The US executive and legislative branches are ratcheting up pressure on companies to address forced labor in their supply chains. The US Department of Homeland Security’s Customs and Border Protection agency (CBP) has in recent months announced a series of Withhold Release Orders (WROs) and a Finding following investigations into forced labor. Additionally, the US House of Representatives has passed two bills that together would impose import bans, sanctions, and strict reporting requirements on activities related to allegations of forced labor and China’s Xinjiang Uyghur Autonomous Region (XUAR).
These actions are in addition to the export controls and sanctions restrictions that have been implemented to target the Xinjiang Production and Construction Corps (XPCC) and other entities in the XUAR. The European Union, United Kingdom, and Canada are considering similar actions; and industry groups are increasingly cautioning companies against sourcing products from areas implicated by forced labor.
Based on the scope and scale of these activities, companies should review their compliance programs to see how they address forced labor and human rights issues in their supply chains. Recent Steptoe posts provide additional background concerning the current US government-wide approach regarding allegations of forced labor in XUAR, including sanctions, export controls, and WROs.
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