Source: Blog – Alliance for American Manufacturing
Vessels and cranes at the Port of Oakland container terminal in Oakland, California. Getty Images
The sponsors of the original legislation want more transparency — and they are also worried that prominent Chinese companies like SHEIN and Temu are getting around the import ban.
It’s been about 10 months since the Uyghur Forced Labor Prevention Act (UFLPA) officially went into effect, banning all imports from the Xinjiang region of China unless importers can produce “clear and convincing evidence” that their products aren’t made with forced labor.
There are some early signs that the law is working, with U.S. Customs and Border Protection (CFB) recently unveiling a new dashboard showing imports from the region are down. But products likely made with forced labor in Xinjiang are still reaching U.S. shores — and now the lawmakers behind the original legislation are aiming to better enforce the law.
Rep. Christopher Smith (R-N.J.) and Sen. Jeff Merkley (D-Ore.) — the chair and cochair of the Congressional-Executive Commission on China — joined with Sen. Marco Rubio (R-Fla.) and Rep. James McGovern (D-Mass.) to write to Department of Homeland Security Under Secretary Robert P. Silvers on Tuesday with concerns about UFLPA’s implementation and enforcement.
The bipartisan group raised concerns about oversight of the new law, writing that “Congress lacks sufficient information and transparency to accurately assess whether implementation of the law comports with congressional intent.” They also raised specific worries, including how uber-popular Chinese brands like SHEIN and Temu are using direct-to-consumer shipping to evade the law and the challenge of assessing imports that are made with Chinese inputs but shipped from other countries.
The lawmakers also announced that the commission will hold a hearing on April 18 “with a panel of experts on trade, forced labor, and labor trafficking to examine UFLPA implementation.”
The Xinjiang region of China is highlighted in red on the map above. China’s government stands accused of perpetrating a genocide against the Uyghur people there, which includes the use of forced labor. Getty Images
Congress passed the UFLPA nearly unanimously in response to mounting evidence that China’s government is using forced labor in Xinjiang, where it also stands accused of overseeing a genocide of the Uyghur people and other ethnic minority groups. Products made with forced labor include everything from clothing to solar panels to auto parts to even vinyl flooring. Dozens of global brands have been tied to forced labor said to be happening there.
Because forced labor is so widespread in Xinjiang, the UFLPA aims to prevent anything made in the region from reaching U.S. store shelves. And the lawmakers write that it is “making an impact, putting substantial political and economic pressure on the government of the People’s Republic of China (PRC) and forcing global corporations to investigate and disclose supply chains.”
But big challenges remain.
The lawmakers note, for example, that SHEIN and Temu are taking advantage of a loophole to not only avoid paying duties on their products that are shipped the United States, but also seemingly to dodge UFLPA enforcement. They write:
We know that de minimis shipping allows vendors to send materials without having to report basic data, such as country-of-origin and manufacturer, if they claim that the value is under $800, using Section 321 of the Tariff Act of 1930. In order to better understand how the “de minimis” rules affect the UFLPA implementation as we contemplate legislative actions to address this loophole, we request more information about how CBP enforces UFLPA with regard to “de-minimis” shipments from the [People’s Republic of China] and to report to us about how CPB intends to update the UFLPA implementation strategy to address the challenges posed by direct-to-consumer businesses such as TEMU, whose Superbowl ads signaled its efforts to expand its reach in the United States and whose app is now the one of the most downloaded in the United States. The fact that the Google Play Store recently suspended the app of TEMU’s Chinese parent company Pinduoduo (PPD)—citing security concerns about malware—only makes a concerted response to TEMU based imports all the more urgent.
In addition, the Members of Congress write that “addressing transshipment from third countries is a major challenge in implementation of the law amid global supply chains.” The lawmakers request that U.S. Customs officials report on how it “intends to address this challenge,” including “what kind of tools and technology it plans to employ, and what, if any, further resources it needs in this effort.”
The lawmakers also express additional concern that the public is not being informed when U.S. Customs stops products from entering the U.S. due to “evidence or reasonable suspicion of links” to the Xinjiang region only to be released for entry later on. And the four want more to be done to ensure entities identified as having ties to Xinjiang be included on the UFLPA’s Entity List.
We’ve followed the passage and implementation of the UFLPA closely here at the Alliance for American Manufacturing; our President Scott Paul even discussed the historic law when he testified before the new Select Committee on the CCP a little more than a month ago.
Implementation of the new law always was going to be a challenge, as so much of the world’s manufacturing and supply chains runs through Xinjiang. This undermines American manufacturers, of course, who find themselves unfairly competing against companies willing to use modern-day slaves to make their goods.
But more importantly, America’s continued consumption of goods made via human exploitation should not continue. Congress was right to pass this law, and U.S. Customs officials must do everything they can to enforce it. In the meantime, lawmakers would be wise to get to work on closing the de minimis loophole that has allowed SHEIN, Temu, and others to dodge the law altogether.
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