CBP allowed for the release of some styles of men's shirts imported by Uniqlo that were detained over the suspected use of cotton from the Xinjiang Production and Construction Corps in China because the shirts were not made of cotton, the agency said in a May 18 ruling. The ruling, HQ H318835, discloses that CBP detained a second Uniqlo shipment over a possible XPCC connection. The first detention was mentioned in another recent ruling, in which CBP said Uniqlo hadn't sufficiently shown XPCC cotton wasn't used (see 2105130031). The ruling wasn't available on the CBP rulings database as of press time May 20.
A former U.S. trade representative and a former deputy national security adviser agree that companies that do business in China are stuck between a rock and a hard place, as they will anger China if they disavow abuses in Xinjiang or Hong Kong, but could break U.S. law if they make clothes with Xinjiang cotton.
China Foreign Ministry Spokesperson Zhao Lijian denied any forced labor exists in the Xinjiang province when asked about a Uniqlo shipment stopped by CBP over the possible use cotton from the Xinjiang Production and Construction Corps (see 2105130031). "There is no 'forced labor' in Xinjiang, only voluntary employment and free choice in the labor market," he said during a May 19 press conference, according to a transcript the ministry provided. "Certain Western politicians and anti-China forces spread lies to suppress certain companies and industries in China under the pretext of human rights, as part of their sinister conspiracy of containing China's development by disrupting Xinjiang," he said, according to an unofficial translation.
In a joint statement, Canada's trade minister, Mexico's economy minister and U.S. Trade Representative Katherine Tai said they reviewed USMCA committee work, noting progress and offering “recommendations for future work to maintain progress.”
Endless Frontier Act Requires More Reporting to Congress on Forced Labor, Counterfeits, Phase 1 Deal
The Endless Frontier Act, a massive bill working its way through the Senate that aims to improve the United States' ability to compete economically with China, also addresses a number of issues relevant to importers, including enforcement of the forced labor statute, seizure of counterfeits, and progress on the issues that led to the Section 301 tariffs on Chinese goods.
The day before the first USMCA Free Trade Commission meeting, U.S. Trade Representative Katherine Tai and Canada's trade minister, Mary Ng, talked about how to strengthen North American supply chains, combat forced labor and climate change, and reform the World Trade Organization.
International Trade Today is providing readers with the top stories from May 10-14 in case they were missed. All articles can be found by searching on the titles or by clicking on the hyperlinked reference number.
Mexico and Canada emphasized how the COVID-19 pandemic has proven the need for interlinked supply chains, but U.S. Trade Representative Katherine Tai emphasized supply chains' downside as she, Mexico's economy minister and Canada's trade minister sat down to the first Free Trade Commission meeting of the USMCA. Tai said, "Not only have we discovered the fragility of our supply chains, but we have just begun to appreciate the degree to which they run counter to our collective goals of ensuring that workers within North America, and outside it, are paid a fair wage, in a safe workplace."
CBP is now using audits in some cases to make sure e-commerce importers are compliant with the regulations, John Leonard, acting executive assistant commissioner for trade, said while speaking during a Coalition of New England Companies for Trade conference May 13. “We have begun to utilize them in the small package space, but it's baby steps,” he said. Many of the “stakeholders are not traditional importers that will have a normal set of auditable books and records that we're used to with larger entities.”
Arent Fox is launching a Forced Labor team led by Angela Santos to assist companies in implementing forced labor compliance procedures, the firm announced in a May 12 alert. Given CBP's increased focus on forced labor in global supply chains, the need for proper import compliance and supply chain due diligence is at an all-time high. The new team seeks to help with that compliance and offers other services such as protests and petitions for release of seized merchandise, forced labor codes of conduct, supplier forced labor agreements, supply chain evaluations, customs questionnaires, forced labor audits and protest, forfeiture and customs penalty cases, according to the alert.