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Bill C-262

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First Session, Forty-fourth Parliament,

70-71 Elizabeth II, 2021-2022

HOUSE OF COMMONS OF CANADA

BILL C-262
An Act respecting the corporate responsibility to prevent, address and remedy adverse impacts on human rights occurring in relation to business activities conducted abroad

FIRST READING, March 29, 2022

Mr. Julian

441062


SUMMARY

This enactment, among other things, requires businesses to establish processes to prevent, address and remedy adverse impacts on human rights that occur in relation to their business activities conducted abroad.

Available on the House of Commons website at the following address:
www.ourcommons.ca


1st Session, 44th Parliament,

70-71 Elizabeth II, 2021-2022

HOUSE OF COMMONS OF CANADA

BILL C-262

An Act respecting the corporate responsibility to prevent, address and remedy adverse impacts on human rights occurring in relation to business activities conducted abroad

Preamble

Whereas the realities of global supply chains, cross-border trade, investment, communications and movement of people are such that Canadian business entities may cause adverse impacts on human rights outside Canada, either through their own activities or through their business relationships;

Whereas Canadian business entities have the responsibility to prevent and mitigate actual or potential adverse impacts on human rights that are linked to their business activities conducted outside Canada and, to that end, to act with due diligence;

Whereas the right to a remedy is a core tenet of the international human rights system, and the need for victims to have access to an effective remedy is recognized in the United Nations Guiding Principles on Business and Human Rights;

Whereas, at present, there is a lack of accountability and recourse and, in the event that a remedy is obtained, it often fails to meet international standards regarding what constitutes adequate, effective and prompt reparation for harm suffered;

Whereas ensuring the legal accountability of business entities and ensuring that affected individuals have access to an effective remedy is a vital part of a state’s duty to protect against business-related human rights violations;

And whereas effective state-based judicial mechanisms are at the core of ensuring access to an effective remedy;

Now, therefore, Her Majesty, by and with the advice and consent of the Senate and House of Commons of Canada, enacts as follows:

Short Title

Short title

1This Act may be cited as the Corporate Responsibility to Protect Human Rights Act.

Interpretation

Definitions

2(1)The following definitions apply in this Act.

affiliate means an affiliated entity within the meaning of subsection (2). (groupe)

business relationship, in respect of an entity, includes a relationship the entity has

  • (a)with any individual – including a home-based worker – or entity in its supply chain; and

  • (b)with any individual, entity or organization that is directly linked to its operations, products or services, including in relation to the provision of security services. (relation d’affaires)

entity means a corporation or a trust, partnership or other association but does not include a registered charity, non-profit organization or trade union. (entité)

human rights includes the right to a healthy environment and the rights recognized under the international human rights instruments listed in the schedule. (droits de la personne)

Minister means the Minister of Justice. (ministre)

Affiliated entities

(2)For the purposes of this Act, an entity is affiliated with another entity if

  • (a)one of them is the subsidiary of the other;

  • (b)both are subsidiaries of the same entity;

  • (c)both are controlled by the same individual or entity; or

  • (d)both are affiliated with the same entity at the same time.

Control

3(1)For the purposes of this Act, an entity is controlled by an individual or another entity if

  • (a)20% or more of the voting interests in the entity are held by or for the benefit of that individual or other entity, directly or indirectly;

  • (b)the individual or other entity, alone or in combination with another entity, is entitled through voting shares or on the basis of an agreement with another party, to cast at least 30% of the votes to elect the directors of the entity’s board, directly or indirectly;

  • (c)the individual or other entity influences the management and policies of the entity, directly or indirectly;

  • (d)the individual or other entity determines the salary or bonus structure of the entity’s executives or employees, directly or indirectly;

  • (e)the individual or other entity otherwise controls the entity in fact, directly or indirectly; or

  • (f)the individual or other entity publicly represents itself as being responsible for or in control of the entity.

Subsidiary

(2)An entity is a subsidiary of another entity if

  • (a)it is controlled by

    • (i)that other entity and no other,

    • (ii)that other entity and one or more entities each of which is controlled by that other entity, or

    • (iii)two or more entities each of which is controlled by that other entity; or

  • (b)it is a subsidiary of an entity that is a subsidiary of that other entity.

Purpose

Purpose

4The purpose of this Act is to prevent, address and remedy the adverse impacts on human rights that occur in relation to business activities conducted by entities abroad.

Application

Application

5This Act applies to an entity, other than an entity that is exempted by regulation from the application of this Act,

  • (a)that is incorporated or formed under an Act of Parliament or of the legislature of a province, or otherwise formed in Canada; or

  • (b)that has a place of business in Canada, carries on business in Canada or has assets in Canada that are used in carrying on the entity’s business.

Obligations

Duty to prevent adverse impacts — entity and its affiliates

6(1)In carrying out its business activities, every entity has a duty to avoid causing any adverse impacts on human rights from occurring outside Canada as a result of its acts or omissions or those of its affiliates.

Duty to prevent adverse impacts — business relationships

(2)Every entity has a duty to prevent any adverse impacts on human rights from occurring outside Canada as a result of its business relationships.

Liability of entity

(3)An entity is liable for any injury that results from its failure to comply with subsection (1) or (2), regardless of whether the injury resulted from an act or omission of the entity, its affiliate or an individual with whom the entity has a business relationship.

Due diligence — procedures

7(1)Every entity must develop and implement due diligence procedures in respect of its activities, its affiliates and its business relationships, including procedures enabling the entity to

  • (a)identify and assess actual and potential adverse impacts on human rights resulting from its activities as well as from its business relationships, including with suppliers or contractors;

  • (b)cease any activity that led to the adverse impacts and take remedial action;

  • (c)mitigate risks of adverse impacts; and

  • (d)by means of an internal alert mechanism, be notified of any potential adverse impacts on human rights.

Monitoring

(2)Every entity must monitor and document the implementation and effectiveness of its due diligence procedures.

Implementation

8In developing and implementing its due diligence procedures, an entity must

  • (a)take into account the intersection of sex and gender with other identity factors that include race, national and ethnic origin, Indigenous origin or identity, age, sexual orientation, socio-economic condition, place of residence and disability;

  • (b)consult with individuals whose human rights may be directly affected, or representatives of those individuals, as well as with trade unions, employees, affected communities and other relevant stakeholders, including independent experts;

  • (c)take into account the standards, practices and procedures recommended by international organizations in relation to businesses and human rights, including those set out in the United Nations Guiding Principles on Business and Human Rights, endorsed by the Human Rights Council in its resolution 17/4 of June 16, 2011; and

  • (d)have regard to the relationship between human rights and the environment, specifically that a healthy and sustainable environment is integral to the full enjoyment of a wide range of human rights, including the rights to life, health, sustainably produced food and safe water.

Due diligence annual report

9Within one year after the day on which this Act comes into force, and every year after that, every entity must, in accordance with any regulations, make public a report on its due diligence that sets out, for the year to which the report relates,

  • (a)the due diligence procedures that the entity has established and the effectiveness of their implementation;

  • (b)the entity’s business activities and business relationships, including those in connection with any of its operations, products or services, in respect of which its due diligence procedures apply;

  • (c)a list of the entity’s affiliates in respect of which its due diligence procedures apply;

  • (d)the entity’s activities in respect of which a risk of adverse impacts on human rights has been identified and the measures that the entity has taken to assess and mitigate the risk; and

  • (e)any other information required by regulation.

Private Right of Action

Right to bring an action — loss or damage suffered

10(1)A person who alleges that they have suffered loss or damage as a result of a failure by an entity to comply with its obligations to prevent adverse impacts under this Act may, in a superior court of a province, bring an action against the entity and, in the action, claim relief by way of one or more of the following:

  • (a)damages for any loss or damage suffered;

  • (b)aggravated or punitive damages;

  • (c)an injunction;

  • (d)an order for specific performance;

  • (e)the cost of any land remediation; and

  • (f)any other appropriate relief, including the costs of the action.

Right to bring an action — due diligence procedures

(2)An action may be brought against an entity in respect of the entity’s failure to develop and implement due diligence procedures provided that the matter arises in the context of the protection of human rights.

Who may bring action

(3)The action under subsection (2) may be brought by any person who raises a serious issue and is either directly affected by the matter or

  • (a)has a genuine interest in the matter;

  • (b)presents a reasonable means of advancing the proceeding; and

  • (c)has no conflict of interest with regard to the outcome.

Relief

(4)In an action brought under subsection (2), the person may claim relief by way of one or more of the following:

  • (a)damages for any loss suffered;

  • (b)aggravated or punitive damages;

  • (c)an injunction;

  • (d)an order for specific performance; and

  • (e)any other appropriate relief, including the costs of the action.

Prosecution not precluded

11Nothing in this Act precludes the prosecution by the Attorney General of Canada of any offence under the Criminal Code or any other Act of Parliament.

Limitation period of five years

12(1)A person may bring an action under subsection 10(1) only within a limitation period of five years beginning on the later of

  • (a)the day on which the person becomes aware of the act or omission on which the action is based, and

  • (b)the day on which any criminal proceedings relating to the act or omission are finally disposed of.

Limitation period of two years

(2)A person may bring an action under subsection 10(2) only within a limitation period of two years beginning on the day on which the person becomes aware of the failure by the entity to comply with subsection 7(1).

Suspension of limitation period

(3)A limitation period in respect of an action brought against an entity under section 10 is suspended during any period in which the person that suffered the loss or damage

  • (a)is incapable of beginning the action because of any physical or mental condition; or

  • (b)is unable to ascertain the identity or the involvement of the entity.

No limitation period

(4)An action arising out of an alleged sexual assault may be commenced at any time.

Common law

(5)Nothing in this section is to be construed as affecting any right or authority at common law to suspend the limitation period.

Defence

13(1)In an action under subsection 10(1), it is a defence for the entity to establish that it exercised all due diligence to prevent the adverse impact on human rights in respect of which the action is brought.

Factors to consider

(2)In determining whether an entity exercised all due diligence, the court may consider

  • (a)the extent to which the entity complied with any standards of conduct set out in the regulations;

  • (b)whether the adverse impact on human rights was, or could have been, identified as a potential risk by the entity in its due diligence procedures;

  • (c)whether the entity has a history of causing or contributing to adverse impacts on human rights;

  • (d)whether the entity has, in its business relationships with its suppliers, created any incentives to improve human rights standards; and

  • (e)any other factors that the court considers relevant.

Jurisdiction of Canadian court

14(1)A Canadian court has jurisdiction to hear and determine an action brought under section 10 if

  • (a)the entity is domiciled or ordinarily resident in the court’s jurisdiction;

  • (b)the entity submits to the court’s jurisdiction; or

  • (c)there is a real and substantial connection between the court’s jurisdiction and the facts on which the action against the entity is based.

Defendant submits to jurisdiction

(2)An entity submits to the jurisdiction of a court if it explicitly submits to the jurisdiction of the court by written agreement or otherwise, either before or after the proceedings commence.

Ordinarily resident

(3)An entity is ordinarily resident in a court’s jurisdiction if

  • (a)it has or is required by law to have a registered office or business address in the court’s jurisdiction;

  • (b)it has registered an address in the court’s jurisdiction at which process may be served;

  • (c)it has nominated an agent or mandatary in the court’s jurisdiction on whom process may be served;

  • (d)it has an agent or mandatary, representative, warehouse or place of business in the court’s jurisdiction; or

  • (e)its central management and control is exercised in the court’s jurisdiction.

Real and substantial connection

(4)There is deemed to be a real and substantial connection between the court’s jurisdiction and the facts on which the action against the entity is based if

  • (a)the action relates to business that is conducted in person in the court’s jurisdiction over a sustained period;

  • (b)the action is brought in respect of a tort or fault within the meaning of the Civil Code of Québec that is alleged to have been committed wholly or partially in the court’s jurisdiction;

  • (c)the action relates to obligations under a contract that was entered into in the court’s jurisdiction or is governed by the laws of that jurisdiction;

  • (d)the action concerns restitutionary obligations arising wholly or in substantial part in the court’s jurisdiction; or

  • (e)relief is sought by way of an injunction ordering a party to do or refrain from doing anything in the court’s jurisdiction.

No limitation

(5)Subsection (4) is not to be construed as limiting the plaintiff’s right to rely on other circumstances to establish a real and substantial connection.

Jurisdiction

(6)A court may not refuse to exercise jurisdiction on the sole ground that the matter should be decided by a court outside Canada.

Other proceedings

(7)An action brought under section 10 is not affected by any proceedings in respect of the same matter that are pending before any court outside Canada or by any decision of such a court.

Proceedings not precluded

15Nothing in this Act is to be construed as precluding the commencement or continuation of proceedings under any other Act of Parliament, or any civil proceedings, in respect of the activities of an entity.

Conflict of Laws

Conflict of laws

16(1)In the event of any inconsistency or conflict between the provisions of this Act or a regulation made under it and any other federal or provincial law, this Act or its regulations prevail to the extent of the inconsistency or conflict.

Agreement or arrangement

(2)Any provision of an agreement or arrangement that is inconsistent with or conflicts with the provisions of this Act or a regulation made under it is void to the extent of the inconsistency or conflict.

Other obligations

(3)Nothing in this section is to be construed as affecting any requirement imposed on an entity under any other federal law, any provincial or foreign law or any contract or arrangement that is more stringent than the requirements under this Act.

Miscellaneous

Withdrawal of government support

17If there are reasonable grounds to believe that an entity has failed to meet its obligations under this Act, the Minister must recommend to the Governor in Council that any government support or funding that is provided to the entity be withdrawn for a specified period or until the entity is in compliance with the Act.

Legislative proposal — commissioner

18(1)Within one year after the day on which this Act comes into force, the Minister must cause to be tabled in each House of Parliament a legislative proposal that would provide for the appointment of a commissioner whose mandate would be to ensure that entities that have business activities or business relationships abroad comply with section 9.

Content of proposal

(2)The proposal must, among other things, address the following:

  • (a)the method of appointment, tenure and remuneration of the commissioner;

  • (b)the general duties and powers of the commissioner;

  • (c)the verification of the compliance of entities with their obligations under this Act; and

  • (d)the conduct of the commissioner’s office, including the appointment of the necessary employees.

Orders and Regulations

Regulations

19(1)The Governor in Council may make regulations for carrying out the purposes and provisions of this Act, including regulations

  • (a)specifying what an entity must include in its due diligence procedures, including auditing procedures and standards of conduct;

  • (b)setting out standards and guidelines to be used by an entity in the assessment of the effectiveness of its due diligence procedures;

  • (c)providing for the exemption of an entity or a class of entities from the application of any provision of this Act, including on the basis of revenue or number of employees; and

  • (d)respecting the information that an entity must include in the annual report referred to in section 9.

Tabling and referral of proposed regulations

(2)The Minister must cause each regulation that is proposed to be made to be tabled before each House of Parliament, and each House must refer the proposed regulation to the appropriate committee of that House.

Alteration of proposed regulation

(3)A proposed regulation that has been tabled before each House of Parliament under subsection (2) does not need to be tabled before either House again if it has been altered.

Amendment of schedule

20The Governor in Council may, by order, amend the schedule by adding or deleting a reference to an international human rights instrument.



SCHEDULE

(subsection 2(1) and section 20)
International Human Rights Instruments

Abolition of Forced Labour Convention, 1957

Convention sur l’abolition du travail forcé, 1957

Convention against Torture and Other Cruel, Inhuman or Degrading Treatment or Punishment

Convention contre la torture et autres peines ou traitements cruels, inhumains ou dégradants

Convention on Access to Information, Public Participation in Decision-Making and Access to Justice in Environmental Matters

Convention sur l’accès à l’information, la participation du public au processus décisionnel et l’accès à la justice en matière d’environnement

Convention on Combating Bribery of Foreign Public Officials in International Business Transactions

Convention sur la lutte contre la corruption d’agents publics étrangers dans les transactions commerciales internationales

Convention on the Elimination of All Forms of Discrimination against Women

Convention sur l’élimination de toutes les formes de discrimination à l’égard des femmes

Convention on the Rights of the Child

Convention relative aux droits de l’enfant

Convention on the Rights of Persons with Disabilities

Convention relative aux droits des personnes handicapées

Declaration on the Right and Responsibility of Individuals, Groups and Organs of Society to Promote and Protect Universally Recognized Human Rights and Fundamental Freedoms

Déclaration sur le droit et la responsabilité des individus, groupes et organes de la société de promouvoir et protéger les droits de l’homme et les libertés fondamentales universellement reconnus

Discrimination (Employment and Occupation) Convention, 1958

Convention concernant la discrimination (emploi et profession), 1958

Equal Remuneration Convention, 1951

Convention sur l’égalité de rémunération, 1951

Forced Labour Convention, 1930

Convention sur le travail forcé, 1930

Freedom of Association and Protection of the Right to Organise Convention, 1948

Convention sur la liberté syndicale et la protection du droit syndical, 1948

Indigenous and Tribal Peoples Convention, 1989

Convention relative aux peuples indigènes et tribaux, 1989

International Covenant on Civil and Political Rights

Pacte international relatif aux droits civils et politiques

International Covenant on Economic, Social and Cultural Rights

Pacte international relatif aux droits économiques, sociaux et culturels

International Convention for the Protection of All Persons from Enforced Disappearance

Convention internationale pour la protection de toutes les personnes contre les disparitions forcées

International Convention on the Elimination of All Forms of Racial Discrimination

Convention internationale sur l’élimination de toutes les formes de discrimination raciale

International Convention on the Protection of the Rights of All Migrant Workers and Members of Their Families

Convention internationale sur la protection des droits de tous les travailleurs migrants et des membres de leur famille

Minimum Age Convention, 1973

Convention sur l’âge minimum, 1973

Right to Organise and Collective Bargaining Convention, 1949

Convention sur le droit d’organisation et de négociation collective, 1949

United Nations Declaration on the Rights of Indigenous Peoples

Déclaration des Nations Unies sur les droits des peuples autochtones

Worst Forms of Child Labour Convention, 1999

Convention sur les pires formes de travail des enfants, 1999


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