SYDNEY, July 16, 2026 (BSS/AFP) - Australia will make big companies criminally liable for modern slavery in supply chains, the nation's top lawyer said Thursday, weeks after the United States threatened trade tariffs over the issue.

Attorney General Michelle Rowland said laws would be toughened with a new criminal offence if companies with revenue over Aus$100 million ($70 million) fail to prevent modern slavery, including forced labour and debt bondage, in their supply chains outside Australia.

"Australians rightly expect that the products they buy are not made on the back of modern slavery," she said.

Australia's embassy had earlier protested the US Trade Representative listing it among 60 countries to be slapped with a 12.5 percent tariff for failing to stop the import of goods made with forced labour.

Around 4,000 Australian companies report annually on the steps they take to prevent forced labour in the supply chain, and last year Australian Federal Police investigated 280 reports of modern slavery and human trafficking, the embassy wrote.

"There is no credible evidentiary basis for a finding that Australia's lack of a US-style prohibition on the importation of goods produced with forced labour is unreasonable, or burdens or restricts US commerce," it said.

Australian Anti-Slavery Commissioner, Chris Evans, said Australia was once a world leader with its anti-slavery rules, but had fallen behind as other countries took tougher action.

Director of the Australian Human Rights Institute, Justine Nolan, told AFP the laws enacted eight years earlier were not fit for purpose, and the changes announced Thursday were significant and would force companies to take action to prevent slavery.

There was "probably some correlation" between the timing of the changes and the US government threatening tariffs, she added.

Companies that can show they took reasonable steps to prevent slavery will have a defence under the proposed new law.

Australian will also introduce civil penalties for companies not meeting existing obligations under the Modern Slavery Act.