CBP Hoping to Improve WRO Transparency; Most Complaints Involve Hoshine, Xinjiang Cotton
RANCHO MIRAGE, California -- Two CBP officials acknowledged the continuing struggles faced by importers conducting forced labor due diligence and said the agency is working to make its investigations and detentions more transparent (see 2107210040). As CBP continues to issue withhold release orders (see 2103120051), AnnMarie Highsmith, CBP’s executive assistant commissioner in the Office of Trade, said the agency is hoping to better address importer concerns and encouraged feedback on enforcement efforts.
Sign up for a free preview to unlock the rest of this article
If your job depends on informed compliance, you need International Trade Today. Delivered every business day and available any time online, only International Trade Today helps you stay current on the increasingly complex international trade regulatory environment.
“I understand that this is a hard area,” Highsmith said Oct. 15 during the Western Cargo Conference. “But I want you all to understand that I'm committed to transparency in this process. I will release to you as much information as I can as soon as I can release it.”
The agency is receiving the largest number of forced labor complaints involving cotton imported from China's Xinjiang region (see 2101130053) and silica-based products produced by Hoshine Silicon Industry (see 2108050019), said Thomas Jesukiewicz, field director of CBP’s regulatory audit office in Long Beach, California. Importers need to “know the supply chain and the production all the way through the beginning, or they're going to run into issues,” he said. “I can tell you on Hoshine and Xinjiang, lots of containers are being held today.”
But Jesukiewicz also acknowledged that conducting due diligence is often challenging due to “extremely complex” production chains. He said he’s reviewed Hoshine’s production cycle with “various different companies” that have struggled to pinpoint where the raw materials are produced. “Can a company go back to the beginning of the production where the raw materials are? I have to say no. The majority, no,” Jesukiewicz said. “But there are a few that can.”
He said it would take a “very experienced auditor” to determine whether some imports were linked to Hoshine and forced labor. “I gotta tell you, it took an auditor probably the better part of six months to go through and trace records, which the importer thought were good, to be able to figure out and see whether that silicon was used or not in the products that they brought in,” Jesukiewicz said. “They can take it back so far, almost right to the end, but not to where the raw material is. They just don't know where that raw material is coming from.”
Highsmith said she is trying to better “collaborate with [importers] to facilitate the entry of legitimate merchandise” and keep forced labor out of U.S. supply chains. “I get that forced labor is creating challenges for folks,” she said. “I need to hear your feedback. I need to hear about things that are hard in the process so that we can address them.”
CBP so far this fiscal year has detained 1,432 shipments suspected of being made with forced labor, Highsmith said. “To judge by anecdotes, it feels like more than that, right?” she said. “This is what customs is designed to do. This is what we've always done: facilitate lawful trade.”
Jesukiewicz is hopeful that due diligence will become easier, especially as blockchain technology -- which can reduce supply chain communication and data transfer errors -- becomes more prevalent in supply chains. “With blockchain I think one day, when everybody's feeding information, where it starts from the original source and everybody adds something to it, we’ll have that traceability,” he said. “Today we don’t have that.”