.
Among over 1,500 submissions received, Ottawa’s position was conveyed ahead of a three-day hearing in Washington regarding President Donald Trump’s utilization of Section 301 of the Trade Act of 1974 to fortify tariffs around the U.S. Trade Representative Jamieson Greer had previously indicated that Canada, Mexico, the United Kingdom, and other countries should face 10% duties for insufficiently enforcing bans on forced labor.
Canada’s preexisting legislation aimed at addressing forced labor in supply chains mandates annual reports to the federal government. However, a recent bill, C-35, seeks to enhance enforcement by establishing a public list identifying products linked to forced labor and requiring importers to validate that goods from listed regions were not produced through slavery.
In separate submissions, Canadian business and industry groups advocated for alternative measures to combat forced labor, suggesting targeted bilateral enforcement cooperation over broad country-level tariffs, especially in the closely integrated North American market. The Section 301 investigations, following the Supreme Court’s ruling against Trump’s previous tariff strategies, were anticipated as the U.S. explored new avenues for imposing duties.
While the Canada-U.S.-Mexico Agreement has shielded Canada from some tariffs, the country continues to face separate duties on various industries. Numerous Canadian submissions emphasized the importance of maintaining CUSMA exemptions regardless of the trade investigation outcome to avert unintended consequences and disruptions to agricultural trade flows.
The National Foreign Trade Council, representing U.S. business enterprises, echoed the sentiments of Canadian submissions, advocating against broad tariffs as an effective tool to combat forced labor. The council emphasized the need to extend CUSMA exemptions to future tariffs and cautioned against penalizing all goods from a country, including those from companies actively working to eradicate forced labor from their supply chains.