In advance of the Uyghur Forced Labor Prevention Act ("the Act") taking effect on June 21, 2022, U.S. Customs and Border Protection ("CBP") announced it would be issuing letters to importers ("known importer letters") identified as having previously imported merchandise that may be subject to the Act to give them the opportunity to address any forced labor issues in their supply chain.
The Act establishes a rebuttable presumption that any goods, wares, articles and merchandise mined, produced, or manufactured wholly or in part in the Xinjiang Uyghur Autonomous Region ("XUAR") of China, or by certain other entities, is the product of forced labor as defined in Section 307 of the Tariff Act of 1930 (19 U.S.C. 1307), and thus not entitled to entry into the United States. This presumption can only be overcome by a showing of "clear and convincing evidence" that any specific item was not produced with forced labor.
Importantly, if an importer does not receive a letter from CBP it does not mean that the importer's supply chain is free of forced labor or that that importer is free from potential liability. CBP notes that all importers are expected to review their supply chains and implement measures to ensure imported goods are not produced wholly or in part with convict labor, forced labor, and/or indentured labor (including forced or indentured child labor).
Whether you have received a letter or not, a proactive approach to this issue is the best approach. An internal compliance program can help your employees identify the indicators of forced labor. Review your supply chain: know where each component originates and who is involved and examine each segment of your supply chain to identify any forced labor involvement. Educate your suppliers and, if not doing so already, include language prohibiting forced in contracts with business partners. Create an audit trail and retain all records. And, lastly, stay up to date on any CBP guidance published between now and the June 21, when the Act and the rebuttable presumption go live.
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