Caustic Soda Represents 'Entirely Different' Risks for UFLPA Compliance, Report Says
The addition of caustic soda as a high priority sector for forced labor enforcement through the Uyghur Forced Labor Prevention Act represents an entirely new compliance challenge for importers because of its ubiquity and difficulty to trace, according to an Oct. 6 report by risk intelligence firm Kharon.
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Caustic soda, or lye, "touches everything from" smartphones to fabric dyes, plastics and kitchen cleaners, Kharon said, but the chemical is not listed as a component piece, which creates "an entirely different potential risk dynamic" for companies' UFLPA compliance programs.
The firm used the example of a New York-based cleaning supply manufacturer, which sourced caustic soda through Hong Kong company Xinjiang Zhongtai until 2023, when it was placed on the UFLPA Entity List. The company began sourcing its caustic soda from a Chinese supplier, whose online listings "suggest that the only branded caustic soda" that it markets is Zhongtai’s, "often in packaging emblazoned with Zhongtai’s web address," Kharon said.
"It’s not yet clear how CBP plans to enforce caustic soda imports under the UFLPA," Kharon said, but warned that importers of electronics, textiles and other goods produced with caustic soda should "assess their exposure by carefully tracing their supply chains, even if they can’t trace the chemical itself."