Background

Companies in all industries are being encouraged to conduct reviews of their supply chains as international scrutiny of the use of forced labor intensifies. Sandler, Travis & Rosenberg offers a comprehensive suite of services to help companies address forced labor concerns, including supply chain reviews, due diligence strategies, and proactive remediation. For more information, please contact Amanda Levitt (at (212) 549-0148) or via email), David Olave (at (202) 730-4960 or via email), or Nicole Bivens Collinson (at (202) 730-4956 or via email).

The United Nations Human Rights Council recently sent letters to a range of international companies about the potential use of forced labor in China. These companies, which include “well-known global brands,” are located in the U.S., China, Canada, the United Kingdom, Switzerland, Sweden, Spain, South Korea, Japan, Italy, Germany, France, Finland, and Denmark.

According to the letters, the UNHCR has received information that these companies may be involved through their supply chains in alleged forced labor, arbitrary detention, and trafficking in Uyghurs and other minority workers within and outside China’s Xinjiang Uyghur Autonomous Region. These workers are predominantly employed in low-skilled, labor-intensive industries such as agribusiness, textiles and apparel, automotive, and technology.

The council said it has also received information regarding multinational corporations sourcing items from factories in China, including in Xinjiang, not being allowed to freely access those factories in order to exercise adequate oversight and human rights due diligence. 

Stating that it does not wish to “prejudge the accuracy of these allegations,” the council is seeking further information from each company on a number of issues, including the following.

- whether the company has taken due diligence steps to identify, prevent, mitigate, and account for human rights abuses caused by or contributed to through their activities or directly linked to their operations, products, or services

- monitoring and evaluation systems the company has in place to ensure the effectiveness of its due diligence steps, including cascading requirements that reach down to suppliers

- steps the company has taken to exercise leverage in its business relationships to prevent and mitigate human rights abuses committed by businesses employing Uyghur and other minority workers

- steps the company has taken or is considering to avoid potential complicity in alleged business-related human rights abuses

The council said it will be issuing a press release within 60 days highlighting its concerns about the use of forced labor in China and that this press release will indicate that the council has been in contact with the companies receiving the letter.

In addition, other nations are joining the U.S. in focusing on goods made with forced labor and China’s treatment of the Uyghur and other ethnic and religious minorities. For example, on March 22 the European Union, the United Kingdom, and Canada announced sanctions on four individuals and the Xinjiang Uyghur Autonomous Region. 

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