Background

U.S. Customs and Border Protection saw a decline in forced labor enforcement actions in September even as CBP Commissioner Chris Magnus praised the agency’s efforts.

The Uyghur Forced Labor Prevention Act establishes a rebuttable presumption that goods made wholly or in part in China’s Xinjiang Uyghur Autonomous Region are made with forced labor and 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.

CBP recently began reporting on UFLPA- and other forced labor-related enforcement actions in its monthly operational update. CBP states that in September it targeted 491 entries (down from 838 in August) valued at more than $158.6 million (down from $266.5 million) for suspected use of forced labor in the production of imported goods, including goods subject to the UFLPA and withhold release orders. Elise Shibles, who heads ST&R’s forced labor practice, said that according to CBP targeted shipments include those that are further inspected but not detained, detained and released, detained and exported, or detained and abandoned.

Shibles said the monthly decline in enforcement numbers could be attributable to a number of factors. For example, seasonal shipping patterns for certain types of goods could have meant fewer shipments. In addition, targeted entities that are subsequently identified in a detention will often halt shipments to the U.S. to avoid shipping and storage charges for goods that may experience significant delays in CBP clearance.

According to a Bloomberg News article, Commissioner Magnus said importer compliance with the UFLPA could be another reason for the decline. “There are going to be some rough spots along the way, but I think we’ve been off to a remarkably good start,” the article quoted him as saying. “We’re seeing good examples of compliance so far.”

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.

Click here to register for ST&R’s upcoming webinar on global trade restrictions to address forced labor.

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