A memo published this past Monday from ArentFox Schiff offers an update and insights into enforcement of the US Uyghur Forced Labor Prevention Act (UFLPA). Among the more interesting points made by the firm about the current status of the law and its implementation:
“The FLETF’s [Forced Labor Enforcement Task Force] recent updates to the UFLPA Entity List are likely a response to Congressional criticism concerning the lack of additions to the list and an evolution in the FLETF’s enforcement strategy… Congress has sent letters to CBP [Customs and Border Protection] and the FLETF, as well as companies in several industries, including the apparel, solar, and automotive industries, inquiring into UFLPA enforcement strategies and due diligence efforts. The congressional pressure placed on the FLETF and CBP to enforce the UFLPA, as well as on companies to comply with the UFLPA, further indicates that heightened enforcement in more sectors is likely coming in the near future.”
Then there is this:
“The US government seemingly depends on NGO reports to assist in its enforcement of the UFLPA.”
As commerce between the US and China becomes increasingly strained by politics, claims about intellectual property theft and counterfeit goods, there is little doubt that Congress will maintain heightened interest in trade with China. This won’t be limited to the original list of high-priority sectors (apparel, cotton, tomatoes and polysilicon); as the memo notes, FLETF/CBP have already expanded into sugar and magnetic device production. I’m sure there will be more products/sectors added in 2024. Any goods, products or materials coming from China should be assessed to determine if there are any connections (direct or indirect) to the Xinjiang Uyghur Autonomous Region (XUAR). If so, be prepared to demonstrate compliance with the law and its due diligence requirements. Our blog from October on the updated multi-agency business advisory may be a helpful starting point.
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