Import and export restrictions, trade policy changes, and other measures are part of a national action plan recently issued by the Biden administration to promote responsible business conduct and due diligence.
According to the plan, the U.S. government expects all businesses to conduct human rights due diligence throughout their value chains in line with internationally-recognized standards, to make HRDD an integral part of their decision-making, and to embed HRDD into their existing risk management systems. Businesses should also implement sector-specific standards that provide credible metrics that meaningfully measure progress on the impact of businesses on people across value chains. All businesses should conduct HRDD regardless of their size, sector, operational context, ownership, or structure, the plan states, although the scale and complexity or the means they use may vary. Details on what constitutes HRDD can be found in the plan.
The plan also sets forth the measures federal agencies plan to take to help businesses with their HRDD efforts, noting that while the private sector has increased the quantity and quality of its due diligence in recent years, “value chain opacity, traceability challenges, lack of guidance from governments, conflict, and weak rule of law in many of the countries where businesses operate all make it difficult for businesses to carry out effective due diligence.” While some of these measures aim to incentivize responsible business conduct, others are more punitive in nature. Highlights include the following.
- U.S. Customs and Border Protection and Homeland Security Investigations will improve information sharing with the aim of increasing the number of withhold release orders and findings as well as criminal investigations into allegations of forced labor.
- CBP will draft guidance to direct the proactive consideration, on a case-by-case basis, of suspension and debarment (which restricts federal agencies from doing business with named entities) whenever CBP issues (1) a penalty for repeated violations of 19 USC 1307 (regarding imports of goods made with forced labor) or related laws or (2) WROs or findings against entities or individuals.
- The State Department, in coordination with other agencies, will deploy export controls, economic sanctions, visa restrictions, and other tools to promote accountability for business and human rights-related abuses.
- State will also further implementation of the Export Controls and Human Rights Initiative Code of Conduct.
- The Office of the U.S. Trade Representative will (1) conduct an interagency review of existing trade policies and tools used to combat forced labor to identify areas that may need to be strengthened or gaps that may need to be filled and (2) use this review to establish objectives, priorities, new tools, and key action items to advance the development of a forced labor trade strategy.
- The Department of Homeland Security will convene biannual stakeholder engagements on the implementation of the Uyghur Forced Labor Prevention Act strategy to “enhance its ability to be responsive to external stakeholder input.”
- The Department of Labor will map its list of goods produced by child or forced labor to product service codes and country information to increase use of the list by the federal acquisition workforce.
- The DOL will fund a project to improve the implementation of worker-driven social compliance systems (piloted in the Indonesian palm oil sector) that promote fundamental labor rights and acceptable conditions of work, including the elimination of forced labor, in supply chains.
- The DOL will develop an online central repository of federal agency guidance, tools, and resources to facilitate and incentivize the adoption of effective corporate accountability models and practices relevant to labor rights outcomes in business supply chains.
- The Department of Health and Human Services will work with others to develop and make available a suite of sector-specific tools (e.g., online training, recommendations, model policies, and a resource portal) to prevent forced labor, human trafficking, and related practices in the supply chains of U.S. health systems and public health institutions.
- State will lead federal efforts to develop new guidance beyond labor rights, such as due diligence guidance for investors considering investments in technologies that could enable or exacerbate human rights abuses and business advisories for companies, investors, and other stakeholders that do business in or engage in transactions involving specific countries, regions, or sectors with heightened human rights risk.
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