On 30 June 2026, the UK government introduced the Immigration and Asylum Bill (the Bill), proposing the most significant reforms to the Modern Slavery Act 2015 (the MSA) since its enactment. The MSA’s transparency-in-supply-chains regime relies on voluntary disclosure is subject to very limited enforcement; the Bill would move the regime towards mandatory reporting, stronger corporate accountability and material sanctions for non-compliance.
Current regime
Under the current version of the MSA, organisations carrying on business in the UK, with annual turnover of at least £36 million, must publish an annual slavery and human trafficking statement describing the steps they have taken to address modern slavery risks in their business and supply chains. There is detailed statutory guidance indicating the kinds of things that ought to be included. However, strictly-speaking there is no mandatory content beyond stating what steps have been taken during the financial year to ensure that slavery and human trafficking is not taking place in an organisation’s supply chains, and in any part of its own business, alternatively a statement that the organisation has taken no such steps. The MSA does not set out financial penalties for non-compliance, with the requirement to publish a statement being enforceable only via a civil injunction.
Key changes
As currently drafted, the Bill will substantially change that position. Key changes include:
- Mandatory reporting content (clause 44 and Schedule 5, inserting new Schedule 4ZA into the MSA): The current non-exhaustive list of matters that organisations may address in their statements will be replaced with mandatory reporting requirements. Statements will need to cover the organisation’s structure, operations and supply chains. They will also need to specify areas of its operations that present a risk of slavery or trafficking; risk assessment and mitigation measures; policies and due diligence processes; training programmes; and an assessment of the effectiveness of actions taken. Where no steps have been taken in a particular area, organisations will need to explain why. One notable aspect in this part of the Bill is a requirement to report on training about slavery and human trafficking made available to the “staff of the relevant entity’s supply chains”, which implies an obligation to check on the training received by the employees of vendors. Whereas previously, this might have been a step that organisations took as part of their due diligence, it will now be mandatory, albeit qualified by the words “…so far as information about such training is reasonably available.”
- Publication and submission requirements (clause 47, inserting new section 54ZB): The Bill introduces additional procedural requirements relating to the publication and submission of statements. This includes a requirement to include link to the statement in a “prominent place” on the company’s website.
- Financial penalties for non-compliance (clause 49, inserting new section 54ZD): For the first time, the regime will be backed by financial penalties. The Bill gives a power to make regulations which may provide for penalties where an organisation or public authority fails, without reasonable excuse, to comply with its reporting obligations. The maximum penalty cannot exceed the greater of £1 million or 1% of total turnover. Only one penalty may be imposed in respect of a statement for a particular financial year.
Forced labour reforms in the EU
These reforms arrive against a broader backdrop of increasing international focus on forced labour and supply chain due diligence. In particular, businesses operating in Europe are preparing for the application of the EU Forced Labour Regulation from December 2027, which will prohibit products made with forced labour from being placed on or exported from the EU market. While the EU regime takes a different approach, and focuses on product bans rather than reporting obligations, both frameworks reflect growing regulatory expectations around supply chain transparency and human rights risk management.
Companies already working towards compliance with the EU changes should consider whether that evidence base can also support compliance with the UK’s new Schedule 4ZA content requirements (should it come into force), rather than setting up parallel workstreams.
Looking forward
Although the Bill remains subject to the parliamentary process and has not yet come into effect, the proposals signal a shift in policy direction towards more elaborate mandatory requirements and stricter enforcement. Organisations that currently fall within the scope of the MSA should start to consider existing statements, due diligence procedures and governance arrangements in the light of the changes anticipated under the Bill. Many organisations do align their statements with existing statutory guidance, which may mean that the statements they are used to producing are already compliant or close-to-compliant. Nonetheless, the new mandatory requirements are likely to be more onerous in some respects and, depending on the ultimate text of the legislation regarding penalties, the risks of non-compliance are likely to be significantly greater.
Arnold & Porter’s European Life Sciences team has assisted a number of companies with compliance queries around the UK Modern Slavery Act and continues to monitor developments with this legislation. If you have questions or wish to discuss the upcoming amendments, please do not hesitate to reach out to Tom Fox or Heba Jalil.
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