31 Oct The Importance of Supply Chain Mapping
With an increasing emphasis being placed by CBP on importers to know the source of every component and raw material in their supply chain, the agency now recommends that importers map their supply chain down to the fifth supplier level of raw materials to ensure that the product is free of forced labor. Beginning with the Customs Modernization Act in the mid-1990’s and now with a final rule published by CBP governing broker responsibilities in 19 CFR Part 111 and as part of their wider mission to update their regulations for today’s trade, there is a reinforcement and reiteration to importers – know where your goods are coming from.
According to the Global Slavery Index, the United States imports approximately $144 billion dollars worth of goods made with forced labor. These goods are, in fact, prohibited by Section 307 of the US Tariff Act and any goods that are reasonably suspected of being produced in such a way could be subject to a Withhold Release Order (WRO). A Withhold Release Order means that the goods will not be released for entry into the United States, and the goods could be subject to seizure and the IoR subject to steep fines.
It’s important to understand the definition of forced labor for these purposes. From the US Tariff Act: “All work or service which is exacted from any person under the menace of any penalty for its nonperformance and for which the worker does not offer himself voluntarily.” Menace could be anything from verbal threats, to withholding pay, deception, retention of identity documents, debt bondage, and even excessive overtime to more insidious acts like physical violence.
If we all do our part, we can keep ethically produced goods moving while eliminating the demand for forced labor supply.
Some suggested resources to help with supply chain mapping and compliance from the Department of Homeland Security (DHS) are as follows:
The U.S. Department of Labor’s Comply Chain
The U.S. Department of State’s Responsible Sourcing Tool
National Action Plan on Responsible Business Conduct
CBP’s forced labor website resources
CBP’s Withhold Release Orders and Findings
The appearance of forced labor for raw materials extends beyond Xingang and its cotton and photovoltaic cell industries. CBP has WRO actions in place for products from around the world. The requirement of importers to comply or risk denial of entry means that is extremely important that, working with our clients, Future Forwarding keeps the goods in your supply chain moving from raw material to final delivery to the customer, whether business or individual.
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