New federal legislation is being introduced today that would allow Ottawa to formally label countries as sponsors of terrorism, opening foreign states up to lawsuits in Canadian courts.

In Ottawa, Public Safety Minister Peter Van Loan said the legislation will allow victims of terrorism to sue perpetrators and their supporters.

"It is crucial that we move forward in order to give those families a means of obtaining justice," Van Loan said Tuesday.

The Justice for Victims of Terrorism Act amends the State Immunity Act, removing immunity for states identified by the federal government as "supporters of terrorism."

Once the legislation is passed, the Tories say they'll establish a list of states deemed to be supporting terrorist entities.

"Obviously none are designated right now," Van Loan said. "There will be a process whereby the government can designate particular states to be sponsors of terrorism if the government is of the view that they are."

As an example, Van Loan said Libya would have qualified for the list at one time.

"In the past, Libya, which was a state sponsor of terrorism -- we all know about the Lockerbie air bombing that resulted in many deaths -- that would have been in the past an appropriate state to designate as a state sponsor of terrorism," he said.

"Obviously Libya has subsequently undertaken to provide compensation, they've disavowed sponsorship of terrorism and they've tried to re-enter the mainstream of countries, but in the past that would have been an example of the type of state that would have been designated."

Prime Minister Stephen Harper made reference to the new legislation during a speech Sunday to the Canadian Jewish Congress in Toronto.

Harper said the legislation sends a clear message that Canada will hold terrorists "accountable" for their crimes.

Maureen Basnicki, of the Canadian Coalition against Terror, lost her husband Ken Basnicki in the 9/11 attacks. He was on the 106th floor of the World Trade Center.

Basnicki told CTV News Channel that the bill will "help to create a proper legacy" for her husband and provide all victims of terrorism with a "sense of justice."

Meanwhile, critics say the bill may open up all kinds of legal issues as it will open up lawsuits against nations across the world through the Canadian courts.

The legislation allows lawsuits dating back to 1985, the year of the Air India Flight 182 bombing which killed 320 people.