DHS Expands Uyghur Forced Labor Prevention Act Enforcement List: Compliance & Risk Implications for U.S. Importers

The U.S. Department of Homeland Security (DHS) has added three new Chinese companies to the Uyghur Forced Labor Prevention Act (UFLPA) Entity List. These additions target seafood, aluminum, and footwear industries, critical sectors in Xinjiang’s economy, to block the importation of goods produced with forced labor into the U.S.

Effective immediately, U.S. Customs and Border Protection (CBP) will enforce a rebuttable presumption that goods from these entities are prohibited from entering the U.S. unless proven otherwise. This measure underscores the importance for U.S. companies to enhance their due diligence and compliance protocols to avoid legal and financial repercussions.

The DHS has added the following entities to the UFLPA Entity List:

• Dongguan Oasis Shoes Co., Ltd. (also known as Dongguan Oasis Shoe Industry Co., Ltd.; Dongguan Luzhou Shoes Co., Ltd.; and Dongguan Lvzhou Shoes Co., Ltd.)
• Shandong Meijia Group Co., Ltd. (also known as Rizhao Meijia Group)
• Xinjiang Shenhuo Coal and Electricity Co., Ltd.

“The Department of Homeland Security will not tolerate forced labor in U.S. supply chains and will enforce our laws across all industries and sectors,” declared Secretary of Homeland Security Alejandro N. Mayorkas. This firm stance signals to businesses the critical need for robust compliance systems.

Compliance and Risk Management Implications

The inclusion of these entities on the UFLPA Entity List highlights the growing complexity and risk associated with global supply chains, particularly those involving high-risk regions like Xinjiang. Companies importing goods into the U.S. must now navigate increased scrutiny and potential disruptions.

To mitigate risks and ensure compliance, U.S. importers should take the following actions:

1. Enhanced Due Diligence: Companies must perform thorough due diligence to trace the origin of their products and ensure no involvement of forced labor. This includes auditing suppliers and verifying labor practices.
2. Supply Chain Transparency: Businesses should map their entire supply chain to identify and mitigate risks associated with forced labor. Transparency is crucial for compliance with U.S. regulations.
3. Documentation and Verification: Maintaining detailed records and documentation proving the absence of forced labor in their supply chains is essential. CBP requires clear and convincing evidence to rebut the presumption of forced labor.
4. Engagement with Suppliers: Regular communication with suppliers about compliance expectations and standards can help prevent forced labor issues from arising.

Robert Silvers, DHS Under Secretary for Policy and Chair of the Forced Labor Enforcement Task Force (FLETF), emphasized the need for due diligence, stating, “It is imperative for companies to conduct due diligence and know where their products are coming from. The United States is taking concrete steps to keep goods made with forced labor out of U.S. supply chains.”

The DHS has identified significant risks associated with the newly listed entities:

Enforcement and Accountability

Since the UFLPA was signed into law in December 2021, the FLETF has added 68 entities to the Entity List, with a 240 percent increase in the last 12 months. This expansion reflects the U.S. government's commitment to eradicating forced labor from supply chains.

John Williams, executive director of the Southern Shrimp Alliance, underscored the ethical and legal responsibilities of U.S. importers, stating, “The Forced Labor Enforcement Task Force’s initiative sends a strong message that chasing lower costs and higher margins cannot replace ethical and legal obligations.”

The latest additions to the UFLPA Entity List highlight the importance of compliance and risk management in global trade. U.S. companies must prioritize due diligence, supply chain transparency, and thorough documentation to navigate the increased scrutiny and ensure compliance with U.S. import regulations. Failure to do so could result in significant legal and financial consequences, reinforcing the critical need for robust risk management strategies in today’s global economy.

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