Canada is eliminating a watchdog that investigates alleged human rights violations committed by Canadian companies operating abroad, after Mark Carney said the office hadn’t been “effective” since it was set up in 2019.

The move comes as Canada faces criticism from Donald Trump’s administration over its “unacceptable” efforts to combat forced labour.

The Canadian Ombudsperson for Responsible Enterprise (Core) was established by former prime minister Justin Trudeau’s government to investigate the use of forced labour by industry. At the time, much of the focus was on China’s use of the Uyghur ethnic minority for what critics say was forced labour. Despite years of public reports from human rights groups, Beijing disputes claims it engages in modern day slavery.

Over its six years, however, Canada’s watchdog has only launched five investigations, including against three US clothing companies with operations in the country – Ralph Lauren, Nike and Levi Strauss – as well as two mining companies: GobiMin and Dynasty Gold Corp.

In all cases, the allegations centered on the use of forced labour in the northeastern Xinjiang region of China. The watchdog also used its mediation mechanism after Hugo Boss faced allegations that it used Uyghur forced labour. Core has only issued formal recommendations against two companies.

As part of his austerity measures, Carney has said the Liberals will review the function of various offices in the federal government and will make cuts where resources are used inefficiently.

“Part of government is to look at things and see whether or not they’re effective and try to improve it,” he said, adding the decision to cut the role was taken “a few months ago”. He said that while Canada has formal legislation to combat the issue, including the Fighting Against Forced Labour and Child Labour in Supply Chains Act, it has been “less effective” in enforcing those laws.

Despite criticisms of the watchdog, federal ministers have called it an important part of Canada’s efforts to combat human rights violations. When touring China in the spring as part of a trade mission, Canada’s finance minister François-Philippe Champagne cited Core as a safeguard against the use of forced labour in Chinese automobiles that might one day be sold in Canada.

Other lawmakers say the oversight body needs resources, not elimination.

“CORE has never been given the independence or powers it needs to do its job properly,” said Green party leader Elizabeth May said in a statement. “The Green Party has long called for this office to be strengthened so it can actually investigate abuses, compel evidence and deliver accountability. The solution to a flawed office cannot be to simply do away with it entirely.”

The Liberals said on Friday that new legislation would create a public list of products that have been linked to forced labour in specific regions and would require importers to prove that specific products from listed regions were not made through slavery.

The move comes as the US has called out Canada – and 80 other nations – over their perceived inability to tackle the use of forced labour in supply chains.

The White House recently announced it would impose tariffs on Canada for what it suggested were weak enforcement rules around goods made with forced labour. The Liberals say their new legislation should address the issues raised by the Trump administration.