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New CBP Enforcement Initiative Targets Goods Made with Forced Labour

U.S. Customs and Border Protection has launched an initiative to enforce laws broadening the existing ban on imports of goods made with forced labour. This effort is currently focused on gathering information from importers, but CBP retains the authority to detain shipments suspected of non-compliance. In addition, importers may be at risk for monetary and criminal penalties.

19 USC 1307 prohibits the importation of goods mined, produced or manufactured, wholly or in part, in any foreign country by forced labour, including convict labour, forced child labour and indentured labour. Effective 1 March 2016, the Trade Facilitation and Trade Enforcement Act closed a loophole in this law that had allowed imports of certain forced labour-produced goods if there was insufficient domestic production to meet consumptive demands. When information reasonably indicates that goods within the purview of 19 USC 1307 are being imported, CBP may issue withhold release orders requiring detention of those goods at all U.S. ports of entry (and has done so with respect to a handful of goods from mainland China).

In a significant but little-noticed change, the Countering America’s Adversaries through Sanctions Act (H.R. 3364) created a presumption that “significant goods, wares, articles, and merchandise mined, produced, or manufactured wholly or in part by the labour of North Korean nationals or citizens” are forced labour goods in violation of 19 USC 1307 and prohibited from entry into the United States. This provision could have a significant impact on imports from mainland China, Russia, Mexico, Poland and other locations in which North Koreans have been known to work, including in the apparel, seafood and other industries.

This presumption may be rebutted for specific goods that CBP finds, by clear and convincing evidence, were not produced with convict, forced or indentured labour under penal sanctions. However, whereas 19 USC 1307 requires the U.S. government to prove that goods are made with forced labour, CAATSA places the burden on importers to prove that they are not; i.e., that North Koreans were not involved in the production of their goods or, if they were, that they were not working as forced laborers.

CBP has begun sending importers requests for information about their efforts to ensure their supply chains are free from forced labour, including labour performed by North Koreans. Among other things, CBP is asking importers to provide information on their due diligence programmes, contact information for manufacturers at all levels of their supply chains and copies of any forced labour audits, including findings and recommendations.

According to Sandler, Travis & Rosenberg P.A.’s member Marilyn-Joy Cerny, a U.S. Immigration and Customs Enforcement official said recently that importers may well need to change their approach to forced labour compliance because typical corporate social responsibility and supply chain due diligence processes will likely be insufficient to meet obligations under CAATSA.

Meanwhile, the DOL’s Bureau of International Labor Affairs is requesting comments and information no later than 12 January 2018 to be used in the preparation of certain documents regarding child labour and forced labour in foreign countries. The Trafficking Victims Protection Reauthorization Act of 2013 requires ILAB to submit to Congress every two years a list of foreign-made goods that it has reason to believe are produced by child and/or forced labour in violation of international standards. ILAB is also required to take steps to ensure that the goods on this list are not imported into the United States if they are made with forced or child labour, including working with producers to help set standards to eliminate the use of such labour.

This list currently includes a range of products made in mainland China, namely artificial flowers (forced labour), bricks (child and forced labour), Christmas decorations (forced labour), coal (forced labour), cotton (child and forced labour), electronics (child and forced labour), fireworks (child and forced labour), footwear (forced labour), garments (forced labour), nails (forced labour), textiles (child labour) and toys (child and forced labour).

Additionally, Executive Order 13126 prohibits federal agencies from acquiring goods produced by forced or indentured child labour, and the DOL maintains a list of products that it has a reasonable basis to believe might have been mined, produced or manufactured with such labour. Federal contractors who supply the products on this list must certify that they have made a good faith effort to determine whether forced or indentured child labour was used to mine, produce or manufacture them and that, on the basis of those efforts, they are unaware of any such use. The most recent EO 13126 list currently includes four products from mainland China: bricks, cotton, electronics and toys.

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