[Congressional Bills 112th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2759 Introduced in House (IH)]
112th CONGRESS
1st Session
H. R. 2759
To require companies to include in their annual reports to the
Securities and Exchange Commission a disclosure describing any measures
the company has taken during the year to identify and address
conditions of forced labor, slavery, human trafficking, and the worst
forms of child labor within the company's supply chains.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
August 1, 2011
Mrs. Maloney (for herself, Mr. Smith of New Jersey, Ms. Speier, and Mr.
McGovern) introduced the following bill; which was referred to the
Committee on Financial Services
_______________________________________________________________________
A BILL
To require companies to include in their annual reports to the
Securities and Exchange Commission a disclosure describing any measures
the company has taken during the year to identify and address
conditions of forced labor, slavery, human trafficking, and the worst
forms of child labor within the company's supply chains.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE, ETC.
(a) Short Title.--This Act may be cited as the ``Business
Transparency on Trafficking and Slavery Act''.
(b) Findings.--Congress finds that--
(1) in 2010, the Department of Labor identified 128 goods
from 70 countries around the world made by forced labor and
child labor;
(2) the United States is the world's largest importer, and
in the twenty-first century, investors, consumers, and broader
civil society increasingly demand information about the human
rights impact of products in the United States market;
(3) in 2010, California enacted the first State law
requiring manufacturers and retail companies to publicly
disclose their policies to eradicate slavery, forced labor, and
human trafficking within their supply chains;
(4) the Smoot-Hawley Tariff Act of 1930, which prohibits
importation of goods made with forced labor or convict labor,
has a broad exception for goods that cannot be produced in the
United States in sufficient quantities to meet the demands of
American consumers;
(5) courts have also ruled that consumers do not have
standing to bring a civil action in United States courts for
enforcement of this provision of the Tariff Act, because the
legislative intent was to protect American manufacturers from
unfairly priced goods, not to protect consumers from tainted
goods, consequently, there are fewer than 40 enforcement
actions on record in the past 80 years; and
(6) other mechanisms related to slavery and trafficking in
the stream of commerce suffer from similar problems of limited
scope, broad exceptions, and inability to provide information
about specific suppliers whose goods are tainted.
(c) Sense of Congress.--It is the sense of Congress that--
(1) forced labor, slavery, human trafficking and the worst
forms of child labor are among the most egregious forms of
abuse that humans commit against each other, in the name of
commercial profit;
(2) the legislative and regulatory framework to prevent
goods produced through forced labor, slavery, human
trafficking, and the worst forms of child labor from passing
into the stream of commerce in the United States is gravely
inadequate; and
(3) legislation is necessary to provide the information
that the public demands, recognizing that businesses can be
part of the solution to these problems when they transparently
provide information to consumers and investors, and
subsequently respond to consumer and investor demands for
business reasons, rather than solely reacting to governmental
prescriptions on how to conduct their business.
SEC. 2. DISCLOSURE TO SEC RELATING TO SLAVERY CONDITIONS WITHIN PRODUCT
SUPPLY CHAINS.
Section 13 of the Securities Exchange Act of 1934 (15 U.S.C. 78m),
is amended by adding at the end the following new subsection:
``(r) Disclosures Relating to Slavery Conditions Within Product
Supply Chains.--
``(1) Regulations.--Not later than 270 days after the date
of the enactment of this subsection, the Commission shall
promulgate regulations requiring any person required to file
reports with the Commission under this section to include
annually in such reports, beginning with the person's first
full fiscal year that begins after the date of promulgation of
such regulations, a disclosure of any measures such person has
taken during the year for which such reporting is required to
identify and address conditions of forced labor, slavery, human
trafficking, and the worst forms of child labor within such
person's supply chains. Such disclosure shall include the
following information under the heading `Policies to Address
Forced Labor, Slavery, Human Trafficking and the Worst Forms of
Child Labor' describing to what extent, if any, the person
conducts any of the following activities:
``(A) Maintains a policy to identify and eliminate
risks of forced labor, slavery, human trafficking, and
the worst forms of child labor within its supply chain.
If the person maintains such a policy, the disclosure
shall include the text of the policy or a substantive
description of the elements of the policy.
``(B) Maintains a policy prohibiting the use of the
person's corporate products, facilities, or services to
obtain or maintain someone under conditions of forced
labor, slavery, human trafficking, and the worst forms
of child labor.
``(C) Engages in verification of product supply
chains to evaluate and address risks of forced labor,
slavery, human trafficking and the worst forms of child
labor. The disclosure shall--
``(i) describe the greatest risks
identified within the supply chain, and the
measures taken toward eliminating those risks;
``(ii) specify whether the verification was
or was not conducted by a third party; and
``(iii) specify whether the verification
process includes consultations with independent
unions, workers' associations, or workers
within workplaces and incorporates the
resulting certification or written comments
from such independent union, workers'
associations, or workers.
``(D) Ensures that audits of suppliers are
conducted to evaluate supplier compliance with the
person's company standards for eliminating forced
labor, slavery, human trafficking, and the worst forms
of child labor in supply chains. The disclosure shall
specify if the verification was not an independent,
unannounced audit.
``(E) Assesses supply chain management and
procurement systems of suppliers in the person's supply
chain, to verify whether said suppliers have in place
appropriate systems to identify risks of forced labor,
slavery, human trafficking, and the worst forms of
child labor within their own supply chain.
``(F) Requires suppliers in its supply chain to
certify that materials incorporated into the product
comply with the laws regarding forced labor, slavery,
human trafficking, and the worst forms of child labor
of the country or countries in which they are doing
business.
``(G) Maintains internal accountability standards,
supply chain management and procurement systems, and
procedures for employees or contractors failing to meet
the person's company standards regarding forced labor,
slavery, human trafficking, and the worst forms of
child labor. The report shall describe such standards
and systems.
``(H) Provides the person's employees and
management who have direct responsibility for supply
chain management, training on forced labor, slavery,
human trafficking and the worst forms of child labor,
particularly with respect to mitigating risks within
the supply chains of products.
``(I) Ensures that recruitment practices at all
suppliers comply with the person's company standards
for eliminating exploitive labor practices that
contribute to forced labor, slavery, human trafficking,
and the worst forms of child labor, including by
conducting audits of labor recruiters and disclosing
the results of such audits.
``(J) In cases where forced labor, slavery, human
trafficking, and the worst forms of child labor have
been identified within the supply chain, ensures that
remediation is provided to those who have been
identified as victims.
``(2) Interactive data format.--The rules issued under
paragraph (1) shall require that the information included in
the person's annual report be submitted in electronic form in
an interactive data format.
``(3) Public availability of information.--To the extent
practicable, the Commission shall make available to the public
in a searchable format on a website, a compilation of the
information required to be submitted under the rules issued
under paragraph (1).
``(4) Publication on the company's website.--Any person
filing the disclosure required by paragraph (1) shall make
available such disclosure on the person's Internet website with
a conspicuous and easily understood link to the relevant
information placed on the homepage of the website. The link on
the homepage shall be labeled ``Policies to Address Forced
Labor, Slavery, Human Trafficking and the Worst Forms of Child
Labor.'' In the event the person does not have an Internet
website, the person shall provide the written disclosure within
30 days after receiving a written request for the disclosure
from an investor or consumer.
``(5) Definitions.--For purposes of this subsection--
``(A) the term ``forced labor, slavery, human
trafficking and the worst forms of child labor'' means
child labor in violation of international standards
including International Labor Organization Convention
No. 182 and acts that would violate the criminal
provisions related to slavery and human trafficking
under chapter 77 of title 18 if they had been committed
within the jurisdiction of the United States;
``(B) the term `person' means any publicly-traded
or private entity required to submit any annual report
to the Commission, and having annual worldwide global
receipts in excess of $100,000,000;
``(C) the term `remediation' means the activities
or systems that a company puts in place to address non-
compliance with the standards identified through
monitoring or verification, which may apply to
individuals adversely affected by the non-compliant
conduct or address broader systematic processes;
``(D) the term `supply chain', with respect to a
person filing the disclosure required by paragraph (1),
means all suppliers of products, component parts of
products, and raw materials used by such person in the
manufacturing of such person's products or the
provision of such person's services, whether or not
such person has a direct relationship with the
supplier; and
``(E) the term `verification' means the process by
which a company is evaluated to determine compliance
with its documented program, including standards on
forced labor, slavery, human trafficking, and the worst
forms of child labor, including an evaluation of--
``(i) data gathered through monitoring
activities to ensure results are reliable and
process is credible; and
``(ii) the system established to remediate
violations to determine if remediation is
implemented and effective.''.
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