What is the UFLPA? 📰
Tracing your chain of custody documentation to ensure no forced labor was used. An introduction.
When?
- The Uyghur Forced Labor Prevention Act - UFLPA came into effect as of 21.06.2022 for companies wishing to import products (cotton specifically for fashion companies) to the United States. All companies will need to supply evidence demonstrating that those products were not made with forced labor, and meet the latest compliance standards.
Why?
The Law replaces the case-by-case implementation of Withhold Release Orders (WROs) on companies operating in, and product categories from China’s Xinjiang Uyghur Autonomous Region (XUAR) with a broad U.S. import ban and rebuttable presumption of the involvement of forced or otherwise prohibited labor.
- Multiple reports have claimed the use of forced labor in the region, and the enslavement of Uyghur people as a result. The law is the United States Government's action to address these concerns.
- According to official US Customs and Border Patrol (CBP) documents, in order to overcome the presumption, “importers must… respond to all CBP requests for information about merchandise under CBP review and demonstrate by clear and convincing evidence that the (products) was not mined, produced, or manufactured wholly or in part by forced labor”
What?
Companies will need to engage in advance planning to assess the business and legal risks posed to their supply chains by these rule changes, and develop appropriate compliance and due diligence mechanisms. Evidence that will need to be collected includes:
- Detailed description of supply chain including imported merchandise and components thereof, including all stages of mining, production, or manufacture;
- The role(s) of the entities in the supply chain, including shippers and exporters: for example, CBP will need to determine whether a supplier is also a manufacturer;
- A list of suppliers associated with each step of the production process, including names and contact information (addresses, email addresses, and phone number);
- Affidavits from each company or entity involved in the production process.
How?
Importers of Cotton products to the US will need to provide sufficient evidence to the CBP that their products and their supply chains were in no way associated with the Xinjiang region.
In order to do this Company-specific supply chain tracing documentation will need to be provided that can assure CBP agents that the cotton is forced labor free. Importers can stay prepared by taking some key actions:
✔ Provide sufficient documentation, including any records that may be kept in the ordinary course of business (e.g., purchase orders, payment records, etc.), to show the entire supply chain, from the origin of the cotton at the bale level to the final production of the finished product.
✔ Provide a flow chart of the production process and maps of the region where the production processes occur. Number each step along the production process and number any additional supporting documents associated with each step of the process.
✔ Identify all the entities involved in each step of the production process, with citations denoting the business records used to identify each upstream entity with whom the importer did not directly transact.
✔ Speak with retraced to see how we can help you tackle all points above.
This will all require companies and their supply chains to conduct multi-tier and scalable product backwards traceability.
Why is it notable for the Fashion industry?
- This will have a significant impact on the world's biggest fashion and textile companies...
- Companies will need to adapt fast....
- Scalable Traceability will be a must-have to ensure proper due diligence and risk mitigation....
🔗Read more about the UFLPA and the impact it will have on the industry
