Canadian Retail Supply Chains Face Scrutiny as $63.3B in Imports Linked to Labour Risk

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Canadian retailers importing electronics, apparel and other consumer goods could face greater pressure to document where their merchandise comes from as Ottawa considers tougher enforcement of Canada’s forced-labour import ban.

The regulatory push comes as new research from World Vision Canada estimates that $63.3 billion worth of goods imported into Canada in 2025 fell within product and country combinations where child or forced labour risks have been documented. The figure represents about 8% of Canadian merchandise imports and was 6.2% higher than in 2022.

Retail categories account for much of the exposure. Electronics represented $22.2 billion, clothing and textiles another $15.3 billion, gold $7.8 billion, and nearly $2 billion in coffee imports came from countries identified in the underlying data as presenting child- or forced-labour risks.

The $63.3-billion figure does not mean Canada imported that amount of merchandise proven to have been produced through forced or child labour. World Vision cross-references Canadian trade data with products and countries where the U.S. Department of Labor has documented evidence of those practices, making the calculation a measure of risk exposure rather than proof about individual shipments.

For retailers, that distinction could become increasingly important if Ottawa’s proposed enforcement regime advances. The issue is shifting closer to a practical question for importers: how much can they prove about where their merchandise came from and how it was produced?

Electronics and Apparel Dominate Identified Exposure

Electronics and clothing and textiles together accounted for $37.5 billion of the imports identified by World Vision. Two major consumer categories therefore sit at the centre of the supply-chain issue.

Coffee provides another example. World Vision estimates that Canada imported almost $2 billion of coffee from countries flagged for child- or forced-labour risk in 2025, up 58.9% from 2022, with Colombia, Brazil, Guatemala and Honduras accounting for about 85% of that value.

The challenge is that a finished product rarely tells the full sourcing story. An apparel company can know who supplied a garment without necessarily having the same visibility into the mill that produced its fabric or the origin of its raw materials. An electronics product can contain components that moved through several suppliers and countries before final assembly.

Jewellery presents similar questions when commodities such as gold are involved. Those complexities do not establish a labour violation, but they help explain why tracing one can be difficult.

Canadian Companies Acknowledge Supply-Chain Gaps

Canada already requires qualifying companies that produce or import goods to report on measures taken to identify and reduce forced- and child-labour risks under the Fighting Against Forced Labour and Child Labour in Supply Chains Act, which took effect in 2024.

Public Safety Canada’s analysis of reports filed in 2025 found that 44.2% of reporting entities had identified portions of their activities or supply chains carrying forced- or child-labour risks. Another 39.2% had begun identifying risks but reported gaps in their assessments, while 16.6% had not started the process.

Retail trade accounted for 8.9% of reporting entities. Raw materials and commodities, direct suppliers, geographic locations and the types of products being produced or imported were among the areas businesses most commonly examined.

The disclosures also illustrate the difference between identifying a vulnerable supply chain and finding an actual case of forced labour. Public Safety Canada reported that 91% of organizations said remediation questions did not apply because they had not identified an instance of forced or child labour in their supply chains.

For retailers, the harder question is how well a company can investigate and document a risk when regulators require an answer.

Electronic department in a store. Image: Reddit

Ottawa Proposes a Stronger Border Regime

Canada has prohibited goods produced wholly or partly through forced labour from entering the country since 2020, but enforcing that prohibition presents a practical problem. A border officer can inspect a physical product; labour conditions several tiers back in its production chain are another matter.

Bill C-35, the proposed Ban on Importing Goods Made with Forced Labour Act, would create a different enforcement mechanism. Introduced in June 2026 and currently at second reading in the House of Commons, the legislation would allow the federal government to establish a public list of goods where there are reasonable grounds to suspect forced labour was involved, including information identifying producers, countries or regions.

Importers of listed goods could then be required by the Canada Border Services Agency to provide prescribed information. If an importer could not produce the required information, the goods could be denied entry.

Important details have yet to be established, including what documentation importers would have to provide and how goods would be selected for the high-risk list. Bill C-35 also remains proposed legislation, so its eventual provisions could change as it moves through Parliament.

Even with those qualifications, the proposal would raise the commercial importance of supply-chain information. Canada’s current reporting regime largely requires qualifying companies to disclose what they are doing to identify risk. Under the proposed border regime, the underlying evidence could become relevant to whether particular merchandise is admitted to Canada.

Supply-Chain Data Becomes an Inventory Issue

For a retailer that directly imports goods, the implications extend beyond ESG reporting. Supplier mapping, sourcing documentation and the ability to trace production farther upstream can affect customs compliance, logistics and ultimately inventory availability.

Bill C-35 would not require every retailer to establish complete visibility into every product it sells. The proposed regime targets goods identified as presenting forced-labour concerns, but an importer caught within that system would be better positioned if it already had reliable records extending beyond its immediate vendor.

That turns a corporate-responsibility issue into an operating one. Merchandise that cannot clear the border on schedule creates the same basic retail problem as any other supply interruption: the product is not available when and where it was expected to be sold.

Retail Council of Canada supports efforts to prevent forced-labour goods from entering Canada but has called for a targeted and transparent enforcement regime. The organization has said importers need sufficient information and resources to comply without adding unnecessary cost and complexity to legitimate trade.

The policy challenge sits between those two objectives. Ottawa wants an import ban that can actually be enforced, while compliant businesses need a realistic way to demonstrate that products originating several layers into a global supply chain meet Canadian requirements.

Sourcing Decisions Could Carry a Higher Documentation Cost

Ottawa has also consulted separately on possible mandatory human-rights due-diligence requirements that could go beyond annual disclosure. Those proposals remain under development, but together with Bill C-35 they point toward greater expectations that companies understand conditions deeper in their supply chains.

For retailers, stronger traceability requirements could eventually affect supplier economics. A factory price does not represent the full sourcing cost if working with a supplier also requires extensive verification, additional documentation or carries a greater risk that merchandise will be delayed.

There is no evidence that Canadian retailers are about to abandon particular countries or suppliers because of Bill C-35. The more immediate implication is that a vendor’s ability to provide reliable sourcing information may become more valuable when retailers assess the operational risk attached to a purchase.

World Vision’s $63.3-billion estimate gives a sense of the potential scale. Electronics, apparel, food and commodities sold through Canadian retail all intersect with production regions where labour risks have been documented, even though the report does not establish that individual goods arriving in Canada were made under abusive conditions.

The harder question is how an importer proves the difference when regulators ask. If Canada’s proposed enforcement regime advances, the quality of a retailer’s supply-chain information could affect more than an annual disclosure; for certain merchandise, it could affect whether the goods reach Canadian stores at all.

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