Background

U.S. Customs and Border Protection is advising importers of a forthcoming ban on imports of all goods made in whole or in part from any good from the Xinjiang Uyghur Autonomous Region in China and warning them that noncompliance may result in enforcement actions.

The Uyghur Forced Labor Prevention Act effectively deems all goods mined, produced, or manufactured in the XUAR to be produced by forced labor in China. Under this law, imports of such goods will be banned effective June 21 unless CBP determines that (1) the importer of record has fully complied with relevant guidance (which CBP has yet plans to issue next month) and any regulations issued to implement that guidance, (2) the importer has completely and substantively responded to all inquiries for information submitted by CBP to ascertain whether the goods were made wholly or in part with forced labor, and (3) by clear and convincing evidence, the goods were not made wholly or in part by forced labor.

Under the UFLPA 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.

CBP has now begun issuing letters notifying importers identified as having previously imported goods that may be subject to this law that “any future entries of such merchandise may be subject to CBP enforcement action, including seizure, forfeiture and/or penalties, or other appropriate action under the customs laws.” Importers that are members of the Customs Trade Partnership Against Terrorism could also be suspended or removed from that program. CBP states that it will take into consideration the fact that an importer has been provided this notice in determining appropriate administrative remedies as part of any future enforcement actions.

The letters are therefore urging importers to be proactive and closely review their supply chains to ensure that any goods or materials are not sourced from the XUAR in violation of the UFLPA. It is incumbent upon importers to “apply due diligence, effective supply chain tracing, and supply chain management measures,” the letters state, “to ensure that such imports are free from any goods mined, produced, or manufactured wholly or in part with forced labor from the People’s Republic of China, especially from the XUAR.”

Sandler, Travis & Rosenberg offers a comprehensive suite of services to help companies address forced labor concerns in China and elsewhere, including supply chain reviews, due diligence strategies, and proactive remediation. 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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