15 Jun UFLPA Guidance from CBP
In late December, a nearly unanimous House and Senate passed the Uyghur Forced Labor Protection Act (UFLPA) and sent the bill to President Biden for his signature. He did so, beginning the 180-day clock to the day it would become law.
That day is June 21, 2022, and importers and government agencies and task forces have been working furiously towards that deadline. UFLPA is slightly different from the agency’s traditional Withhold Release Order (WRO) where it has researched and determined that a particular country, region or manufacturer is guilty of using forced labor. UFLPA supersedes existing WROs for the Xinjiang region.
UFLPA’s “rebuttable presumption” presumes guilt and places the burden of proof of innocence (read: no forced labor was used) on the importer. How do they plan to enforce this, and how are importers expected to affirmatively demonstrate that no forced labor was used? Since the law’s passage, the agency has been communicating with affected importers, a pool drawn from the entry data submitted for cargo release.
They began with Known Importer Letters in April, with the key paragraph of obligation in that letter reading:
“The Act requires CBP to apply the rebuttable presumption unless the importer can overcome the presumption of forced labor by establishing, by clear and convincing evidence, that the good, ware, article, or merchandise was not mined, produced, or manufactured wholly or in part by forced labor. This elevated standard will require the importer to not only use due diligence in evaluation of its supply chain, but also to respond completely and substantively to CBP requests for information regarding entries it may review.”
For companies who are members of CTPAT, the agency went further – informing them of their potential suspension or removal from the program for non-compliance.
“As your company has previously imported merchandise from locations or entities potentially subject to the Act, you are being notified that subsequent entries of such merchandise may result in, among other things, suspension or removal from the Customs-Trade Partnership Against Terrorism (CTPAT) program, seizure, forfeiture and/or penalties, or other appropriate action under the customs laws. Please note that this notice may serve as an aggravating factor should CBP take enforcement action upon determining future violations of the Act.”
Within the guidance document VIEWABLE HERE, the agency lays out what will happen with regards to the holding of an entry, remanding for an examination, their time frame to review, and methods of disposition if the goods are found to either be excepted from, or included in, the detention and prohibited entry. If excepted, as per the law, the exemption will be reported by the Commissioner of Customs to Congress.
In reviewing this guidance document, the agency remains silent on many things. Importers should expect that once enforcement begins that the time to release goods being held for UFLPA proof may rise and along with that, applicable storage, detention and demurrage documents.
CBP provides instructions on administrative relief when importers cannot provide sufficient proof at time of entry to protest a prohibited entry order. They have also provided a not insubstantial list of places that companies can go across multiple government agencies to determine compliance and actions to take with suppliers.
Finally, they have also grouped into three key areas of product export from the region – cotton, tomatoes and polysilicon – what specific action companies can take.
The beginnings of this process for importers whose supply chains run through the affected region will be bumpy, but Future Forwarding’s customs brokerage team is committed to working with our clients to quickly and readily respond to holds and inquiries from the agency. We encourage our customers with affected goods to carefully read this document and if you have not already done so, begin assembling proof to submit for entries which are held or detained. Together, we can work through these challenges with as minimal delays and additional costs as possible.