The Department of Homeland Security (DHS) announced on September 14, 2020 that forced labor goods from China are now banned. The U.S. Customs and Border Protection (CBP) has issued Withhold Release Orders on products produced in China’s Xinjiang province. In a statement Acting CBP Commissioner Mark A. Morgan stated that the forced labor goods banned sends “a clear message to the international community that we will not tolerate the illicit, inhumane, and exploitative practices of forced labor in U.S. supply chains.”
China’s Treatment of Uyghurs in Xinjiang
The Uyghurs are a native ethnic minority in the Xinjiang province of China. Most Xinjiang Uyghurs are Muslims. The Chinese government has detained between 1 to 3 million Uyghurs in “re-education” centers to undergo psychological indoctrination programs. This program is considered the largest internment of an ethnic-religious minority since World War II.
Along with torture, forced sterilization, and sexual abuse, Uyghurs are subjected to forced labor to produce a number of products. Many of these products are exported worldwide. The Chinese Communist Party has a used forced labor camps since the days of Mao Zedong in 1949.
Australian Strategic Policy Institute Report
An investigation conducted by the Australian Strategic Policy Institute concluded that local governments and private brokers being “paid a price per head” by the Xinjiang government to organize detainment of Uyghurs. While the Chinese government claims detention is used to combat religious extremism, many have been detained for praying or wearing a veil. The report called on international companies to conduct a review of their supply chains to ensure human rights are not being violated.
Xinjiang Forced Labor Goods Banned
In 2020 the U.S. Customs and Border Protection (CBP) was ordered to withhold the release of products from Xinjiang Uyghur Autonomous Region including:
- Forced labor products from Lop County No. 4 Vocational Skills Education and Training Center in Xinjiang.
- Products made with forced labor from the Lop County Hair Product Industrial Park in Xinjiang.
- Apparel produced by Yili Zhuowan Garment Manufacturing Co., Ltd. and Baoding LYSZD Trade and Business Co., Ltd in Xinjiang.
- Cotton produced and processed by Xinjiang Junggar Cotton and Linen Co., Ltd. in Xinjiang.
- Computer parts made by Hefei Bitland Information Technology Co., Ltd. in Anhui, China.
These goods are banned under Section 307 of the Tariff Act of 1930 (19 U.S.C. 1307). This regulation prohibits the importation of all goods and merchandise mined, produced, or manufactured wholly or in part in any foreign country by forced labor, convict labor, or/and indentured labor under penal sanctions, including forced child labor.
China’s Continuing Trade Issues
China has been under increased scrutiny by the international community. This is resulting in increased trade barriers being imposed by the United States.
- The BIS placed Chinese companies involved in the building of artificial islands in the South China Seas on the Entity List thereby preventing them from receiving U.S. exports.
- Hong Kong Special Status was revoked by the Commerce Department due inhumane crack down of dissidents.
- The U.S. restricted Huawei’s access to U.S. semiconductor design and manufacture capabilities.
- Numerous parties and entities were placed on the Department of Commerce Military End Use (MEU) List.
- Calls from members of Senate to remove China from the Federal Retirement Thrift Investment Board (FTRIB).
- Sanctions on silica-based products from Chinese solar suppliers.
- Export bans to 64 companies and police departments associated with violations against Uyghurs, Kazakhs, and other Muslim ethnic minorities.
- Visa bans on officials complicit in Chinese human rights violations.
- Investment bans on companies involved in these human rights violations.
International Response to Crimes Against Humanity
In response to these human rights abuses China has been facing increasing pressure from the international community. In September 2022, the United Kingdom banned the Chinese delegation of attending Queen Elizabeth’s funeral. The U.K. has placed import bans applying to products made in Xinjiang. It has also placed sanctions against perpetrators of human rights violations in the central Asia province.
In August of 2022, the United Nations finally released its report on human rights abuses in the Xinjiang Uyghur Autonomous Region. These findings, which China has taken great exception to, confirm what the European Union and United States have long held.
These reports are expected to bring further actions by the European parliament against China. These actions could include targeting complicit individuals and entities and increases in fines, introduction of a human rights due diligence law, and take actions to protect Uyghurs and other residents of East Turkistan. The EU has already coordinated sanctions against perpetrators of human rights against Uyghurs.
On the multilateral front, aside from the United Nations and the EU, the Organization of Islamic Cooperation and the G7 have condemned China’s human rights violations.
Specific nations taking a stance against China’s actions include Canada, the Czech Republic, Germany, Italy, Japan, Lithuania, Malaysia, the Netherlands, Norway, Sweden, Switzerland, Taiwan, and Turkey.
China is facing growing pressure both internationally and within its own borders in response to failed policies. This is making the prospect of conducting business with organizations and entities in the nation less attractive. Organizations considering imports, exports, or investments with China must now consider this nations continued lack of stability as it attempts to cope with numerous issues. Additionally, the nation’s activities abroad including extensive cybercrime demonstrate the need for vigilance in dealing with an increasingly hostile nation state.
CVG Strategy Export Compliance Expertise
CVG Strategy export compliance can assist your team with consultant services including classifications and license applications. We can also tailor an export compliance program to fit the specific needs of your organization.
While many export compliance providers offer programs geared toward compliance with a single set of regulations, CVG Strategy offers a harmonized program that will ensure that your company is compliant to all regulations. Furthermore, we consolidate this program in a collection of documents that can be integrated into a quality management system.
The CVG Strategy team has over 20 years of experience in U.S. export controls. We can help you develop an ITAR Compliance Program appropriate to your organizations requirements and provide training to prevent occurrences. We also have the experience to assist in guidance when unforeseen incidents do occur to develop strategies to prevent future violations.