On June 21, 2022, U.S. Customs and Border Protection ("CBP") will begin implementing the Uyghur Forced Labor Prevention Act ("UFLPA" or "Act"), a piece of legislation that strengthens the prohibition against the importation of goods made with forced labor. The UFLPA applies a rebuttable presumption that any items that are mined, manufactured, or produced, wholly or in part, in the Xinjiang Uyghur Autonomous Region (XUAR), or by entities on a yet to be created UFLPA-related entities list, are prohibited from importation into the United States. In addition, the Act requires the Forced Labor Enforcement Task Force ("FLETF") to publish a report outlining a strategy for enforcing the prohibition on the importation of goods made with forced labor in the XUAR, and requires FLETF to publish various entity lists related to the UFLPA. The FLETF is expected to publish its strategy report on the June 21 implementation date.

In advance of the implementation date, on June 13, 2022, CBP released guidance to importers regarding enforcement of the UFLPA. This alert outlines the UFLPA's core provisions and summarizes the guidance released thus far by CBP. CBP has also published sample UFLPA known importer letters, which were issued to importers identified as having previously imported merchandise that may be subject to the Act.

I. Background on the UFLPA

The central component of the Act requires CBP to apply a presumption that any item mined, produced, or manufactured, wholly or in part, in the XUAR, or by an entity on an UFLPA-related entity list, is prohibited under Section 307 of the Tariff Act of 1930, which prohibits the importation of goods made using forced labor. This presumption may be rebutted only if CBP determines:

1. that the importer has fully complied with the due diligence guidance established by FLETF;

2. that the importer has completely and substantively responded to all inquiries for information submitted by CPB to ascertain whether goods were mined, produced, or manufactured with forced labor; and

3. by clear and convincing evidence, that the items was not mined, produced, or manufactured with forced labor.

While the Act does not specify what constitutes "clear and convincing evidence," guidance on this definition will be included in FLETF's report, as will detailed guidance on what evidence will be considered by CBP in order to rebut the Act's rebuttable presumption. This clear and convincing evidence standard is comparable to the standard contained in the Countering America's Adversaries Through Sanctions Act ("CAATSA"), which requires importers to establish by clear and convincing evidence that their supply chain does not contain labor from North Korean nationals. By contrast, importers need only show "satisfactory evidence" in order to challenge the detention or exclusion of goods pursuant to a withhold release order ("WRO").

Because the Act's presumption applies to goods mined, manufactured, or produced, wholly or in part, in the XUAR, or by a designated entity, products that contain raw materials or other items mined, produced, or manufactured in the XUAR or by a designated entity would still fall within the scope of the Act, even if the XUAR-origin content was processed or incorporated into the finished good outside of the XUAR or outside of China. Compliance with the Act's prohibition thus requires importers to ensure that their entire supply chain is free of XUAR-origin content.

The FLETF report will include the following lists, which will be used to implement the UFLPA's import prohibitions:

(i) entities in the XUAR that mine, produce, or manufacture, wholly or in part, any goods, wares, articles, and merchandise with forced labor;

(ii) entities working with the government of the XUAR to recruit, transport, transfer, harbor, or receive forced labor out of the XUAR, and

(iii) products mined, produced, or manufactured, wholly or in part, by entities on the lists required by (i) and (ii)

(iv) entities that exported products described in (iii) from China into the United States, and

(v) facilities and entities that source material from XUAR or from persons working with the government of the XUAR or with the Xinjiang Production and Construction Corps ("XPCC"), which will be designated on this list.

II. UFLPA Enforcement Timeline

Under the UFLPA and pursuant to CBP's authority under 19 U.S.C. 1499 and 19 C.F.R. 151.16, CBP has five business days following the date merchandise is presented for examination to CBP to make a determination as to whether to detain the merchandise. Merchandise not released within five days will be considered detained. Within 30 days of presentation for examination, CBP will make a final determination as to whether such merchandise should be excluded, with the failure to take any action being considered an exclusion. Accordingly, importers have only 30 days following the presentation of merchandise for examination in which to provide evidence to rebut the UFLPA's presumption. This is in contrast to detentions made under a WRO, for which importers have three months to submit proof of admissibility. After a decision by CBP to exclude merchandise, importers have 180 days in which to file a protest. Additionally, CBP has the authority to seize a shipment it determines to be in violation of the UFLPA, in which case, the shipment will be referred to the Fines, Penalties and Forfeitures (FPFO) officer at the port of entry who will provide the importer a Notice of Seizure letter. Importers may request an exception to the rebuttable presumption during a detention, after an exclusion, or during the seizure process. The applicable timelines for providing evidence to rebut the UFLPA's presumption are summarized below.

  • Importers who receive a detention notice regarding their shipments may respond to the detention notice within 30 days from the date the merchandise is presented for examination to CBP.

Importers who receive an exclusion notice may file an administrative protest within 180 days of receiving the exclusion notice.

Importers who receive a seizure notice may utilize the petition process outlined in 19 C.F.R. Part 171.

While merchandise is detained or excluded, importers have the option of exporting the merchandise rather than seeking to rebut the UFLPA's rebuttable presumption. Further, it should be noted that the Act requires CBP to notify Congress if an exception is granted and, within 30 days of such notification, publicly release a report identifying the goods for which an exception was granted, as well as the evidence that was considered in granting the exception.

III. Evidence That May be Requested to Rebut the UFLPA's Presumption

CBP's recently released operational guidance outlines five categories of information that may be requested by CBP when merchandise is detained, excluded, or seized pursuant to the UFLPA. Importantly, these categories of information are not exhaustive, and CBP has noted that this list is intended to supplement, rather than replace or supersede, the forthcoming guidance from FLETF. CBP has also noted that, in reviewing requests for an exception to the Act's rebuttable presumption, it will attempt to prioritize the requests of Customs Trade Partnership Against Terrorism ("CTPAT") members in good standing. CBP has also stated that providing such documents and information in English will help facilitate its review of a request for an exception.

  • Due diligence system information
    • Documentation showing a due diligence system that includes: (i) engagement with suppliers and stakeholders to assess the forced labor risk, (ii) supply chain mapping, (iii) written supplier code of conduct forbidding the use of forced labor and addressing the risk of Chinese government labor schemes, (iv) training on forced labor risks, (v) monitoring supplier compliance with the code of conduct, (vi) remediation of any identified forced labor conditions or the termination of such supplier relationships, (vii) independent verification of the implementation and effectiveness of the due diligence system, and (viii) public reporting on the performance of the due diligence system.
  • Supply chain tracing information
    • Documentation tracing the supply chain from raw materials to the imported good. Such documentation should cover all stages of mining, production, and manufacture, and should identify the roles of all entities in the supply chain, including shippers and exporters.
    • The documentation should list all suppliers associated with each step of the production process, including contact information, and should contain affidavits from all entities involved in the production process.
  • Information on supply chain management measures
    • Internal controls to prevent or mitigate forced labor risk and remediate any identified use of forced labor. Such documents should be part of an operating or accounting system that includes audited financial statements.
  • Evidence goods were not mined, produced, or manufactured, wholly or in part, in the Xinjiang Uyghur Autonomous Region
    • This category overlaps with supply chain tracing information, and includes all documentation that traces the supply chain for the goods and shows that the each process in the supply chain occurs outside of the XUAR.
  • Evidence that goods originating in China were not mined, produced, or manufactured, wholly or in part, by forced labor

Such evidence can include (i) a supply chain map identifying all entities involved in the production of the goods, (ii) information on workers at each entity involved in the production process in China, including wage payment and per worker production output figures, (iii) information on worker recruitment and internal controls to ensure that all workers in China were recruited and are working voluntarily, and (iv) credible audits to identify forced labor indicators

While the above categories of information apply to all importers, the State Department has previously identified a variety of industries in which the use of forced labor in the XUAR has been reported, including:

  • Agriculture
  • Cell phones 
  • Cleaning supplies
  • Construction
  • Cotton
  • Electronics assembly
  • Extractives (including coal, copper, hydrocarbons, oil, uranium, and zinc)
  • Fake hair and human wigs
  • Footwear
  • Gloves 
  • Hospitality services
  • Metallurgical grade silicon
  • Noodles
  • Printing products
  • Renewable energy
  • Stevia
  • Sugar
  • Textiles
  • Toys

IV. Preparing for Enforcement of the UFLPA

Pending additional guidance from FLETF and CBP, importers should begin preparing for enforcement of the UFLPA. While no single compliance step is likely to be sufficient to discharge an importer's due diligence obligations, importers should consider the following compliance measures:

  • Develop and implement a compliance policy and supplier code of conduct. A robust compliance program should include training for all relevant personal and annual audits of the program. Consider requiring supplier certifications as part of the supplier code of conduct.
  • Review the entire supply chain and collect documentation on all upstream suppliers in order to assess and address the risk of forced labor, and remediate any known or suspected instances of forced labor within the supply chain. Importers should identify and prioritize high-risk products or industries.
  • Begin supply chain tracing or mapping, and collect relevant documentation, including purchase orders, invoices for all suppliers and sub-suppliers, certificates of origins, bills of lading, shipping records, invoices, wage documentation, and third-party certifications.
  • Work with independent third-party auditors to conduct supply chain audits and identify any forced labor indicators.

V. Key Takeaways

The UFLPA is a first-of-its-kind effort to prevent the importation of goods made using forced labor in the XUAR. The Act's broad prohibition will likely affect importers in a wide range of industries, including electronics, renewable energy, textiles, and agriculture. While additional guidance is still forthcoming, the guidance published by CBP to date suggests that importers should review their supply chains and compliance practices even if they do not have any primary suppliers located in the XUAR or China. Importers in high-risk industries should consider proactively developing and implementing a supplier due diligence system and supply chain tracing in order to effectively identify and address any forced labor risk in their supply chain.