The Uyghur Forced Labor Prevention Act explained

On December 23, 2021, The United States (U.S.) passed the Uyghur Forced Labor Prevention Act. When President Biden signed this Act into law, a ban was placed on importing goods from the Xinjiang Uyghur (XUAR) Autonomous Region in China, effective June 21, 2022. The purpose of this Act is to take action against goods made in part or entirely through forced labor entering the U.S.

This blog will discuss the following:

• Why is this Act significant to importers?
• Who does this ban impact?
• How can importers stay compliant?

Why is this Act significant? 

For U.S. importers, this Forced Labor Prevention Act for imports from China may not seem significant, but it might be for your business. Here’s why:

• Xinjiang Uyghur is not just some tiny region. To put it into a U.S. perspective, it is more than double the size of Texas.
• 20% of the global cotton supply comes from this region.
• 45% of global silicon production occurs in this region.
• Significant amounts of other goods, such as sugar, hair products, tomatoes, and more are from Xinjiang Uyghur.

Do your products contain cotton or silicon? Are you in the hair care industry? This Act may affect you.

Who does the Uyghur Forced Labor Prevention Act impact? 

This question is pretty broad because it is not as simple as “any business who imports goods of the above categories from China” or even “anyone who imports goods directly from Xinjiang Uyghur.” It is not as clear-cut as that, which is why the Act has outlined what makes goods inadmissible into the U.S. under this Act.

The Uyghur Forced Labor Prevention Act bans all goods from entering the U.S. that meet the following criteria:

• Products from organizations in the XUAR that produce goods with forced labor
• Goods from institutions working with the government of the XUAR to recruit, transport, transfer, harbor, or receive forced labor or Uyghurs, Kazakhs, Kyrgyz, or members of other persecuted groups out of the XUAR
• Products made entirely or partially by institutions outlined above
• Goods from companies that export the products described above
• Goods from organizations that source material from the XUAR region

Essentially, anyone importing goods into the U.S. whose shipments may contain items that fit any of the above criteria is affected. You may be wondering “How do I keep track of all of the goods and their whole or partial origin?”

Well, take a deep breath; nobody has it 100% figured out yet, and there is still a little transition time for those who may be affected to adjust to these trade restrictions.

Compliance with the Uyghur Forced Labor Prevention Act 

The only way for a U.S. importer to clear a shipment from China is by providing proof that the import does not meet the criteria for inadmissibility into the U.S. under the Act (i.e., has no links to Xinjiang).

If the Chinese shipment is deemed inadmissible, or the importer has failed to provide sufficient proof that it does not violate any terms of the Act, the shipment will be destroyed, abandoned, or shipped to another country that will allow it for resale.

Is there a process set in place for obtaining proof of admissibility under the Uyghur Forced Labor Prevention Act?

There is no concrete process currently in place. However, by June 21, 2022 (but likely before then), the Forced Labor Enforcement Task Force (FLETF) is required to provide instructions to U.S. importers on how to ensure that they are not importing goods produced with forced labor. As soon as the FLETF releases those instructions, they will be effective immediately.

Do not wait for this day to come; continue reading to know how to begin preparing.

Tips on staying compliant with the Act

Until the FLETF has released concrete instructions, here’s what you can do:

• Companies importing goods from China must be more aware of who their upstream suppliers are, from raw materials to whole goods.
• Importers should document the chain of custody of their goods from China (where the raw materials are sourced, where the goods are made, where they are stored, etc.)

In other words, know your suppliers and do thorough research on your supply chains in order to find any possible suppliers linked to XUAR. Fully document your findings for your imports that do not violate the Act as proof of admissibility into the U.S.

Got any ideas?

U.S. Customs and Border Protection (CBP) wants your feedback on ways to prevent the importation of forced labor goods into the country. The deadline to submit a public comment to CBP is March 10, 2022.

Recap… 

The United States has shown determination to prevent goods created wholly, or in part, by forced labor through the Uyghur Forced Labor Prevention Act. The Forced Labor Enforcement Task Force will be issuing guidance on how importers can comply by June 21, 2022, at the latest.

However, while the Act is still in transition mode, it is best for U.S. importers to begin digging into their supply chain to find any potential links to the Xinjiang Uyghur (XUAR) Autonomous Region in China.