By Anthony Rapa, Alan G. Kashdan, and Hung Ou Yang
In recent years, global supply chains have come under increasing scrutiny due to concerns about forced labor and human rights abuses. Companies importing goods into the United States need to be aware of stringent laws and regulations designed to prevent products made with forced labor from entering the U.S. market. As an example that recently occurred, Giant Manufacturing, a Taiwanese company and the world's largest designer and manufacturer of bicycles, was subject to an order barring its bicycles from entering the United States because of perceived use of forced labor. Understanding these U.S. laws, which have become a priority enforcement target by U.S. regulators, is essential for businesses seeking to mitigate legal and operational risks associated with forced labor allegations.
This summary provides an overview of the key U.S. laws governing forced labor in supply chains, outlines the responsibilities of importers, and offers practical guidance on how to comply with these regulations. By proactively addressing forced labor risks, companies can avoid costly enforcement actions, and substantially reduce the affected time as a result of enforcement actions, if any.
What are the Relevant U.S. Laws?
For almost 100 years, the U.S. has prohibited the importation of goods that are produced, wholly or in part, in any foreign country by convict labor, forced labor, or indentured labor under penal sanctions. This prohibition, contained in 19 § U.S.C. 1307, is administered by U.S. Customs and Border Protection ("CBP"). The statute defines "forced labor" as "all work or service exacted from any person under the menace of any penalty for its nonperformance and for which the worker does not offer himself voluntarily.” It also includes forced or indentured child labor. Goods that CBP believes are subject to this prohibition will not be permitted entry into the United States. The importer will be given the opportunity to demonstrate otherwise, but if it cannot do so the goods must either be reexported, or destroyed.
Focusing on a particular practice of forced labor, in response to the Chinese government's crackdown and suppression of the Uyghur minority in Xinjiang province, in 2021 Congress passed the Uyghur Forced Labor Prevention Act ("UFLPA"). Widespread reports indicated that Chinese enterprises, with Chinese government approval, were using forced labor in Xinjiang, as well as transferring Uyghur nationals to work in other parts of China. The UFLPA creates a rebuttable presumption that goods mined, produced, or manufactured wholly or in part in the Xinjiang, or by an entity on the UFLPA Entity List maintained by CBP, are prohibited from entry into the U.S. under 19 § U.S.C. 1307. As is the case generally under 19 § U.S.C. 1307, goods produced in Xinjiang, or by entities on the UFLPA Entity List, may be presumed to violate 19 § U.S.C. 1307, and will be detained. The importer will then have the burden of overcoming this presumption. If it cannot, the goods must either be reexported, or destroyed.
Customs and Border Protection Indicia – What Does CBP Look For?
CBP's procedures to determine if goods are produced by convict, forced, or indentured labor are set out in regulation at 19 CFR § 12.42 to 12.45. CBP may self-initiate an investigation if there is a "reason to believe" that imported goods are produced by such labor. See 19 CFR § 12.42(a). Likewise, CBP may initiate an investigation based on information from outside parties with a "reason to believe" that imported goods are produced by such labor. See 19 CFR § 12.42(b). Both types of allegations require a full statement of the reasons for belief, a detailed description or sample of the merchandise, and all pertinent facts obtainable as to the production of the merchandise abroad.
Upon review of these allegations and supporting information, CBP will initiate action based on the circumstances of the case, and will consider representations from foreign interests, importers, domestic producers, or other interested persons. See 19 CFR § 12.42(d). If CBP finds that the available information "reasonably but not conclusively" indicates that merchandise falls within the purview of 19 § U.S.C. 1307, CBP will issue a withhold release order ("WRO") to prevent importation of such merchandise. See 19 CFR § 12.42(e). If CBP determines that the merchandise is subject to 19 § U.S.C. 1307, such findings will be published in the Customs Bulletin and the Federal Register. See 19 CFR § 12.42(f).
Any goods subject to CBP's finding that are directly or indirectly imported from the specified locality, or were made by a specified foreign producer, are treated as prohibited unless the importer provides satisfactory evidence that the merchandise was not manufactured in any part by the use of a class of labor specified in CBP's finding. See 19 CFR § 12.42(g). Importers may provide certificates of origin to CBP signed by the foreign seller or owner of the merchandise; if the merchandise was produced in a country other than the one exporting to the United States, or from a party that was not the producer alleged to be suing forced labor practices, the importer must submit an additional certificate signed by the last owner or seller in that country. The importer must also provide a detailed statement describing all reasonable efforts made to determine the source of the merchandise's components and the nature of the labor involved in its production, along with their belief regarding the use of the class of labor specified in CBP's findings at any stage of the manufacturing process. See 19 CFR § 12.43.
With respect to the UFLPA, CBP maintains a UFLPA Entity List, which consolidates four lists of companies subject to the rebuttable presumption under Section 2(d)(2)(B) of the UFLPA. These lists include:
(1) Entities in Xinjiang that mine, produce, or manufacture wholly or in part any goods, wares, articles, and merchandise with forced labor;
(2) Entities working with the government of Xinjiang to recruit, transport, transfer, harbor, or receive forced labor of Uyghurs, Kazakhs, Kyrgyz, or members of other persecuted groups out of Xinjiang;
(3) Entities that exported products made by entities in lists 1 and 2 from the People's Republic of China into the United States; and
(4) Facilities and entities, including the Xinjiang Production and Construction Corps, that source material from Xinjiang or from persons working with the government of Xinjiang or the Xinjiang Production and Construction Corps for purposes of the "poverty alleviation" program, the "pairing-assistance" program, or any other government-labor scheme that uses forced labor.
"Forced labor" can be found in practices other than directly compelling a person to work without wages. The International Labour Organization ("ILO") has compiled the following list of practices that may be indicia of forced labor, and that CBP will examine in its evaluations:
• Abuse of vulnerability
• Deception
• Restriction of movement
• Isolation
• Physical and sexual violence
• Intimidation and threats
• Retention of identity documents
• Withholding of wages
• Debt bondage
• Abusive working and living conditions
• Excessive overtime
These practices should not be considered an exhaustive list but are factors that CBP will consider in its review of a company's practices. If found to be present, these practices can be the basis for detaining merchandise and issuing a WRO.
What Can Companies Do to Address Alleged Violations?
If CBP is conducting an investigation into potential forced labor issues, or has already issued a WRO after such an investigation, interested parties may be able to take certain protective measures if they are able to produce evidence that forced labor was not used. As noted above, 19 CFR § 12.42(d) requires CBP to consider representations offered by foreign interest, importers, domestic producers, or other interested persons during the investigation. After a WRO is issued, importers may submit proof of admissibility documentation, including specifically signed certifications, to demonstrate that withheld merchandise was not produced using the forced labor outlined in the WRO.
With respect to CBP reviews under the UFLPA, importers may request an exception to the rebuttable presumption that their imported goods mined, produced, or manufactured wholly or in part in Xinjiang, or mined, produced, or manufactured by entities on the UFLPA Entity List, are not entitled to entry under 19 § U.S.C. 1307. CBP will evaluate the evidence presented and determine whether the rebuttable presumption has in fact been rebutted. In that regard, section 2(d)(6) of the UFLPA and the regulations provide guidance, which includes, among other things:
(1) Exercise appropriate due diligence and effective supply chain tracing, implementing supply chain management measures, and providing evidence that the goods were not wholly or partly from Xinjiang or otherwise produced in the People's Republic of China without the use of forced labor;
(2) Substantively respond to all inquiries for information from CBP; and
(3) Prove by clear and convincing evidence that the good was not mined, produced, or manufactured wholly or in part by forced labor.
Likewise, CBP's "Best Practices for Applicability Reviews" notes general best practices to avoid being subject to 19 § U.S.C. 1307. These include:
(1) Maintaining detailed records and documentation, including:
(2) Maintaining awareness by monitoring federal interagency, civil society, academic reports, news, or other sources for signs that products or suppliers may be at risk; and
(3) Ensuring a clear plan is in place for responding to detentions.
Interested parties may also contest CBP's determinations through judicial proceedings. Recent decisions by the Court of International Trade regarding forced labor have held that such determinations may be deemed "arbitrary and capricious" under the Administrative Procedures Act if they lack sufficient factual substantiation.
What Can Companies Do in Advance of Any CBPAction to Mitigate Risk?
As noted at the outset, on September 24, 2025, CBP took action under 19 § U.S.C. 1307 against the Taiwanese company Giant Manufacturing Co. Ltd., issuing a WRO against bicycles made by the Giant. CBP identified the following International Labour Organization forced labor indicators during its investigation of Giant:
1. Abuse of vulnerability,
2. Abusive working and living conditions,
3. Debt bondage,
4. Withholding of wages, and
5. Excessive overtime.
Companies can be subject to CBP action not only for their own direct production, but also for the actions of companies in their supply chain. To minimize this risk, companies can be proactive before being subject to a WRO by reviewing not only their own labor practices, but also those of companies in their supply chain.
In the past, companies may have considered that compliance requirements could be met by simply obtaining certifications from suppliers of their compliance with international labor norms. That is no longer the case. Now, in addition to ensuring that their own practices do not raise red flags, companies must have a handle on their complete supply chain. This will require identifying suppliers and their sub-suppliers of all major components of their items, and documenting their evaluation of the labor practices of each such supplier. For example, CBP has identified the following actions that suppliers of products that will be exported to the United States should undertake:
The level of due diligence expected will be closely linked with the risks in a particular company's supply chain. Thus, for example, companies sourcing materials or components from China will want to include in their compliance due diligence an inquiry into links with production or workers from Xinjiang. Similarly, the use of migrant labor at any step in the production process is a huge red flag, as labor rights violations are often associated with the use of migrant workers.
Conclusion
Recent CBP actions, such as those involving Giant Manufacturing Co. Ltd., underscore the importance of compliance with U.S. laws targeting goods made with forced labor. CBP's heightened attention on forced labor in supply chains requires thorough due diligence by companies to ensure compliance with the regulatory requirements discussed above, in order to avoid detention of imported goods at the border. By establishing rigorous monitoring, remediation, and independent verification procedures, enterprises can identify and mitigate their risks prior to action from CBP.
AUTHOR: Anthony Rapa
BLANKROME
Washington, D.C.
+1.202.420.2683
AUTHOR: Alan G. Kashdan
BLANKROME
Washington, D.C.
+1.202.420.2658
AUTHOR: Hung Ou Yang
Brain Trust International Law Firm
Taipei
+886-2-2707-9976
[email protected]
Disclaimer: While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer. For specific technical or legal advice on the information provided and related topics, please contact the author directly.
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