Information made available by U.S. Customs and Border Protection highlights an evolving environment with respect to the agency’s enforcement of the Uyghur Forced Labor Prevention Act.
The UFLPA establishes a rebuttable presumption that goods made wholly or in part in China’s Xinjiang Uyghur Autonomous Region are made with forced labor and are therefore excluded from entry into the U.S. All businesses with products whose supply chains include Chinese materials should understand both CBP’s importer guidance and the related enforcement strategy and ensure that they are being implemented into their business operations. Even companies not importing directly from China may have goods detained if the materials used to produce those goods in a second country are tied at any level to the XUAR or specific entities or commodities associated with forced labor in China.
In its updated dashboard CBP provides aggregate statistics on the number and value of shipments stopped for UFLPA enforcement as well as the industries and countries of origin most affected. Highlights of the most recent statistics include the following.
- The number of stopped shipments increased from 938 in the first quarter of FY 2023 to 1,120 in the second quarter. However, the value of such shipments increased only slightly, from $303.4 million to $304.9 million.
- Of the 3,588 total shipments stopped since CBP began enforcing the UFLPA, 1,323 (37 percent) have been released, 490 (14 percent) have been denied, and 1,778 (50 percent) are still pending. Those figures are 24 percent, 8 percent, and 67 percent for the second quarter of FY 2023.
- Overall, electronics has been the industry sector accounting for the highest percentage of stopped shipments (48.9 percent), followed by apparel, footwear, and textiles (18.9 percent) and industrial and manufacturing materials (14.2 percent). In the most recent quarter the leading sectors were industrial and manufacturing materials (33.0 percent), electronics (29.8 percent), and apparel, footwear, and textiles (16.3 percent).
- More than half the value of all stopped shipments to date (53.5 percent) has come from imports from Malaysia, followed by 35.4 percent from Vietnam and 10.2 percent from China. In the most recent quarter those figures were 57.5 percent for Malaysia, 24.5 percent for Vietnam, and 17.8 percent for China.
- To date China has accounted for the largest percentage of stopped shipments at 36.2 percent, followed by Vietnam at 33.5 percent and Malaysia at 29.0 percent. For the most recent quarter those figures are 41.2 percent for China, 36.0 percent for Vietnam, and 21.9 percent for Malaysia.
- All of the stopped shipments to date from Malaysia have been in the electronics sector. For Vietnam, 56.2 percent have been in electronics, 22.1 percent have been in apparel, footwear, and textiles, and 21.6 percent have been in industrial and manufacturing materials. For China, 29.6 percent have been in apparel, footwear, and textiles, 19.2 percent have been in industrial and manufacturing materials, and 16.9 percent have been in agriculture and prepared products.
Sandler, Travis & Rosenberg has a robust program to assist companies on forced labor issues. ST&R also maintains a frequently updated web page offering a broad range of information on forced labor-related efforts in the U.S. and around the world. For more information, please contact ST&R at supplychainvisibility@strtrade.com.
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