The House of Representatives on September 30, by a vote of 253 to 163, passed H.R. 6270, the Uyghur Forced Labor Disclosure Act of 2020. The bill requires public disclosure to the Securities and Exchange Commission (SEC) about any engagement with entities in the Xinjiang Uyghur Autonomous Region (XUAR). The bill covers imports of “(i) manufactured goods, including electronics, food products, textiles, shoes, and teas, that originated in the XUAR; or (ii) manufactured goods containing materials that originated or are sourced in the XUAR….”
The vote on this bill follows a September 17 hearing held by the House Ways and Means Committee’s Subcommittee on Trade on “Enforcing the Ban on Imports Produced by Forced Labor in Xinjiang [the XUAR) in China].” The hearing addressed the use of forced labor by members of the Muslim Uyghur minority and other minority groups to produce both raw materials, such as cotton, and finished goods, such as clothing and apparel, that ultimately enter the United States.
One main focus of the hearing was how to stop such goods and materials from entering the United States.
These developments reflect heightened scrutiny of cross-border trade by the legislative branch of the US government.
As the US government heightens scrutiny of, and expands enforcement actions on, cross-border trade, importers should continue to monitor their business models and exercise due diligence, especially with respect to their supply chains and sourcing.
Regarding the pending bills, we will continue to monitor any Senate action by year-end on both the Uyghur Forced Labor Prevention Act and the Uyghur Forced Labor Disclosure Act.