Canada’s Supply-Chain Transparency Amendment, passed in 2025, marks a major development in the nation’s effort to strengthen ethical sourcing and human rights protections. This legislation introduces a ban on the importation of goods produced wholly or partially using child labor, raising the bar for supply-chain governance. Import managers across Canada must now adopt a more rigorous, data-backed approach to supplier assessment, moving beyond declarations and self-reported compliance. The amendment places direct responsibility on companies to demonstrate that every link in their supply chain meets the country’s child labor standards.
One of the most valuable tools available to Canadian importers is the International Labour Organization’s Decision Tree Toolkit. This structured framework helps procurement and compliance teams evaluate where their supply chains may be vulnerable to child labor risks. The toolkit encourages companies to assess their suppliers according to factors such as country of origin, production processes, product type, and historical risks in the sector. Garment importers, for instance, can use this decision-making model to identify not only risks at Tier 1 manufacturing sites but also deeper in the chain at spinning mills or cotton farms. By applying this tool early in the procurement process, import managers can make informed decisions about whether to proceed, seek further verification, or disengage from high-risk suppliers altogether.
Open international customs data has also emerged as an essential component of compliance efforts under the new amendment. By analyzing import and export records from partner jurisdictions such as the European Union, United States, and other major economies, importers can validate supplier claims and flag suspicious trade patterns. If a supplier suddenly begins shipping large quantities from a region notorious for labor violations, it may warrant further investigation before purchase orders are finalized. This data provides an independent, verifiable source of information that helps companies move beyond reliance on supplier-provided documents. It also enables import managers to cross-check the origin, volume, and routing of goods, thereby strengthening supply-chain traceability in line with Canada’s legislative requirements.
Equally important is the systematic verification of supplier practices before entering into contracts. Canadian companies are expected to collect and assess documentary evidence that proves suppliers are adhering to international child labor standards. This typically begins with a review of the supplier’s formal policies to ensure they include a clear, enforceable commitment to eliminating child labor. Import managers should examine third-party certifications issued by credible organizations that specialize in labor rights compliance. Certifications such as SA8000 or membership in programs like the Fair Labor Association are strong indicators that suppliers undergo regular audits and have mechanisms in place to prevent labor abuses.
In addition to internal documentation and certifications, it is essential to consult external sources, including reports by respected non-governmental organizations and labor rights monitors. These reports can provide crucial on-the-ground insights into working conditions in specific regions or facilities. Where risks are identified, importers must seek evidence that corrective actions have been implemented, such as age verification procedures, improved recruitment practices, or independent monitoring. Recent independent audit reports, when available, offer another critical layer of assurance. These reports help confirm that suppliers are meeting their obligations and that any prior issues have been addressed appropriately.
Open customs and trade data further enhance the ability of importers to cross-check supplier claims. By comparing customs declarations with trade flows visible in public records, importers can spot inconsistencies in production origin or shipment volumes. This added layer of data analysis helps prevent suppliers from obscuring the true source of goods and ensures that Canadian firms meet the transparency demands of the new law. Where discrepancies arise, importers must investigate fully and document their findings and any mitigation actions taken.
To comply fully with the Supply-Chain Transparency Amendment, import managers should establish a consistent, documented process that applies these verification steps before approving suppliers. This process will support both regulatory compliance and the company’s broader commitment to ethical trade. Documenting decisions and evidence at each stage helps create an audit trail that can be presented to authorities if required and reinforces accountability within the company’s procurement functions. It also demonstrates to external stakeholders—including customers and investors—that the company takes its human-rights obligations seriously.
In light of this legislative change, Canadian companies are encouraged to integrate these due-diligence practices into their standard procurement workflows rather than treating them as one-off exercises. The amendment signals that child labor risks must be considered an ongoing area of concern, not simply a compliance box to check at the start of a supplier relationship. Firms that embed robust monitoring and verification into their sourcing strategies will be best positioned to comply with Canada’s requirements while also contributing to the global movement to eliminate child labor from international trade.
The Supply-Chain Transparency Amendment challenges Canadian businesses to elevate their standards for supplier evaluation and risk management. Fortunately, tools like the ILO Decision Tree Toolkit, open international customs data, and credible third-party audits provide import managers with practical solutions for meeting these challenges. Companies that act now to strengthen their supply-chain oversight will not only reduce legal and reputational risks but also help drive positive change in global labor practices. In this new regulatory environment, doing the right thing and doing the smart thing are one and the same.