Today the US Department of Homeland Security announced another round of additions to the Uyghur Forced Labor Prevention Act (UFLPA) Entity List, and for the first time a seafood company was included. Customs and Border Protection (CBP) signaled this was coming at their annual trade summit earlier this year, so it is not a surprise. We have been closely following UFLPA implementation for years expecting this day might come. Here is a quick download of what we know, how enforcement differs from other regulations, and steps companies might consider to minimize their risk.
UFLPA Enforcement
The Uyghur Forced Labor Prevention Act became law in 2021, implementing the policy that the US considers all Uyghurs (and related persecuted groups) to be forced laborers, regardless of where or for whom they work. It is therefore illegal for Uyghurs to contribute at any stage in the supply chain for products imported to the US. The US has enforced this law in part through the creation of a UFLPA Entity List, which to date has largely focused on textile manufacturing in the Xinjiang Uyghur Autonomous Region (XUAR) of China. UFLPA enforcement is unique because it assumes non-compliance unless the importer can prove otherwise, or in CBP's words:
Effective June 12, 2024, U.S. Customs and Border Protection (CBP) will apply a rebuttable presumption that goods produced by these entities will be prohibited from entering the United States.
For full details on how enforcement works from CBP, read through their thorough list of FAQs on UFLPA.
The Shandong Meijia Group
The interagency body that manages the UFLPA Entity List determined that Shandong Meijia Group Co., Ltd. "...participated in XUAR government-sponsored labor transfer programs to transfer and receive individuals from persecuted groups, including Uyghurs, out of the XUAR for labor at its factory in Shandong." Shandong Meijia Group was one of 11 Chinese processors accused of using Uyghur labor in Outlaw Ocean's 2023 investigative reporting which linked 8 US importers and 1 US retailer to three of its subsidiaries (Rizhao Meijia Aquatic Foodstuff, Rizhao Jiayuan Foodstuff and Rizhao Meijia Keyuan Foods). While that information is now dated, it is reasonable to assume that Shandong Meijia Group would not have been listed if the government believed it was no longer was supplying the US market.
What to Do if you work with Seafood from China
Imports of seafood produced by Shandong Meijia Group or its subsidiaries will likely be detained and audited by CBP. When this happens, the importer will have to prove that the specific items they are importing were not produced using forced labor. This is a costly labor and paperwork-intensive process, but it is possible as other companies have done it before. Here are things US importers, processors, distributors and retailers should consider to minimize their risk of association with companies on the UFLPA Entity List:
- Assess your vulnerability: Determine if you are sourcing from this company. If you are, consider changing processors or seeking legal counsel (Jay Sterne at js@windstrat.com would be a good place to start) in the event your import is audited by CBP.
- Update your policies: You may not see this far back into your supply chain now, but that could change with the implementation of FSMA. Ensure your suppliers are aware of this new sourcing requirement. Consider updating sourcing policy documents to explicitly name the UFLPA Entity List as a compliance resource that suppliers need to monitor.
- Operationalize compliance: Monitor your data and records for appearance of this supplier moving forward, and track updates to the UFLPA Entity List as more seafood companies could be added in the future.
This blog post is intended for informational purposes only and does not constitute legal advice. If you are interested in automating your supply chain due diligence, contact us.
