CBP Says More Forced Labor Findings Likely
Therese Randazzo, director of the forced labor division in the trade remedy and law enforcement directorate at CBP, said that although there have been far more withhold release orders than findings since legislation eliminated a forced labor loophole in 2015, the trade community should expect to see more findings in the future. Randazzo, who was speaking on a panel on forced labor at the annual Georgetown Law International Trade Update on March 11, declined to comment on whether CBP has opened an investigation into forced labor in polysilicon from China (see 2101080044). That's an input for solar panels, and about two-thirds of the world's solar panels are made in China.
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Fellow panelist Nate Herman, senior vice president for policy at the American Apparel and Footwear Association, said AAFA supports the goal of eradicating forced labor in supply chains and the use of WROs to bring that goal about, but that apparel importers are concerned about the process. “We need information, we need transparency,” he said, as frequently companies do not know which producers are on CBP's list as forced labor violators. “Sharing that evidence with the trade would be very helpful as the industry does its own due diligence to make sure it is not using high-risk suppliers,” he said.
The Human Trafficking Legal Center President Martina Vandenberg said that while some non-government organizations publish the complaints they submitted to CBP to start investigations, often the information behind a WRO must be secret to protect the identity of victims, who fear retaliation from their employers.
Herman said even companies that receive detention orders don't know what precisely triggered the detention. And CBP does not say how many detentions have resulted from certain WROs. He said AAFA thinks there might be 40 to 50 detentions under the Xinjiang cotton WRO, but can't be sure. Vandenberg agreed that CBP should release the number of detentions coming from a specific WRO.
Randazzo said CBP has to protect information not only because of the interests of victims, but also because it considers the investigations ongoing cases, even after a WRO, since there could be either a finding or a fine in the future. Criminal cases are also possible, she noted.
Vandenberg said the increased pace of detentions and WROs is encouraging to her group, as is the rising value of detentions -- more than $20 million from Oct. 1 through Dec. 31, 2020 (see 2012020032). She said the center's goal is to have more petitions, more WROs, more penalties, and most importantly, more prosecutions. She said bluntly, “If you are sourcing in Xinjiang you should be on notice, and you should get out.”
Randazzo said there are CBP and on the Department of Labor fact sheets that can be helpful to companies unsure about what is appropriate due diligence. “What we frequently see is that companies have great policies or great procedures in place, but they only go to the first or second tier of the supply chain,” she said. That's not enough to catch forced labor, especially in the case of cotton, which is five or six steps back from the end product. “I realize traceability is a challenge in many instances … but it’s important to look beyond that first tier,” she said.
Herman said it would be helpful if CBP could move faster when companies that had goods detained work to prove they have no nexus with Xinjiang. He noted one company that got an order lifted, but it took weeks, and it was the entire spring product for that firm. Another company has been waiting more than a month, and 60% of its inventory is being detained.
There could be far more WROs if a bill passes Congress that would shift the burden of proof to importers to show that goods from Xinjiang were not made with forced labor (see 2009170029 and 2101290045).
Herman said that AAFA supports the goals of the Uyghur Forced Labor Prevention Act, and expects some sort of legislation to pass this year. He said he hopes the Senate version will be the template, because it requires CBP, the Department of Labor and the State Department to develop an enforcement strategy before expanding the detentions. He said going to a rebuttable presumption would dramatically expand the scope of the region-wide WRO on cotton and tomatoes from Xinjiang.