Background

Importers of goods from China being scrutinized for a possible connection to forced labor face continued uncertainty due to a possible legislative debate on how to strengthen existing laws. In the meantime, however, ST&R’s experienced professionals are providing guidance to importers on how to prevent the use of forced labor in their supply chains. For more information, please contact Elise Shibles, Amanda Levitt, or Nicole Bivens Collinson.

Two different versions of legislation to further crack down on imports of goods made in China’s Xinjiang Uyghur Autonomous Region with the use of forced labor have recently been introduced in Congress. However, there are significant differences in the ways each bill would approach this issue. For example, ST&R’s Amanda Levitt notes, in contrast to the House bill (H.R. 1155), the Senate version (S. 65) proposes a more collaborative approach with the trade community to identify and eradicate forced labor, particularly recognizing the corporate social responsibility programs companies have and can put in place. Other notable differences include the following.

- The Senate bill would require a holistic government effort to develop a strategy for preventing imports of goods made in the XUAR with forced labor and produce a report that (1) includes guidance to importers on best practices, effective due diligence measures, and types of evidence that prove goods were not made with forced labor, (2) outlines efforts, initiatives, tools, and technologies CBP can adopt for more accurate identification and tracing of XUAR-origin goods, and (3) specifies how CBP can enhance existing tools for effective enforcement, including pilot programs to test technologies when examining goods.

- The Senate bill would provide more ways for goods to be admitted to the U.S., including a due diligence-based option where the importer of record must have fully complied with the report’s guidance and completely and substantively responded to all CBP inquiries. The House bill would only allow entry if there is clear and convincing evidence that the goods were not made with forced labor.

- The Senate bill would direct the development of a plan for working with private-sector entities seeking to conduct supply chain due diligence to prevent the importation of goods made with forced labor.

- Under the Senate bill, the federal government would solicit public comments on how to best to ensure that goods made with forced labor in China do not enter the U.S.

- The House bill would add polysilicon, which is used to make solar cells and other goods and of which the XUAR is a major source, to its high-priority list.

- The Senate bill proposes a longer time frame for implementation (300 days vs. 120 days).

In addition, Levitt said, both bills expand the range of oppressed persons, targeted products, and covered areas in China beyond those provided in similar legislation approved by the House in September 2020. For example, the scope of the prohibition could extend past the boundaries of the XUAR as it could apply to products mined, produced, or manufactured by persons working with the XUAR government or the Xinjiang Production and Construction Corps. 

Nicole Bivens Collinson, president of ST&R’s international trade and government relations practice, said the significant differences between the House and Senate bills likely mean that it will take time for lawmakers to resolve those differences and approve a final bill. This delay could also mean delays in CBP publishing new guidance on what it will require to substantiate claims that goods are not made with forced labor.

Copyright © 2021 Sandler, Travis & Rosenberg, P.A.; WorldTrade Interactive, Inc. All rights reserved.

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