Understanding the Uyghur Forced Labor Prevention Act (UFLPA)
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June 21, 2022 the United States' Uyghur Forced Labor Prevention Act (UFLPA) went into effect, mandating importers will now have to prove that all goods imported into any U.S. port of entry are not mined, produced, or manufactured wholly or in part with forced labor in the People's Republic of China.
Situation
The UFLPA was signed into law in December of 2021 and builds on previous efforts to combat the import of goods allegedly made with forced labor in the Xinjiang Uyghur Autonomous Region (XUAR), explains Supply Chain Practice Director Jim Yarbrough. While companies have worked to remove products and materials sourced in the XUAR, the region remains an important source of commodities such as cotton, polysilicon, chemicals, textiles, and apparel. Xinjiang produces an estimated 45 percent of the world’s polysilicon, he continues, an essential component in the manufacturing of solar panels, while an estimated 20 percent of the world's cotton supply, and 80 percent of China’s cotton supply, comes from Xinjiang.
Companies currently sourcing materials or products made with forced labor in the XUAR could result in a serious risk to corporate reputation, loss of shareholder trust, potential fines, and future financial losses.
Breakdown
Organizations must now meet and complete a series of due diligence requirements providing “clear and convincing” evidence that products and materials are produced without forced labor. Required documentation includes signed affidavits from product producers, purchase orders (invoiced and proof of payment), lists of production processes, transportation documents, daily manufacturing process reports, evidence regarding the importers’ forced labor compliance programs, and evidence of compliance with forced labor prevention protocols.
The UFLPA mainly relies on collaboration between the Department of Homeland Security’s Forced Labor Enforcement Task Force (FLETF) and Customs and Border Protection to ensure enforcement.
Now that the U.S. Government has begun rolling out guidance regarding this new legislation, BSI’s leaders will discuss the implications of this law and what it means for your business’s supply chain, sustainability, and security efforts during the webinar What the Uyghur Forced Labor Prevention Act Could Mean for Your Supply Chain on August 11.
For more BSI insights on other EHS topics, visit our Experts Corner. For real time updates on the UFLPA register for BSI’s SCREEN tool, this platform provides thorough daily analysis on the latest and most relevant global supply chain trends.
Jim Yarbrough, Practice Director, Supply Chain Risk Intelligence, leads BSI’s team of supply chain security analysts and assesses the potential threat of terrorism and cargo disruption to countries and businesses worldwide.
