CBP is expected to officially allow for the use of foreign-trade zones for goods stopped under a withhold release order while an importer works to prove forced labor was not involved in making the imported product, said Christopher Smith, a trade adviser in the Customs Coordination Center for North America for IKEA Purchasing Services. Smith, also a National Association of Foreign-Trade Zones board member, spoke Feb. 9 during a NAFTZ virtual conference. “We believe we are very close to getting a letter in hand allowing for the use of zones to store product while a company will be able to argue whether or not there is forced labor associated with that product associated with a WRO detention,” he said.
House Ways and Means Committee Chairman Richard Neal, D-Mass., told an online audience Feb. 9 during a Washington International Trade Association conference that the Generalized System of Preferences benefits program will be restored this year, and that the benefits will be retroactive. He added, “I think that for all of its past successes, and I have been a supporter, it needs to be updated to keep us in line with progress as it relates to trade policy.”
CBP will focus on getting through a backlog of Customs-Trade Partnership Against Terrorism revalidations that it had been originally scheduled to perform in 2020 as it lays out its work plan for validations in 2021, said Manual Garza, CTPAT director at CBP’s Office of Field Operations, on a call with members of the National Customs Brokers and Forwarders Association of America on Feb. 3.
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CBP detained 90 shipments due to the possible use of forced labor on the goods from Oct. 1 to Dec. 31 of last year, the agency said in newly posted forced labor statistics. That seems to show a continuing trend of increased CBP forced labor actions (see 2012020032). For fiscal year 2021 as of Jan. 28, CBP has issued four withhold release orders, made one finding (see 2010190017) and revoked one WRO (see 2012080038). CBP hasn't issued any penalties so far in the fiscal year, it said. When asked about the dearth of penalties issued in recent years and whether more should be expected, a CBP spokesperson said: “CBP is committed to enforcing U.S. trade laws and maintaining a level playing field for U.S. domestic industry. We will continue to use all of our available authorities, including civil penalties, to prevent goods made by forced labor from entering U.S. commerce.” CBP collected its first penalty in August last year (see 2008140016).
The Senate version of a House bill on preventing the importation of goods made with forced labor in China's Xinjiang region has been reintroduced. Although the House bill passed in September 2020 on a 406-3 vote (see 2009220038), it too, will have to be reintroduced, since this is a new Congress.
Fashion trade groups are asking Congress to ensure that withhold release orders are administrable, and that CBP is fully funded so that it can implement effective WROs to fight forced labor in Xinjiang. The American Apparel and Footwear Association, the Footwear Distributors and Retailers of America, the National Retail Federation, the Retail Industry Leaders Association and the U.S. Fashion Industry Association wrote to leaders of both chambers of Congress from both parties saying they support legislation that builds on private sector efforts to root out forced labor in supply chains.
The White House is freezing rules that have been published, but have not taken effect, as well as proposed rulemaking and interim final rules, for 60 days from Jan. 20, so that the new administration can review the policies. The Trump administration issued a similar order in 2017 (see 1701230031), as did previous administrations.
Ramped up import enforcement efforts are likely here to stay under President Joe Biden, Sidley Austin's Ted Murphy said in an email. The multi-agency effort to crack down on import violations is expected to continue unencumbered and Murphy views these efforts as not administration-specific, particularly dealing with questions of forced labor, Section 301 tariff evasion and USMCA compliance.
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