By Paul Vieira


OTTAWA--A Canadian watchdog concluded that forced labor was used at a Chinese mine controlled by Vancouver, British Columbia-based Dynasty Gold, and is calling on the country's trade minister to slap penalties against the company.

The Canada Ombudsperson for Responsible Enterprise's conclusion and advice is in a report following an investigation, which took place after 28 Canadian organizations filed complaints alleging human-rights abuses at the Hatu gold mine in China's Xinjiang region. Dynasty holds a majority ownership stake in the mine, through a subsidiary, the watchdog said.

"There is clear evidence that Uyghur forced labor was used at the Hatu gold mine," the ombudsperson, Sheri Meyerhoffer, said. "Like all Canadian companies operating outside Canada, Dynasty has a responsibility to respect human rights. In this case, Dynasty failed to operate responsibly."

Meyerhoffer said Dynasty and its senior officers declined to participate in her office's investigation. Dynasty President and Chief Executive Ivy Chong didn't immediately respond to a request for comment.

In a statement issued last August, Chong refuted allegations contained in a draft report the watchdog prepared that was reported on by local media. Chong said Dynasty has had a "mostly passive role" in the joint venture, through its subsidiary. Further, Chong said the joint venture provided on-the-job training to local workers and paid a high level of wages relative to the region's economy.

The "allegations are not supported by the evidence and are unfounded," Chong said in August.

The report recommends that Canada's trade minister, Mary Ng, ban Dynasty from benefiting from government trade advocacy, and ban Dynasty from receiving financial support from the country's export-credit agency. Those penalties should remain until Dynasty takes a series of measures, such as a large financial donation to help combat Uyghur forced labor, and the implementation of policies prohibiting forced labor at the Hatu gold mine.

A representative for Ng didn't immediately respond to a request for comment.

Members of Congress are pressing the Biden administration to do more to enforce the U.S.'s Uyghur Forced Labor Prevention Act, a 2022 law that blocks the import of goods tied to forced labor in China's Xinjiang region. China has repeatedly denied perpetrating human rights abuses in Xinjiang and has said the U.S. is using human rights as a pretext to engage in economic coercion.


Write to Paul Vieira at paul.vieira@wsj.com


(END) Dow Jones Newswires

03-26-24 1256ET