On June 21, 2022, the implementation of the Uyghur Forced labor Prevention Act (“UFLPA”) came into effect. The UFLPA establishes a rebuttable presumption that imports of all merchandise produced, in whole or part, in the Xinjiang Uyghur Autonomous Region of China, or by entities on the U.S. government’s UFLPA Entity List, are made with forced labor. The presumption applies to all downstream products which incorporate any inputs produced in Xinjiang or by an entity on the UFLPA Entity List, regardless of where the products are produced. Under the UFLPA, such merchandise will be prohibited entry into the United States unless the importer can rebut the presumption of forced labor by “clear and convincing evidence.”
The procedures under the newly implemented UFLPA replace the previous WRO/Findings process for merchandise detained for forced labor reasons. Under UFLPA, CBP has the authority to detain, exclude, or seize merchandise determined to be in violation of the UFLPA.
The Forced Labor Enforcement Task Force (FLEFT), under the U.S. Department of Homeland Security, published its UFLPA Strategy guidelines on June 17, 2022. This publication also includes the official UFLPA Entity List. These guidelines, along with the U.S. Customs and Border Protection (“CBP”) UFLPA Operational Guidance issued on June 13, 2022, provide importers with information on how to navigate imports subject to the UFLPA presumption.
How Does the UFLPA Affect Importers?
The UFLPA establishes heightened compliance standards for importers. To overcome the rebuttal presumption by “clear and convincing evidence,” importers must fully respond to information requests from CBP and demonstrate full compliance with the UFLPA Strategy guidelines. Importers should also be aware that CBP will not consider any barriers, i.e., cost, access, time, to due diligence or document retention when deciding whether to grant an exclusion for detained merchandise. In addition, the ULFPA Strategy requires that importers establish the following systems and records:
- Effective due diligence system in compliance with the U.S. Department of Labor’s Comply Chain
- Effective supply chain tracing – importers must know their suppliers and labor sources at all levels of the supply chain
- Supply chain management measures – established processes for vetting suppliers and tracking risks
Importers sourcing any goods or components from China should begin to prepare internal due diligence and supply chain tracing systems. Trade Pacific has been closely involved in the implementation of the WRO and UFLPA processes, and we have successfully achieved exclusions for detained merchandise on behalf of clients. Please reach out to one of the attorneys listed below for more information and best practices on UFLPA compliance and importation issues.