The impact of the Uyghur Forced Labour Prevention Act US for reporting entities under the Modern Slavery Act 2018 (Cth)
This week the US House of Representatives passed a forced labour bill baring imports from the Xinjiang region of China. In this article we discuss the consequences of this presumption for reporting entities.
On Tuesday, US lawmakers in the House of Representatives passed the Uyghur Forced Labour Prevention Act by a vote of 406-3. The stated aim of the bill is to ensure that goods made with forced labour in Xinjiang do not enter the United States market. The bill therefore prohibits the importation of goods into the US made in the Xinjiang region.
Significantly, the bill acknowledges that audits to vet products and supply chains in Xinjiang are not possible given the ubiquitous surveillance and intimidation. Hence the need for a presumptive ban.
Recently, demand for action regarding the suspected use of state-sponsored forced labour in Xinjiang has grown. As many as 1.8 million Uyghurs and members of other ethnic Muslim minority groups are being held in mass internment camps in Xinjiang. Earlier this year the Australian Strategic Policy Institute estimated that at least 80,000 Uyghurs were assigned to work in conditions of forced labour at factories outside of Xinjiang that are in the supply chains of over 80 global brands. New research launched today by the Australian Strategic Policy Institute maps using satellite imagery 380 suspected detention centres. The Xingjiang Data Project presented satellite imagery showing “newly constructed detention facilities, along with extensions to existing facilities, that occurred across 2019 and 2020.”
The consequences of this presumptive bill are potentially far-reaching.
The impact on global trade would be significant as companies pivot from the region’s suppliers. It is estimated one in five cotton garments sold in the US contain cotton from Xinjiang. Moreover, the bill finds current or former internment camp detainees involved in the production of textiles, electronics, food products, shoes, tea and handicrafts.
For reporting entities in Australia, this bill represents another milestone in an ongoing drive for supply chain transparency and accountability. The goods and services in many reporting entities operations and supply chains may be linked to forced labour in Xingjiang.
Whether the Uyghur Forced Labour Prevention Act is enacted into law or not the message is clear: governments and the market are demanding that supply chain transparency and accountability become business as usual.
Executive Director and Principal Lawyer
Fairsupply.com.au Pty Limited
Liability Limited by a scheme approved by Professional Standards Legislation
 Nathan Ruser, ‘Documenting Xinjiang’s detention system’, The Xinjiang Data Project.