New WRO Targets Cotton and Tomato from Xinjiang
Jan. 19, 2021
By: Meaghan E. Vander Schaaf
CBP has issued another Withhold Release Order (WRO) against Chinese products. The target of this order is cotton products and tomato products produced in China’s Xinjiang Uyghur Autonomous Region. CBP states the detention order is based on information that reasonably indicates the use of detainee or prison labor and situations of forced labor, including debt bondage, restriction of movement, isolation, intimidation, and threats, withholding of wages, and abusive living and working conditions.
The WRO on cotton and tomato products originating in China’s Xinjiang Uyghur Autonomous Region applies to cotton and tomatoes grown in that region and to all products made in whole or in part using this cotton or these tomatoes, regardless of where the downstream products are produced. These products include apparel, textiles, tomato seeds, canned tomatoes, tomato sauce, and other goods made with cotton and tomatoes. Importers are responsible for ensuring the products they are attempting to import do not exploit forced labor at any point in their supply chain, including the production or harvesting of the raw material.
This WRO is not completely unexpected. In July 2020, the U.S. Departments of State, Treasury, Commerce, and Homeland Security released a joint advisory for businesses with potential ties to Xinjiang. This advisory served to caution businesses about the reputational, financial, and legal risks of forced labor in Xinjiang, where the U.S. government believes the Chinese government subjugates Uyghur people and other ethnic and religious minority groups. On December 2, 2020, CBP announced a WRO on cotton and cotton products originating from the Xinjiang Production and Construction Corps, which the U.S. government considers an economic and paramilitary organization subordinate to the Chinese Communist Party.
Federal statute 19 U.S.C. 1307 prohibits the importation of merchandise produced, wholly or in part, by convict labor, forced labor, and/or indentured labor, including forced or indentured child labor. CBP detains shipments of goods suspected of being imported in violation of this statute. Importers of detained shipments may export their shipments or demonstrate that the merchandise was not produced with forced labor.
Effective January 13, this is already the fourth WRO that CBP has issued in 2021. In the year ahead WRO enforcement actions will remain an important supply chain and compliance issue. With that in mind, we encourage importers to take steps to ensure compliance with the law. At a minimum, this includes:
· Understanding the International Labor Organization’s indicators of forced labor;
· Understanding due diligence to identify forced labor, prison labor and child labor;
· Securing commitments from suppliers that they do not use forced labor, prison labor, or child labor;
· Including those commitments as conditions in purchase orders and contracts;
· Subjecting suppliers to on-site audits (there are several third parties that perform this service); and
· Taking immediate remedial action whenever the presence of forced labor is indicated.
If you have questions or concerns about forced labor in your supply chain contact any attorney at Barnes, Richardson & Colburn for assistance.