Dan Brecher
Counsel
212-286-0747 dbrecher@sh-law.comAuthor: Dan Brecher|August 20, 2015
Under the Modern Slavery Act, a “commercial organization” must prepare a slavery and human trafficking statement for each financial year. The mandatory corporate disclosure must state the steps the organization has taken to ensure that slavery and human trafficking are not taking place in any of its supply chains and in any part of its own business, or that the organization has taken no such steps.
A “commercial organization” is broadly defined as a corporation or partnership that carries on a business, or part of a business, in any part of the United Kingdom. However, the disclosure obligations apply to companies with a turnover of over £36 million.
Pursuant to the UK statute, a company’s statement may include the following information:
It is important to highlight that the statute does not create an affirmative obligation to develop a compliance program to address human trafficking in the supply chain. However, companies must publicly disclose that they do not have any policies or procedures in place. Accordingly, the British government is relying on pressure from the public, as well as advocacy organizations, to encourage corporations to voluntarily adopt measures to combat slavery and human trafficking in their supply chains.
The UK’s mandatory annual reporting requirements take effect in October. The Secretary of State is expected to publish additional compliance guidance in the near future.
In the United States, California is currently the only state to require businesses to disclose the steps they are taking to combat slavery and human trafficking. However, federal legislation could be on the horizon.
Last month, U.S. Representatives Carolyn Maloney (D-NY) and Chris Smith (R-NJ) introduced the Business Supply Chain Transparency on Trafficking and Slavery Act of 2015 (H.R. 3226), which would require publicly traded companies with over $100 million in annual worldwide gross receipts to disclose their policies on human trafficking, slavery, and forced labor on their websites as well as in annual reports filed with the Securities and Exchange Commission (SEC).
Counsel
212-286-0747 dbrecher@sh-law.comUnder the Modern Slavery Act, a “commercial organization” must prepare a slavery and human trafficking statement for each financial year. The mandatory corporate disclosure must state the steps the organization has taken to ensure that slavery and human trafficking are not taking place in any of its supply chains and in any part of its own business, or that the organization has taken no such steps.
A “commercial organization” is broadly defined as a corporation or partnership that carries on a business, or part of a business, in any part of the United Kingdom. However, the disclosure obligations apply to companies with a turnover of over £36 million.
Pursuant to the UK statute, a company’s statement may include the following information:
It is important to highlight that the statute does not create an affirmative obligation to develop a compliance program to address human trafficking in the supply chain. However, companies must publicly disclose that they do not have any policies or procedures in place. Accordingly, the British government is relying on pressure from the public, as well as advocacy organizations, to encourage corporations to voluntarily adopt measures to combat slavery and human trafficking in their supply chains.
The UK’s mandatory annual reporting requirements take effect in October. The Secretary of State is expected to publish additional compliance guidance in the near future.
In the United States, California is currently the only state to require businesses to disclose the steps they are taking to combat slavery and human trafficking. However, federal legislation could be on the horizon.
Last month, U.S. Representatives Carolyn Maloney (D-NY) and Chris Smith (R-NJ) introduced the Business Supply Chain Transparency on Trafficking and Slavery Act of 2015 (H.R. 3226), which would require publicly traded companies with over $100 million in annual worldwide gross receipts to disclose their policies on human trafficking, slavery, and forced labor on their websites as well as in annual reports filed with the Securities and Exchange Commission (SEC).
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