Customs and Border Protection (“CBP”) hosted a webinar this week on implementation of the Uyghur Forced Labor Prevention Act (“UFLPA”).
Effective June 21, 2022, the UFLPA imposes a “rebuttable presumption” that the importation of any goods, wares, articles, and merchandise (“goods”) (1) mined, produced, or manufactured wholly or in part in the Xinjiang Uyghur Autonomous Region of the People’s Republic of China (“XUAR”), or (2) that are produced by certain identified entities, is prohibited by Section 307 of the Tariff Act of 1930 and that such goods are not entitled to entry into the United States. The presumption applies unless the Commissioner of CBP determines that the Importer of Record has complied with specified conditions and, by clear and convincing evidence, shown that the goods were not produced using forced labor, within 30 days of their detention.
The highlights from the CBP webinar are as follows:
- The Act will be implemented in accordance with the terms of the statute beginning June 21. There will be no phased-in implementation or de minimis exceptions. CBP detentions are expected to begin June 21.
- Existing WROs and corresponding goods from the XUAR will become subject to UFLPA on June 21.
- The Forced Labor Enforcement Task Force (“FLETF”) will publish its strategy with promised operational guidance for importers on June 21, which is the same date that the UFLPA rebuttable presumption takes effect.
The primary distinctions between the UFLPA and the existing prohibition on the importation of goods produced by forced labor under Section 307 of the Tariff Act of 1930 (19 U.S.C. § 1307) are:
- Rebuttable presumption that goods from XUAR or listed entities were produced by forced labor versus CBP determination that available information “reasonably but not conclusively indicates” goods were produced by forced labor;
- No issuance of Withhold Release Orders (“WROs”) versus issuance of WROs;
- 30-day time period versus 90-day time period for importers to provide evidence that the goods are not subject to the UFLPA or Section 307;
- Detention legal authority pursuant to 19 C.F.R. § 151.16 (Customs general detention authority) versus 19 C.F.R. § 12.42(a);
- Clear and convincing evidence standard versus 19 C.F.R. § 12.43 admissibility standards.
The government still has not issued the list or lists of entities that will be subject to the rebuttable presumption. Clients will need to be prepared to screen their import supply chains for these entities as soon as the list or lists are issued.
Detentions under, and information resources on, Section 321(b) of the Countering America’s Adversaries Through Sanctions Act (“CAATSA”) may prove useful for working through UFLPA issues. Section 321(b) creates a similar rebuttable presumption that goods mined, produced, or manufactured wholly or in part by North Korean nationals or citizens anywhere in the world were produced by forced labor and are not entitled to entry at U.S. ports, unless the Commissioner of CBP finds by clear and convincing evidence that the goods were not produced with convict labor, forced labor, or indentured labor.
CBP has been sending “Known Importer” letters to companies that it has identified as previously importing goods that could be subject to UFLPA. All clients should be reviewing their supply chains to identify potential exposure and determine whether they possess adequate information to respond to CBP inquiries and detentions within the 30-day timeframe. We are working with clients to assess supply chain risks, identify existing procedures and programs that address forced labor concerns, and develop and implement enhanced measures. Ocean shipments currently en route will be subject to the new UFLPA requirements when they arrive on or after June 21. It is too late to implement enhanced measures for these shipments.