Congress stands poised to dramatically change a key legal tool in the fight against human trafficking. Although the name of the law itself focuses on the Uyghur community who are forced to work in Xinjiang, China, it could have global implications.
Blocking imports of tainted goods
Currently, a 90-year-old law allows Customs and Border Protection (CBP) to issue a Withhold Release Order (WRO) that blocks the importation of goods made by forced laborers abroad.
The purpose is to protect American customers from unwittingly purchasing products that enrich traffickers. It is also an attempt to apply pressure through the chain of commercial transactions to discourage, and hopefully, stop traffickers.
Over the last five years, CBP has significantly increased the number and scope of WROs, creating new incentives for businesses to ensure their supply chains are free of forced labor. There has been rare bipartisan support for using these import laws to advance the United States’ human rights priorities on the global stage. Presidents Obama, Trump and Biden have all elevated and celebrated their use.
A new presumption of forced labor
The new Uyghur Forced Labor Prevention Act (the Act) will transform the current rules about what goods cannot enter the United States. The Act relieves CBP of the burden of issuing individual WROs against specific companies in Xinjiang, China by creating a presumption of forced labor throughout the region. The Act presumes that any goods from Xinjiang are made by forced laborers and therefore barred from entry. The burden is then shifted to the importers to show that their supply chains are clean. A task made more difficult by a lack of transparency or access to the Xinjiang region.
A new regulatory framework for import nans?
The rebuttable presumption of forced labor only affects the Xinjiang region, but another aspect of the act could affect all WROs for businesses around the world. In July, before the Senate unanimously passed the act, a new section was inserted into the law with broad industry support. The additional provisions require several things before the presumption can take effect. They include a 300-day delay, a period for public comment and public hearings. Additionally, they require the federal interagency to create a new cabinet-level strategy for combatting forced labor and a new process for the issuance of WROs. Some advocates see these provisions as corporate stall tactics, while others embrace the process, citing a need to improve the governance architecture around blocking imports.
A time for action
If passed by the House and signed into law, the Act will trigger several necessary actions. First, businesses already dealing with stressed supply chains will be further incentivized to ensure their products are free of forced labor. Strategic risk assessments and ethical, victim-centered remediation efforts should be pursued without delay to maintain a thriving business. Second, government officials, business leaders and other stakeholders should be preparing to build an improved regulatory framework that allows the blocking of goods made by forced laborers to be swift, fair and transparent.
Import bans are catching on
American leadership in this area is evident. Through the USMCA (the new-NAFTA), Canada and Mexico are required to ban imports of goods made by forced laborers. The UK and Australia are taking similar steps. On Sept. 14, the president of the EU Commission announced that the EU will ban all products that traffickers forced their victims to produce.
Whenever the three areas of human rights, foreign policy and international trade are braided together; the impacts can be complicated. Banning imports of goods made by forced laborers is a prime example. Traffickers’ crimes have always created misery for victims. Now, with the increased use of WROs and the potential of the act’s presumption, traffickers’ crimes also create a supply chain challenge that business leaders cannot afford to ignore.
John Cotton Richmond is a partner with Dentons and the former U.S. Ambassador-at-Large to Monitor and Combat Trafficking in Persons.