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The US Forced Labor Enforcement Task Force Seeks Public Comment on Implementation of Uyghur Forced Labor Prevention Act2월 1, 2022
The US Department of Homeland Security, on behalf of the Forced Labor Enforcement Task Force (“Task Force”), has published in the Federal Register a request for public comment regarding the creation of an enforcement strategy for the Uyghur Forced Labor Prevention Act (“Act”). Comments are due by March 10, 2022. The Act has the potential to create significant logistical challenges for those who import from China.
Signed into law by President Biden on December 23, 2021, the Act creates a rebuttable presumption (effective June 21, 2022) that all goods produced, wholly or in part, in the Xinjiang Uyghur Autonomous Region (“Xinjiang Region”) of China are made with forced labor and, thus, are not entitled to entry into the commerce of the United States. The Act extends this presumption to entities located outside of the Xinjiang Region if it is determined that those entities are part of certain Chinese government labor schemes, including so-called “pairing assistance” or “poverty alleviation” programs, that include the forced labor of Uyghurs, Kazakhs, Kyrgyz, Tibetans, and members of other persecuted groups.
The Act grants the US Customs and Border Protection (“CBP”) Commissioner (“Commissioner”) the authority to issue implementing regulations, including related to the amendment of other regulations relating to Withhold Release Orders (“WRO”), but so far none have been issued pursuant to the Act.
Until the enforcement strategy is formalized and more detailed implementing regulations are issued under the Act, the law remains unclear on a number of important diligence questions relevant to international importers with complex supply chains, including supply chain tracing requirements.
Background on Uyghur Forced Labor Prevention Act
As discussed in our previous alert, The Biden Administration Ends the Year with Several National Security-Driven Measures Targeting China, the Act presumptively denies imports into the United States of all goods, wares, articles, and merchandise mined, produced, or manufactured wholly or in part in the Xinjiang Region. To assist importers with compliance, the Act calls for the issuance of guidance specifically related to:
- due diligence, effective supply chain tracing, and supply chain management measures to ensure that such importers do not import any goods mined, produced, or manufactured wholly or in part with forced labor from China, especially from the Xinjiang Region;
- the type, nature, and extent of evidence that demonstrates that goods originating in China were not mined, produced, or manufactured wholly or in part in the Xinjiang Region; and
- the type, nature, and extent of evidence that demonstrates that goods originating in China, including goods detained or seized pursuant to section 307 of the Tariff Act of 1930 (19 U.S.C. 1307), were not mined, produced, or manufactured wholly or in part with forced labor.
To this end, the Act requires the Task Force create a formal strategy for ensuring compliance and supporting enforcement of the law. The Task Force is taking initial steps towards creating a formal strategy through the notice and comment process. As part of this process, the Task Force provided the public with eighteen questions it has identified as relevant to enforcement and compliance, including topics such as:
- The conditions that could lead to the importation into the United States (including through third countries) of goods, wares, articles and merchandise mined, produced, or manufactured wholly or in part with forced labor;
- Due diligence strategies such as effective supply chain tracing;
- What evidence can demonstrate that Chinese goods do not fall within the scope of the Act;
- How the broad scheme of forced labor in China functions, for example, through “pairing assistance” and “poverty alleviation” or other government labor schemes that include the forced labor of Uyghurs, Kazakhs, Kyrgyz, Tibetans, or members of other persecuted groups outside of the Xinjiang Region; and
- Which goods are products of forced labor either in Xinjiang or other areas where entities work with the government of Xinjiang to recruit, transport, transfer, harbor, or receive forced labor.
Public comments in response to these and other related questions are due to the Task Force by March 10, 2022, following which the Task Force is required to conduct a public hearing on the Act’s enforcement strategy no later than April 24, 2022. Thereafter, no later than June 21, 2022, the Task Force must submit an initial report to Congress on the strategy for preventing the importation into the United States of goods, wares, articles and merchandise mined, produced, or manufactured wholly or in part with forced labor in the People's Republic of China.
Until this strategy is formalized and more detailed implementing regulations are issued under the Act, the law is unclear on what level of diligence is required of importers. CBP guidance related to similar, more established, but separate legal regimes that prohibit the importation into the United States of products made from forced labor may be relevant. Specifically, existing WRO’s related to the Xinjiang Region, which are applied against cotton and tomatoes and their downstream products (e.g., apparel, textiles, tomato seeds, canned tomatoes), provide insight into the information CBP considers when determining whether to block entry of certain products or permit entry over a presumption of denial. This information includes submission of a Certificate of Origin signed by the foreign seller as required by 19 C.F.R. § 12.43(a) and a detailed statement, as outlined in 19 C.F.R. §12.43(b), from the importer with proof that goods were not produced, wholly or in part, with forced labor. Under existing WRO’s related to the Xinjiang Region, supporting documentation should trace the supply chain from the origin, to the production and processing of downstream products, to merchandise imported into the United States.
O’Melveny recognizes law clerk Dillon Roseen for his valuable contribution in researching and drafting this article.
This memorandum is a summary for general information and discussion only and may be considered an advertisement for certain purposes. It is not a full analysis of the matters presented, may not be relied upon as legal advice, and does not purport to represent the views of our clients or the Firm. Greta Lichtenbaum, an O’Melveny partner licensed to practice law in the District of Columbia, David J. Ribner, an O’Melveny counsel licensed to practice law in the District of Columbia and New York, and Dillon Roseen, an O’Melveny law clerk, contributed to the content of this newsletter. The views expressed in this newsletter are the views of the authors except as otherwise noted.
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