[Joint House and Senate Hearing, 118 Congress]
[From the U.S. Government Publishing Office]








 
IMPLEMENTATION OF THE UYGHUR FORCED LABOR PREVENTION ACT AND THE IMPACT 
                        ON GLOBAL SUPPLY CHAINS





=======================================================================

                                HEARING

                               before the

              CONGRESSIONAL-EXECUTIVE COMMISSION ON CHINA

                    ONE HUNDRED EIGHTEENTH CONGRESS

                             FIRST SESSION

                               __________

                             APRIL 18, 2023

                               __________

 Printed for the use of the Congressional-Executive Commission on China


              Available at www.cecc.gov or www.govinfo.gov
              
              
              
                           ______

             U.S. GOVERNMENT PUBLISHING OFFICE 
 51-889         WASHINGTON : 2023
               
              


              CONGRESSIONAL-EXECUTIVE COMMISSION ON CHINA

                    LEGISLATIVE BRANCH COMMISSIONERS

House

                                     Senate

CHRISTOPHER SMITH, New Jersey,       JEFF MERKLEY, Oregon, Co-chair
    Chair                            ANGUS KING, Maine
JAMES P. McGOVERN, Massachusetts     TAMMY DUCKWORTH, Illinois
BRIAN MAST, Florida
JENNIFER WEXTON, Virginia
MICHELLE STEEL, California
SUSAN WILD, Pennsylvania
ANDREA SALINAS, Oregon
ZACHARY NUNN, Iowa
RYAN ZINKE, Montana

                     EXECUTIVE BRANCH COMMISSIONERS

               DANIEL K. KRITENBRINK, Department of State

                  MARISA LAGO, Department of Commerce

                   THEA MEI LEE, Department of Labor

                     UZRA ZEYA, Department of State

                 LISA JO PETERSON, Department of State

                      Piero Tozzi, Staff Director

                   Matt Squeri, Deputy Staff Director

                                  (ii)


                            C O N T E N T S

                              ----------                              

                               Statements

Opening Statement of Hon. Chris Smith, a U.S. Representative from 
  New Jersey; Chair, Congressional-Executive Commission on China.     1
Statement of Hon. James P. McGovern, a U.S. Representative from 
  Massachusetts..................................................     3
Statement of Hon. Jeff Merkley, a U.S. Senator from Oregon; Co-
  chair, Congressional-Executive Commission on China.............     5
Statement of Hon. Ryan Zinke, a U.S. Representative from Montana.     6
Statement of Hon. Jennifer Wexton, a U.S. Representative from 
  Virginia.......................................................     7
Statement of Hon. Zachary Nunn, a U.S. Representative from Iowa..     8
Statement of Hon. Michelle Steel, a U.S. Representative from 
  California.....................................................     9
Statement of Anasuya Syam, Human Rights and Trade Policy 
  Director, Human Trafficking Legal Center.......................    11
Statement of Laura Murphy, Professor of Human Rights and 
  Contemporary Slavery, Helena Kennedy Centre for International 
  Justice, Sheffield Hallam University...........................    13
Statement of Kit Conklin, Nonresident Senior Fellow, GeoTech 
  Center, Atlantic Council.......................................    14
Statement of Elfidar Iltebir, President, Uyghur American 
  Association....................................................    17

                                APPENDIX
                          Prepared Statements

Syam, Anasuya....................................................    32
Murphy, Laura....................................................    38
Conklin, Kit.....................................................    41
Iltebir, Elfidar.................................................    42

Smith, Hon. Chris................................................    44
Merkley, Hon. Jeff...............................................    45
McGovern, Hon. James P...........................................    46

                       Submissions for the Record

Statement of Robby Stephany Saunders and Charles Benoit, 
  Coalition for a Prosperous America.............................    48
CECC Truth in Testimony Disclosure Form..........................    54
Witness Biographies..............................................    55

                                 (iii)


IMPLEMENTATION OF THE UYGHUR FORCED LABOR PREVENTION ACT AND THE IMPACT 
                        ON GLOBAL SUPPLY CHAINS

                              ----------                              


                        TUESDAY, APRIL 18, 2023

                            Congressional-Executive
                                       Commission on China,
                                                    Washington, DC.
    The hearing was held from 10:04 a.m. to 11:41 a.m., in room 
2360, Rayburn House Office Building, Washington, DC, 
Representative Christopher Smith, Chair, Congressional-
Executive Commission on China, presiding.
    Also present: Senator Jeff Merkley, Co-chair, 
Congressional-Executive Commission on China, and 
Representatives McGovern, Steel, Wexton, Nunn, and Zinke.

      OPENING STATEMENT OF HON. CHRISTOPHER SMITH, A U.S. 
REPRESENTATIVE FROM NEW JERSEY; CHAIR, CONGRESSIONAL-EXECUTIVE 
                      COMMISSION ON CHINA

    The hearing will come to order. I want to welcome everyone 
to this very first hearing of this Congress on the 
implementation of the Uyghur Forced Labor Prevention Act, a 
truly landmark piece of legislation--bipartisan legislation--
that has the potential to alter the dynamic of our ongoing 
struggle with the People's Republic of China. But only if it's 
implemented faithfully and properly.
    And make no mistake about what the stakes are in the 
struggle against the Chinese Communist Party. Not something 
anodyne like a simple ``strategic competition.'' Rather, we are 
in a survival struggle with a dictatorship and an authoritarian 
state that seeks global hegemony and the fundamental 
displacement of the United States and the liberal economic 
order throughout the world. To that end, the PRC will take 
advantage of the Western world's liberal trade regimen, while 
utilizing forced labor to give itself an unfair trade 
advantage, all with the ultimate objective of imposing its 
governance model upon the rest of the world.
    We have known for years that the PRC has used forced and 
prison labor. Indeed, I knew this as far back as 1991, when 
former Congressman Frank Wolf, a Member from Northern Virginia, 
and I, went to Beijing Prison No. 2 and found that at least 40 
Tiananmen Square activists were being forced to make jelly 
shoes and socks for export to the United States. We asked for, 
and got, from the warden there--his name was Warden Zhou--
samples that we brought back and got to the customs 
authorities, and said, this was being made by Tiananmen Square 
activists, human rights activists, and therefore, it is 
violative of the Smoot-Hawley Act. He put an import ban on it 
and the place closed. Of course, they just moved their 
operations elsewhere, but it showed that when you have 
information that is actionable, we can have an impact on the 
Chinese Communist Party.
    There was some personal satisfaction that we had from that, 
but again, not that much practical effect, and as to impacting 
the PRC's policy of utilizing forced labor, it was next to 
zero. In this case, we had evidence and a unique set of 
circumstances. I would point out that both George Herbert 
Walker Bush, then followed by Clinton and others, used to brag 
about how we had a memorandum of understanding, an MOU, with 
the Chinese Communist Party that if we thought something was 
being made through slave labor, we would bring it to them, they 
would investigate and tell us what the results of their 
investigation were.
    I remember meeting with some of the people in customs at 
our embassy in Beijing. And some of you may remember years ago, 
there was an ad with the Maytag repairman--they made their 
washing machines so well that they never had any work. They 
were always idle because there was no work. Well, these two 
customs officers reminded me of the Maytag repairman. They had 
nothing to do because nobody had actionable information that 
they could bring forward. So the MOU, while it sounded great as 
a talking point and at hearings, and the Clinton people trumped 
it up every time, I said, Not worth the paper it's printed on! 
We have to be able to investigate, not them. And of course, 
there was no implementation.
    And that's the genius of the Uyghur Forced Labor Prevention 
Act. The burden is no longer upon the good men and women of the 
CBP to prove that goods have been made by forced labor, but 
upon importers to prove that goods made in Xinjiang and 
elsewhere are free from the taint of forced labor. We know now 
that the CCP, under Xi Jinping, has declared war on the Uyghur 
people, labeling them as terrorists who must be destroyed root 
and branch. As a matter of fact, during the debate on the 
floor, I quoted where Xi Jinping himself said, ``show no 
mercy'' to the people in that region. And they have shown 
absolutely no mercy.
    This has led to massive detentions of more than a million 
people, maybe many more, of Uyghurs, many of whom are forced to 
work and are subjected to horrific human rights abuse including 
forced sterilization, forced abortion and, indeed, forced organ 
harvesting. You recall a bill that I had introduced--passed the 
House just a few weeks ago--putting a heavy focus on trying to 
combat that heinous crime of organ harvesting. And along with 
the Falun Gong, we now know that the Uyghurs are being targeted 
to have their organs stolen, to literally put them on an 
operating table and take out one to three of their organs in a 
terrible, terrible procedure. These human rights abuses are 
what the legislation is designed to combat.
    We know from reports released yesterday in advance of this 
hearing that CBP has seized over $961 million worth of goods 
since last June. This is an important start, as is CBP's 
holding of a Tech Expo for industry last month and its launch 
of a dashboard to track trade statistics. As Co-chair Merkley 
and I, joined by Ranking Member McGovern--who just joined us, 
and I will yield to him momentarily--and Senator Rubio stated 
in a letter addressed to the Department of Homeland Security 
last week, we do remain concerned over the lack of full 
transparency that would enable Congress to evaluate the 
efficacy of implementation.
    We're also concerned as to whether the rebuttable 
presumption standard is being fully implemented, and whether 
goods that are initially detained are subsequently being 
released without congressional or public reporting. We have 
questions as to why the robust entity list of bad actors that 
the legislation requires remains so spartan. We also question 
whether CBP is utilizing technology, such as isotopic and DNA 
testing, to its fullest to identify goods produced in the 
Xinjiang Uyghur Autonomous Region.
    Finally, we also question whether goods produced by forced 
labor outside of the autonomous region are being captured. We 
have been working with Homeland Security to follow up on well-
founded reports that work gloves sold under the Milwaukee Tool 
label in venues such as Home Depot are indeed produced by 
prison labor, at a prison in Hunan province, to be precise.
    Going forward, we will be taking a closer look at companies 
such as Milwaukee Tool and their alleged profiteering from 
forced labor, just as we have highlighted the role of Thermo 
Fisher Scientific in genetic data collection that enables 
repressive practices in both Xinjiang and in Tibet, and more 
nefariously, has been implicated in finding DNA matches from 
organ harvesting victims.
    It is our hope as a Commission that the legislation will 
prick the consciences of corporate actors. Some of our 
testimony clearly suggests that they're getting that message--
that we mean business, the administration and Congress, and 
that is a good message for them to get. We encourage them to 
scour their supply chains and make sure they are free from the 
taint of forced labor, and not to engage in transshipment to 
other countries either, where it is the same good just with a 
different statement of origin.
    Finally, it is my hope that the corporate actors will 
respond very favorably and will embrace this wholeheartedly, 
raising the cost of doing business in the PRC. It is also our 
hope that bottom-line concerns will motivate companies to do 
the right thing. Finally, for those who are incorrigible and 
seek to skirt the law, we will seek enforcement action and 
bring public scrutiny to bear.
    I'd like to now yield to my good friend and colleague, Mr. 
McGovern, for any opening comments he might have.

              STATEMENT OF HON. JAMES P. McGOVERN,
            A U.S. REPRESENTATIVE FROM MASSACHUSETTS

    Well, thank you, Mr. Chairman. Thank you for scheduling 
this hearing. I look forward to hearing the testimony of our 
witnesses on the implementation of the Uyghur Forced Labor 
Prevention Act, its impact on global supply chains, and how we 
might improve its implementation.
    On a personal note, as the author of the House legislation 
on the Uyghur Forced Labor Prevention Act, I want to thank my 
partner in this legislation, Senator Rubio, and fellow ranking 
member and my good friend and colleague Senator Merkley, for 
his leadership. And, of course, to Chairman Smith, not only for 
his leadership on this, but for, again, organizing this 
important hearing.
    This group of bipartisan Members of the House and Senate I 
think demonstrates the strong bipartisan support that this 
issue has received in both the House and the Senate. Since the 
UFLPA was signed into law, we have seen significant efforts by 
Customs and Border Protection (CBP) and the multiagency Forced 
Labor Enforcement Task Force, the FLETF, to implement the bill. 
As the lead enforcement agency, CBP has been a strong ally in 
its implementation. The law itself recognizes that 
implementation is multisectoral. It requires engagement, 
cooperation, and action by CBP, but also by the private sector, 
including importers, and by NGOs, which have research and 
monitoring capabilities.
    Last week, the CECC chair, co-chair, and ranking members--
namely, Congressman Smith, Senator Merkley, Senator Rubio, and 
I--wrote to DHS Under Secretary Robert Silvers, who chairs the 
Forced Labor Enforcement Task Force, to request more 
information on certain key aspects of the law's implementation 
to date. Due to the timing of today's hearing, neither CBP nor 
DHS was able to appear and provide their views and insights on 
implementing the legislation. I look forward to a future 
hearing where we can hear about their experience and 
suggestions for how to pursue comprehensive enforcement.
    The Uyghur Forced Labor Prevention Act was a targeted 
response to a specific, very serious human rights problem--the 
widely documented intentional use of forced labor in the 
Xinjiang Uyghur Autonomous Region of China. The use of forced 
labor is one of a set of interrelated policies implemented by 
the People's Republic of China against Uyghurs and other 
largely Muslim Turkic peoples in the region that, taken 
together, likely meet the legal definition of crimes against 
humanity and genocide. In the law, ``forced labor'' means all 
work or service which is exacted from any person under the 
menace of any penalty for its non-performance, and for which 
the worker does not offer himself or herself voluntarily--a 
definition first applied in tariff law in the 1930s.
    But section 3 of the bill, which establishes a presumption 
that the input prohibition applies to all goods mined, 
produced, or manufactured in the Xinjiang Uyghur Autonomous 
Region represents a new, even revolutionary approach to 
protecting human rights. Basically, instead of presuming that 
the norm is that human rights violations are not committed, the 
Uyghur Forced Labor Prevention Act presumes the opposite, that 
the standard practice is that rights violations are committed.
    This presumption is grounded in research that found that, 
one, the use of forced labor is pervasive in the Xinjiang 
region and two, because there's a lack of transparency and 
independent investigations and audits, it is impossible to 
distinguish between industry and manufacturing that involves 
forced labor and that which does not. So the law establishes an 
appeals process that allows a company to make the case that its 
goods are not produced with forced labor. But to do so, the 
company must provide clear and convincing evidence that they 
are not.
    There are several issues that merit attention as we review 
the implementation of the bill, which my colleagues have noted 
in their opening remarks, so I'm not going to repeat it. But as 
the implementation of the Uyghur Forced Labor Prevention Act 
advances, there will be lessons learned that may lead Congress 
to tweak the bill or related law. But it's worth repeating that 
the prohibition on importing goods made with forced labor is 
longstanding. And what this bill provides is a new approach and 
new tools for enforcement.
    So the interest in improving enforcement is here to stay. 
It's also important to remember that while the operational 
aspects of the bill are clearly focused on the Xinjiang Uyghur 
Autonomous Region, the statement of policy in the law is 
broader, namely, to lead the international community in ending 
forced labor practices wherever such practices occur, through 
all means available to the United States Government. American 
consumers should not have to wear clothing, or footwear, or eat 
food, or use devices made by forced labor--wherever it occurs. 
American companies should not profit off of forced labor.
    In brief, Mr. Chairman, I believe the vigorous, successful 
implementation of the Uyghur Forced Labor Prevention Act can 
establish not just a model but a roadmap on how to address 
forced labor everywhere. And I think I speak for everybody here 
who is involved in drafting this bill and fighting for it, that 
this is not a check-the-box initiative. I mean, this is 
serious. And all of us up here, Democrats and Republicans, are 
interested in making sure that it is enforced and is 
implemented faithfully. And we will continue to monitor that.
    So with that, I thank you, Mr. Chairman. I yield back my 
time.
    Chair Smith. Thank you very much, Jim.
    I'd like to now yield to the co-chairman of this important 
Commission, Chairman Merkley.

STATEMENT OF HON. JEFF MERKLEY, A U.S. SENATOR FROM OREGON; CO-
       CHAIR, CONGRESSIONAL-EXECUTIVE COMMISSION ON CHINA

    Chairman, thank you very much. The Uyghur Forced Labor 
Prevention Act is a testament to why the Congressional-
Executive Commission on China exists. Horrified by the evidence 
documented by the Commission's tireless researchers that the 
products of slave labor reach American shelves in vast 
quantities, the four most recent chairs of this Commission 
acted. And coming from the Senate side, a special recognition 
to Senator Rubio, who partnered in the bipartisan effort on the 
Senate side.
    On a bipartisan and bicameral basis, we introduced, 
advocated for, and passed landmark legislation that sent a 
resounding and unequivocal message that the United States would 
not stand idly by as the world witnesses the evils of genocide 
and the evils of slave labor. This law, the Uyghur Forced Labor 
Prevention Act, aims to target China's ability to profit from 
genocide, hold corporations that trade in products of forced 
labor accountable, and protect American consumers from being 
unwitting accomplices in these horrors.
    In the 16 months since it became law and 10 months since 
its key provisions went into effect, the UFLPA has made a 
difference. As we'll hear today, it's put businesses on notice 
that they can no longer claim that it's too difficult to trace 
their supply chains. Armed with substantial new resources 
provided by Congress, U.S. Customs and Border Protection now 
devotes unprecedented attention to investigating those supply 
chains and stopping problematic imports. As a result, direct 
exports from Xinjiang have plummeted and businesses are 
changing their practices to speed up production capacity 
elsewhere in the world, increasing the diversification and 
sustainability of their supply chains.
    But as much as we've accomplished, it's only the tip of the 
iceberg. Compliance with this law requires a paradigm shift. It 
requires companies to be vigilant in the same way we expect 
them to guard against bribery and corruption and money 
laundering. Companies that resist compliance or look to exploit 
loopholes need to be held accountable. The U.S. Government's 
Forced Labor Enforcement Task Force needs to implement the law 
even more aggressively, with particular attention to 
transshipment of Xinjiang-origin goods via third countries. 
Congress needs to make sure these efforts are fully funded and 
that any gaps we identify are plugged.
    Countries around the world need to take their own actions 
to make sure that the purveyors of forced labor can't just send 
their goods elsewhere. That action by other countries is needed 
to avoid bifurcated supply chains that allow companies to sell 
clean products in the United States and turn around and pocket 
the proceeds of tainted forced labor products elsewhere. It's a 
big challenge to implement a law, and it's a big challenge to 
implement this law with the complexity of international trade. 
But we owe it to the millions of exploited Uyghurs and other 
ethnic minorities in China.
    And as my colleague mentioned, this isn't just about China. 
This is about taking on this issue and setting a model for how 
we deal with it around the world. We owe it to American 
consumers who don't want to be part of the economic machinery 
of genocide, and to the businesses doing the right thing who 
want to play on a level playing field. It is an honor and a 
responsibility to take on this task in partnership with my 
colleagues on both sides of the House and both sides of the 
aisle. Thank you, Mr. Chairman.
    Chair Smith.Thank you very much. Thank you very much, 
Chairman Merkley.
    I'd like to now yield to Ryan Zinke, former Interior 
Secretary and a distinguished Member of Congress.

                 STATEMENT OF HON. RYAN ZINKE,
               A U.S. REPRESENTATIVE FROM MONTANA

    Thank you, Mr. Chairman. It is my honor to serve in this, I 
think, important committee. Let's just call China what it is. 
China's the largest polluter of emissions. We know that. Ninety 
percent of the world's plastics come from four rivers in China. 
And there are islands in the Pacific that are larger than 800 
kilometers in diameter. They're the largest offender of illegal 
fishing. And I'm deeply concerned about our reliance, and their 
monopoly on, critical minerals and components of the emerging 
EV world. In particular, I'm concerned about our reliance on 
cobalt, nickel, and critical minerals that China has either a 
monopoly on, or control of, and is using forced labor to 
acquire. The allegations and substantiated documentation of 
organ harvesting--I can think of no crime that is worse.
    So let's call China what China is. And let's work for a 
bipartisan solution to address the human rights, for humanity, 
and our country. And America, by the way, leads. For those that 
doubt, I would suggest you look otherwise. But America leads. 
And this is an important effort to expose, identify, and create 
solutions that matter. So with that, Chairman, I yield back.
    Chair Smith. Thank you very much, Mr. Zinke.
    Ms. Wexton.

               STATEMENT OF HON. JENNIFER WEXTON,
              A U.S. REPRESENTATIVE FROM VIRGINIA

    Thank you, Mr. Chairman. A U.S. Customs official recently 
referred to America and its current de minimis policy as our 
country's ``free trade agreement with China.'' Just last week, 
the co-chairs and ranking members of this Commission sent that 
letter to Under Secretary Silvers expressing concern over, 
among other things, the ability of CBP to enforce the UFLPA 
when de minimis shipping allows vendors to import goods without 
having to report basic data such as country of origin and 
manufacturer if the claimed value is under $800. In that 
letter, this Commission's leadership points out that Chinese 
companies such as Shein and Temu raise concerns about direct-
to-consumer purchases.
    These two China-backed online retailers make up an enormous 
share of the U.S. market. From February 26th to March 26th, 
2023, Temu and Shein came in first and fourth in the top five 
most downloaded apps in the U.S. across Apple's iOS Store and 
the Google Play Store, with over 10 million and 6.3 million 
downloads respectively. Shein was the most downloaded platform 
for beauty and fashion in the U.S. in 2022, with 27 million 
downloads. Shein has been accused of harvesting data on their 
customers and using it to manipulate their supply networks and 
to make products at lower cost than their competitors, fueled 
by underpaid and forced labor and raw materials from China.
    In February, a bipartisan group of U.S. senators called on 
Shein's CEO to answer questions regarding findings by Bloomberg 
that garments shipped to the U.S. included cotton from the 
Xinjiang region in China. On Friday, the U.S.-China Economic 
Security Review Commission published an issue that further 
outlined Shein's concerning patterns and practices. All the 
while, Shein continues to exploit our current de minimis policy 
to sell billions of dollars' worth of goods to American 
consumers, evading customs requirements ranging from tariffs to 
forced labor protections along the way. In fact, the business 
strategy has been so successful that it now holds the largest 
share of the U.S. fast fashion market, beating out giants like 
Zara and H&M. What's more, Shein, recently valued at over $100 
billion, is aggressively raising capital and plans to execute 
an IPO before the end of this calendar year.
    To conclude, it is imperative that we take action to 
mitigate Shein's exploitation of the current U.S. de minimis 
customs policy to ensure a fair and competitive marketplace. 
Additionally, we must ensure that companies and importers are 
absolutely committed to prioritizing human rights over profits. 
Thank you. I yield back.
    Chair Smith. Thank you very much, Ms. Wexton.
    I'd like to now yield to my distinguished colleague, Mr. 
Nunn.

                STATEMENT OF HON. ZACHARY NUNN,
                A U.S. REPRESENTATIVE FROM IOWA

    Thank you very much, Mr. Chair, and thank you to this 
bipartisan commssion for coming together to speak on this very 
timely and important issue.
    To the people of China, let us be clear. Here in the United 
States, we extend a hand in friendship. There is an on-ramp for 
us to work together and to have a successful future. But to the 
Communist Party of China, let us also be very clear. The 
exploitation, the bald-faced lies, everything from surveillance 
balloons to what they're doing within their own borders, will 
not be tolerated by the United States, and they must be held 
accountable to the same international norms the rest of the 
world is facing. I want to thank our panelists for being here 
today and providing the testimony so implicit in understanding 
what is happening inside Communist China today.
    As we've witnessed through countless acts, China is a 
repeat offender of humanitarian rights violations. As a former 
senior intelligence officer, and after nearly two decades 
working as a counterintelligence officer inside China myself, 
I've experienced firsthand what the Chinese intend to do both 
in their global threat as well as domestically to their own 
population. The Chinese government's treatment of ethnic 
minorities and forced detention of over a million Uyghurs in 
reeducation camps is yet another blatant violation by the 
Chinese government. And it's abundantly clear that China will 
do whatever it takes to achieve not only global domination but 
an infliction on its own people at any cost.
    The Uyghur Forced Labor Prevention Act, as was well 
highlighted today by our Chairman, is an important step forward 
and provides a powerful tool to address the human rights abuses 
and to promote fair labor practices in the global supply chain 
and prevent goods produced within the Uyghur forced labor camps 
from entering our markets here domestically in the United 
States. Since enforcement began in June of 2022, Customs and 
Border Protection estimates it's detained alone nearly a 
billion dollars worth of products that were meant to be sold in 
the United States coming from these forced labor camps inside 
China. These were meant to be purchased by unknowing consumers 
and presented by the state-sponsored Communist Chinese 
government as a way to offload its billing.
    Likewise, we've seen businesses shift their supply chain 
practices in order to retain access to the U.S. market, from 
corporations developing compliance and due diligence programs 
to ensuring that supply chains are free from forced labor 
around the world. But despite these efforts, industries 
attempting to enforce actions today still exist. One of the 
biggest challenges our companies confronted when trying to 
comply with the UFLPA is the lack of visibility into their 
supply chain and where it's coming from. We have become 
increasingly globalized in a complex network of supply chains, 
and the Chinese have used this to exploit and hide in plain 
sight where these sources are coming from. In China, companies 
are also responding to our actions here in the United States by 
shipping products to third countries and then finding a way to 
infiltrate U.S. markets, not unlike their production of core 
elements of fentanyl that are poisoning our streets.
    The United States must be persistent in its efforts. And in 
this committee today, we are addressing exactly that. The long-
term benefits of improving human rights and ethical practices 
in global trade are vital for a sustainable future for both the 
United States and our friends within China fighting against 
this. So let me be clear, my position on companies here in the 
West and around the rest of the world that are using forced 
labor camps in their supply chains, these companies also are 
complicit in China's blatant human rights abuses and should 
immediately develop compliance and due diligence programs to 
ensure that their supply chains are free of forced labor.
    So with that, Mr. Chairman, I look forward to hearing from 
our witnesses and discussing the impact and the challenges of 
the UFLPA, as well as our steps in Congress to ensure that the 
Xinjiang Uyghur Autonomous Region is no longer the global 
epicenter of modern-day slavery. Thank you. And thank you for 
allowing us to participate in this.
    Chair Smith. Thank you very much, Mr. Nunn. I do want to 
thank you especially for the expertise you bring to bear, 
having lived there. We'll look forward to tapping that wisdom 
that you will bring to bear on this Commission. So thank you so 
much for that.
    Michelle Steel, I believe, is online. I'm not sure if 
Michelle wanted to make any opening comments.
    Ms. Steel.

               STATEMENT OF HON. MICHELLE STEEL,
             A U.S. REPRESENTATIVE FROM CALIFORNIA

    Thank you, Mr. Chairman. Thank you for hosting this 
important hearing. The human rights abuses happening at the 
hands of the CCP should horrify every one of us. In 2021, 
Congress worked together and passed the Uyghur Forced Labor 
Prevention Act. I'm glad this Commission is reviewing the 
implementation, and we are working to ensure that we put an end 
to forced labor in the Xinjiang Uyghur Autonomous Region. Thank 
you to the witnesses for sharing with us your expertise on 
further congressional oversight and other changes needed to 
improve on this key issue. I just spoke this morning on the 
floor regarding the Vietnamese and the CCP's human rights 
violations. There are innocent people in prison because they 
are asking for freedom and democracy.
    I want to ask Elfidar Iltebir--if I mispronounced it, I'm 
sorry. I also sit on the China subcommittee. I recently spoke 
with a survivor of the Xinjiang region who is now using her 
platform to raise awareness to the world. She shared emotional 
stories about women being raped and experiencing other types of 
sexual assault. Can you share about the living conditions and 
quality of life for Uyghurs?
    Chair Smith. Thank you. We're going to have the opening 
statements first and then go to questions, but I know that 
Elfidar will take that and respond to it, so thank you so much 
for your opening comments.
    I'd like to now welcome our very distinguished panel, 
beginning first with Anasuya Syam. Ms. Syam is the human rights 
and trade policy director at the Human Trafficking Legal 
Center. She leads the Human Trafficking Legal Center's 
initiative on the U.S. Tariff Act and forced labor, with a 
focus on conducting investigations and submissions under the 
Tariff Act. She is the coauthor of the practice guide 
``Importing Freedom: Using the U.S. Tariff Act to Combat Forced 
Labor in Supply Chains,'' which provides advocates with the 
nuts and bolts of using the Tariff Act to halt goods made using 
forced labor from entering the United States. Ms. Syam received 
her bachelor's degree in law with honors from the National 
University of Advanced Legal Studies in India and graduated 
with a master's degree in international law from NYU School of 
Law. This is her first time testifying before Congress, and it 
won't be the last. So thank you, and we welcome you 
wholeheartedly.
    We'll then hear from Laura T. Murphy. We'll do it by way of 
Zoom. She's a professor of human rights and contemporary 
slavery at the Helena Kennedy Centre at Sheffield Hallam 
University. She is the author of numerous books and academic 
studies on the subject of forced labor and human trafficking 
globally. Her current work focuses on forced labor in Xinjiang, 
including the automotive, solar, apparel, and building material 
industries. Her work is extremely useful to the CECC and she is 
joining us today from Greece, so great is her dedication. Thank 
you for joining us today.
    We'll then hear from Kit Conklin, who is a nonresident 
senior fellow at the Atlantic Council's GeoTech Center and a 
global executive specializing in issues at the intersection of 
technology, commerce, and international security. In addition 
to his work with the Atlantic Council, Mr. Conklin is vice 
president at the research and data analytics firm Kharon. Mr. 
Conklin previously served in various national security 
positions within the U.S. Government. He holds an M.S. in 
emerging and disrupting technologies from the National 
Intelligence University and an M.A. from Middlebury Institute 
of International Studies. I'd also note that he delivered two 
keynote addresses at Customs and Border Patrol's tech expo just 
last month, which did a tremendous service in enlightening 
businesses that participated as to the dangers of sourcing 
goods made with forced labor in the PRC.
    Finally, we'll hear from Elfidar Iltebir, who is the 
president of the Uyghur American Association, or the UAA. Ms. 
Iltebir was born in Xinjiang, also known as East Turkestan. She 
emigrated to the United States in 2000. She has a B.A. in 
marketing from George Mason University and over 20 years of 
marketing and project management experience. She has taught the 
Uyghur language to U.S. Government employees. The daughter of a 
prominent Uyghur writer and journalist, she is an active member 
of the Uyghur community and an outspoken human rights activist, 
and has provided important and valuable insight to this 
Commission and to other committees of Congress that deal with 
human rights--House and Senate. In the previous three years, 
she served as the secretary general of the UAA. She was elected 
president in May 2022. She is currently well known to those of 
us in DC. I would note parenthetically that her sister works 
for Senator Rubio, and we're glad of that, and she is here with 
us today.
    Finally, I'd note that we've received a written submission 
for the record from Robby Saunders of the Coalition for a 
Prosperous America. And I ask, with unanimous consent, that it 
be included as part of the record.
    I'd like to now yield to our first witness, Ms. Syam.

   STATEMENT OF ANASUYA SYAM, HUMAN RIGHTS AND TRADE POLICY 
            DIRECTOR, HUMAN TRAFFICKING LEGAL CENTER

    Chairman Smith, Co-chair Merkley, and distinguished members 
of this Commission, thank you for the opportunity to testify 
before you today on the implementation of the Uyghur Forced 
Labor Prevention Act, one of the strongest pieces of 
legislation ever enacted to tackle forced labor in global 
supply chains. We are here because we know that letting goods 
made using forced labor circulate freely in global markets is 
not only morally reprehensible, it also undermines fair trade 
and hurts local businesses and workers.
    As one of the world's largest economies, the United States 
has significant leverage to make access to its markets 
contingent on the eradication of forced labor. We welcome this 
administration's proactive efforts to enforce the UFLPA. A good 
indicator of success is the way that enforcement, both under 
prior Xinjiang WROs and now the UFLPA, has catapulted forced 
labor into a serious compliance issue for companies and 
investors. Senior officials in the U.S. Government, including 
DHS Under Secretary Robert Silvers, underscored this change 
recently in the way forced labor is being perceived by the C-
suite. According to Under Secretary Silvers, forced labor is 
now a top tier compliance issue. We agree.
    Forced labor is no longer the provenance of weak codes of 
conduct or CSR measures. What changed? The advent of 
substantial legal and enforcement risk. Nevertheless, a few 
challenges do remain when it comes to UFLPA implementation. 
CBP's recently published UFLPA dashboard reveals gaps. Between 
June 2022 and April 2023, CBP targeted 3,588 shipments worth $1 
billion U.S., but only 490, or less than 0.13 percent, were 
actually denied entry into the U.S. market. The rest were 
either released into the U.S. or are currently pending review.
    Apparel and textile products valued at just $3 million make 
up 291 of the 490 shipments denied entry by CBP. These low 
detention numbers and low dollar value are concerning, 
especially when this sector is prioritized by the U.S. 
Government's implementation strategy. We also worry that CBP 
may be missing shipments containing inputs from the Uyghur 
region that enter the United States via third countries. CBP 
should have a specific strategy to address this issue, a 
critical element of which must be a robust program of onsite 
third-country verifications.
    Another big gap is in the data around re-exportation. Of 
the 490 shipments denied entry, we don't know how many 
shipments were sent to Canada, Mexico, or another country. We 
need to ensure that these countries are not dumping grounds for 
goods denied by CBP. Re-exportation data is critical for civil 
society as we support international partners in advocating for 
similar import bans in other countries. The dashboard also 
shows thousands of shipments pending review. Many are currently 
mired in applicability reviews, a process by which importers 
can show that the UFLPA does not apply to their shipments. The 
burden of proof applied by CBP in such reviews is much lower 
than the clear and convincing standard required to rebut the 
forced labor presumption. We need more visibility into the 
applicability review process to ensure that companies are not 
sidestepping UFLPA enforcement.
    Another issue that has garnered a lot of attention 
recently, including among members of this Commission, is the de 
minimis loophole. Shipments under $800 are exempt from duties 
and may enter the United States without formal entry 
documentation--a major impediment to collection of data 
necessary to enforce import bans. Last fall, Bloomberg News 
reported that Xinjiang cotton was found in apparel shipped by a 
major Chinese fast-fashion company to U.S. consumers. This 
confirmed what many had long suspected--companies, especially 
e-commerce platforms that rely on direct-to-consumer models, 
may be circumventing the UFLPA. We need to revise our de 
minimis provisions, including mandating the collection of 
supply chain data from shippers, to ensure that this is not 
exploited as a backchannel entry for goods made using forced 
Uyghur labor.
    Many of these goods actually enter the United States via 
air or land transportation. Currently, only maritime shipping 
data is shared with the public. Public disclosure of all trade 
data is critical to our efforts to trace forced labor risks and 
facilitate enforcement. We call on Congress to mandate public 
disclosure of trade data involving all modes of transportation. 
The United States cannot act alone. There should be no safe 
harbor for goods made with forced labor anywhere in the world.
    A patchwork of import ban laws with different standards 
will only frustrate enforcement. In the absence of 
international coordination, we run the very real risk of 
companies simply dumping these goods in other countries, 
especially our neighbors, Canada and Mexico. The USMCA requires 
each of the signatories to have import bans, but so far the 
U.S. is the only country implementing one. The U.S. should push 
Mexico and Canada to enact similarly robust bans on goods from 
the Uyghur region. We should also work with our G-7 and G-20 
allies to ensure global adoption of import bans that are 
consistent with each other.
    I will close by noting that we are at a pivotal moment in 
global trade, one where trade sanctions have become the norm in 
efforts to address forced labor across the supply chain. We 
acknowledge the enormity of the task before CBP and other 
agencies in the Forced Labor Enforcement Task Force. By 
addressing the gaps outlined in the testimonies today, along 
with a more robust forced labor enforcement strategy, we are 
confident that the U.S. Government can create the economic 
pressure needed to disrupt forced labor in China and around the 
world. Thank you.
    Chair Smith. Thank you so very much, Ms. Syam, for your 
testimony and your expertise.
    I'd like to now yield to Laura Murphy, if she wouldn't mind 
signing on.

   STATEMENT OF LAURA MURPHY, PROFESSOR OF HUMAN RIGHTS AND 
 CONTEMPORARY SLAVERY, HELENA KENNEDY CENTRE FOR INTERNATIONAL 
              JUSTICE, SHEFFIELD HALLAM UNIVERSITY

    Thank you, Chairman Smith and Co-chairman Merkley, for 
convening this meeting, and thank you to the congresspeople who 
have supported the rights and freedom of Uyghur people. My name 
is Laura Murphy and I'm Professor of Human Rights at Sheffield 
Hallam University in the United Kingdom. I've studied forced 
labor globally for 20 years, and my work for the last three 
years has focused exclusively on the Uyghur region of China.
    The Uyghur Forced Labor Prevention Act is indeed landmark 
legislation, as we've heard several times today. Those of us 
who study forced labor have long known that legislation of this 
kind is critical to ensuring the rights of workers in our 
global supply chains. It is disturbing to realize that it took 
a genocide for us to understand just how dire the consequences 
of our ignorance and inaction could be. It is commendable that 
the U.S. is the first to create legislation that levels real 
economic costs on the PRC government's state-sponsored forced 
labor program.
    While we still have a long way to go before we intercept 
all products made in the Uyghur region, the UFLPA is indeed 
working as it was intended. In the short nine months that the 
UFLPA has been in effect, we have seen swift and decisive 
enforcement response and targeted funding allocations. This law 
has protected American consumers from unwittingly buying 
products that we know to be made in the midst of a genocide--in 
the shadows of a massive internment camp system--by people who 
are forced to leave their children, and parents, and land, and 
culture, and religion, and communities behind to work in the 
factories that make the things we buy.
    Since the UFLPA went into effect, however, companies have 
not all responded enthusiastically. Many U.S. corporations 
lobbied to prevent the law from being passed and then fought to 
limit how it would be enforced and now are complaining that 
investigations are not convenient for them. Many companies 
still have their heads in the sand, hoping that their products 
will not be scrutinized. Some are shifting the burden of due 
diligence onto their suppliers, rejecting the responsibility 
and the costs of knowing the conditions of workers in their 
supply chains. They throw their hands up as if helpless as 
auditors in China are jailed, their offices ransacked, and they 
refuse to admit what is becoming increasingly clear, that there 
is no feasible way to verify labor standards compliance in the 
Uyghur region or of Uyghurs working outside the region. They 
care about the safety of their directly employed China-based 
personnel but do not worry about the Uyghurs who are at the end 
of their supply chains.
    This all shows that companies across sectors must be 
compelled through rigorous enforcement to comply with the 
UFLPA. In China, we're seeing companies pretend to sell their 
Uyghur region factories, only to transfer them to executives 
within their own leadership team or family. They change the 
names of their subsidiaries to obscure their identities. They 
ship their products through other countries to mask their 
origin. They bifurcate their supply chains so they can continue 
to sell goods in the U.S. market while selling Uyghur forced 
labor-tainted goods elsewhere in the world. Some of those 
companies are benefiting from Inflation Reduction Act 
incentives while continuing to operate or source in the Uyghur 
region.
    The U.S. should prohibit companies from using U.S. 
Government incentives to expand their manufacturing in the 
United States while they continue to profit from Uyghur forced 
labor in China.
    Our research team at Sheffield Hallam University has 
identified 55,000 companies operating in the Uyghur region. We 
have published in-depth investigations that have documented at 
least 150 specific companies for which there is significant 
evidence of participation in state-sponsored transfer of Uyghur 
labor. And yet, confoundingly, the UFLPA-mandated Entity Lists 
include only four of the companies we identified as offenders, 
and exactly zero new companies have been added to the list 
since the UFLPA was passed.
    Under Secretary of Homeland Security Robert Silvers 
recently committed to expanding the Entity List. The U.S. 
Government needs to make the Entity List a priority, and make 
those lists as comprehensive as possible, per the mandate of 
the UFLPA. Congress should declare to the Forced Labor 
Enforcement Task Force (FLETF) that it must presume that all 
state-sponsored labor transfers in the Uyghur region constitute 
forced labor and that FLETF should add any company engaged in 
those coerced transfers of labor onto the lists. These lists 
will assist importers in ensuring that they know which 
suppliers to exclude from their sourcing.
    Lastly, some international companies and governments are 
claiming the UFLPA is merely the product of a trade war between 
the U.S and China, in an attempt to justify their indifference. 
But the UFLPA is not a national security measure, like certain 
technology export restrictions. Nor is it a measure intended to 
offset economic injury to U.S. companies and workers, like 
anti-dumping and safeguard duties. The UFLPA fundamentally 
expresses U.S. support for internationally recognized human 
rights. It is crucial that the U.S. Government encourage our 
allies to align their laws to prohibit the import of forced 
labor-made goods. But this must not be conflated with policies 
intended to advance geopolitical or economic interests.
    I'm pleased that we're having this hearing to review all 
that the UFLPA has accomplished and to consider what more we 
can do to lead the world in addressing this crisis. Even though 
Uyghurs continue to be forced to work in China, we in the 
United States should not be financing their suffering. Thank 
you.
    Chair Smith. Ms. Murphy, thank you very much for your 
testimony and your expertise being brought to bear on this 
important piece of legislation and next steps. Thank you for 
that.
    I'd like to now yield such time as he may consume to Kit 
Conklin.

 STATEMENT OF KIT CONKLIN, NONRESIDENT SENIOR FELLOW, GEOTECH 
                    CENTER, ATLANTIC COUNCIL

    Thank you and good morning. Chairman Smith, Chairman 
Merkley, distinguished members of the Commission, thank you for 
the opportunity to speak with you this morning. I would like to 
start by saying that all views are my own.
    As discussed by others, the UFLPA bans the import of goods 
or commodities from China produced with forced labor. 
Specifically, the UFLPA mandates a rebuttable presumption that 
assumes any products made wholly or in part in the Xinjiang 
Uyghur Autonomous Region, by any Chinese company on a U.S. list 
of entities involved in the use of forced labor, are made with 
forced labor and therefore banned from importation into the 
United States.
    As Dr. Murphy discussed, reflecting the increased 
international consensus on the need to address forced labor, 
U.S. trading partners around the world have also enacted or are 
introducing legislation to ban products made with forced labor. 
These include the European Commission, Germany, France, Canada, 
Mexico, among other jurisdictions. Each of these bans similarly 
requires importing companies subject to the laws of these 
jurisdictions to engage in supply chain due diligence to 
identify and mitigate exposure. I think it's important to note 
that U.S. companies are not alone. Expectations are increasing 
around the world to address and identify forced labor exposure 
in global supply chains.
    With respect to enforcement, CBP has stated that UFLPA 
detentions constitute less than 0.1 percent of goods imported 
into the United States. And since enforcement of the UFLPA 
began in June of last year, CBP has detained approximately $1 
billion worth of goods suspected of containing inputs made with 
forced labor in China. It's important to note, however, that 
CBP has prioritized enforcement relating to four goods--cotton, 
polysilicon, tomatoes, and aluminum.
    The scope of the UFLPA, however, is much larger than these 
four prioritized commodities. For instance, billions of 
dollars' worth of raw materials, rare earth and critical 
minerals, and products are exported from Xinjiang each year, 
including a significant percentage of global lithium-ion 
batteries, 20 percent of the global production of calcium 
carbide, 10 percent of the global production of rayon, 9 
percent of beryllium deposits--which, I should note, are a key 
rare earth mineral used for the production of satellite and 
aviation components--and 8 percent of global pepper production.
    This matters because in addition to all of these raw 
materials and goods sourced from Xinjiang, the UFLPA also bans 
products made with forced labor in other provinces in China. 
Sometimes that's forgotten. Clearly, the scope of the UFLPA is 
broad, but CBP has been very explicit about the type of 
guidance that companies should consider with respect to 
compliance. The challenge of course though, is that the volume 
and scope of goods targeted under the UFLPA poses significant 
challenges for industry. Supply chains have become increasingly 
globalized, complex, and opaque. And the critical challenge for 
industry--to discover supply chain visibility and detect risk--
is compounded by the Act's rebuttable presumption and a lack of 
a de minimis exception, that was discussed earlier.
    This means that even an insignificant input of product 
produced in whole or in part with forced labor could result in 
an enforcement action. The global nature of supply chains 
further complicates compliance because CBP maintains the 
authority to detain goods imported into the United States from 
third countries. And this gets to a core issue that's been 
discussed already this morning. Since the UFLPA enforcement 
began in June of last year, CBP has detained $490 million worth 
of goods from Malaysia and over $369 million worth of goods 
from Vietnam. To provide a bit of perspective here, CBP has 
only detained $89 million worth of goods imported directly from 
China. These figures illustrate UFLPA transshipment risk and 
why the lack of a de minimis exception necessitates the need 
for due diligence in all suppliers, not just those located in 
China.
    It should also be noted that beyond the four products 
categorized for high priority for enforcement, CBP has publicly 
stated that it is considering other product categories that 
will be subject to enforcement. Regardless of any possible 
further announced priorities, as some in industry have 
requested, CBP guidance issued in 2021 and then amended last 
year sets forth red flags for forced labor exposure for all 
categories of products that pose UFLPA risk.
    These include things like labor transfers, supply chains 
connected to prisons, and any affiliates of the Xinjiang 
Production and Construction Corps. The amended guidance is very 
clear and states that UFLPA compliance requires supply chain 
mapping, the intelligence needed to identify and assess forced 
labor risk, training, and monitoring of suppliers, and that 
compliance is not static with UFLPA. It requires consistent and 
regular updates.
    So what's the ``so what''? Similar to industry responses 
when countering money laundering, sanctions, or anti-bribery 
compliance became priorities, CBP's enforcement posture is a 
major driver for the material investments industry is making to 
address UFLPA due diligence and compliance. And as CBP's budget 
and resources expand to counter the forced labor mission, many 
in industry are certain to adapt with increased senior 
management attention, and with support and budget for the 
technology and people needed to address risk.
    In line with guidance, companies that make reasonable risk-
based investments to identify risk should be positioned to 
identify UFLPA exposure and take measures to mitigate that 
risk. And as industry implements UFLPA compliance programs, 
global supply chains will evolve, as companies mitigate that 
risk and build resilience. Observers have already pointed to 
the UFLPA's impact on supply chains relating to green energy 
products, rare earth minerals, food items, and pharmaceutical 
precursors. Companies that have those goods prioritized for 
detention by CBP have already started to see their supply 
chains evolve.
    In summary, compliance with UFLPA is complex. This is 
similar to compliance with anti-money laundering, sanctions, 
anti-bribery, and other regulations. Nonetheless, with senior 
management support and in line with guidance, effective risk-
management programs can be established to identify UFLPA 
exposure and mitigate the risk of forced labor in global supply 
chains. As DHS Under Secretary Silvers recently stated, ``over 
the years, things like anti-
corruption and sanctions compliance have come to become 
standard pillars of corporate compliance programs. Forced labor 
needs to be one of those pillars as well.''
    Thank you for your time this morning.
    Chair Smith. Mr. Conklin, thank you very much for your 
testimony, your insights, and your leadership.
    Ms. Iltebir.

                 STATEMENT OF ELFIDAR ILTEBIR,
             PRESIDENT, UYGHUR AMERICAN ASSOCIATION

    Thank you, Chairman Smith and Co-chair Merkley, and other 
honorable members of the Commission. Thank you for giving me 
the opportunity to speak at this hearing. My name is Elfidar 
Iltebir and I was born in East Turkestan, the Uyghurs' homeland 
where Uyghurs have been living for thousands of years and what 
China now calls the Xinjiang Uyghur Autonomous Region.
    Like many Uyghurs, my family also faced persecution at the 
hands of the Chinese Communist Party. After waging more than 
six decades of repressive assimilationist policies to weaken 
and eliminate the Uyghur identity, the CCP under General 
Secretary Xi decided to implement the final solution and 
resorted to genocide in the 21st century. The CCP's ultimate 
goal is to completely annihilate the Uyghur identity and 
homogenize China's population by forcibly transforming Uyghurs 
into majority Han Chinese. To achieve this goal, the CCP has 
transformed the Uyghurs' homeland into a totalitarian 
surveillance state, detained millions of people in detention 
camps, forced labor camps, and formal prisons, and subjected 
Uyghur people to inhumane conditions including torture, sexual 
abuse, forced sterilization, forced labor, and forced 
separation of families.
    The main point I would like to stress today is that the 
Chinese government's campaign of forced labor is a critical 
part of China's systematic oppression of the Uyghur people and 
ongoing genocide in the Uyghur homeland. The Chinese 
government's forced labor practices are tearing apart the 
fabric of Uyghur society, separating families and displacing 
them from their communities, stripping away their ethnic and 
religious identity, and leading to a reduction in the Uyghur 
population.
    I want to share a quick story of my friend Kalbinur Gheni, 
who now lives around DC. In 2018, her sister Renagul was taken 
to a concentration camp for praying at her father's funeral and 
possessing Muslims' holy book. She was later sentenced to 17 
years in prison and forced to work at the garment factory 
inside the prison. Her children were separated from her family. 
The Chinese government not only detained 12 other members of 
Kalbinur's family and sent them to a camp and later to the 
prisons, it has also been harassing her on U.S. soil for 
speaking out about her detained family members. She received 
threatening messages directly from Chinese police almost every 
week last year.
    Many more members of the community have similar stories of 
loved ones being detained and exploited. This is one reason our 
community fought so hard for the passage of the Uyghur Forced 
Labor Prevention Act and why we continue to fight for its full 
enforcement. On behalf of Uyghur Americans, I'd like to take 
this opportunity to thank Senator Rubio, Senator Merkley, 
Representative Smith, and Representative McGovern for their 
leadership and to many others who were instrumental in passing 
the UFLPA. Thank you for refusing to make Americans complicit 
in China's genocide against Uyghurs and for putting universal 
values of human rights and dignity above economic interest.
    We were overjoyed with the passage of the UFLPA. We 
believed this new law would be a turning point to stopping 
China's genocide. We believed it would be a catalyst for 
greater awareness among businesses of the CCP's atrocities in 
the Uyghur homeland, that it would compel them to investigate 
and cut links to supply chains connected to Uyghur forced labor 
in the Uyghur homeland and across China. However, when I 
recently saw in my neighborhood grocery stores the red dates 
produced by the Bingtuan, which facilitates Uyghur forced 
labor, it felt like a slap in my face.
    As a Uyghur American, every time I shop for clothing items, 
grocery items, or electronics, or when I look at cars or solar 
panels, I think about how many ``Made in China'' products may 
have been made by a loved one in my hometown. The human cost of 
this forced labor is why it is so important to ensure that the 
UFLPA is fully and rigorously implemented the way it is 
intended. As Uyghur Americans, we are prepared to contribute to 
the successful implementation and enforcement of the UFLPA. We 
may not be able to close the camps overnight, reunite our 
families this Ramadan, stop the Chinese government's mass 
sterilization of Uyghur women by the next U.N. session, and 
much more that we need to do to end this genocide, but as I sit 
here today, I can say with confidence that together we can stop 
products made with Uyghur forced labor from entering onto U.S. 
soil and make this genocide costly for China. We can be an 
example for our allies to implement similar laws so ``Made in 
China'' products tainted with Uyghur forced labor cannot enter 
any markets that value human beings and fair trade. If there is 
one thing I can ask of the U.S. Government, it would be to hold 
this Chinese government and affiliated entities accountable by 
imposing economic cost on Chinese officials and companies 
implementing, facilitating, and supporting this genocide.
    The United States passed two pieces of historical 
legislation--the Uyghur Human Rights Policy Act, signed by the 
Trump administration, and the Uyghur Forced Labor Prevention 
Act, signed by the Biden administration. Yet as far as we know, 
no Chinese officials or entity has been sanctioned under these 
legislative authorities. Both administrations recognized 
China's atrocities as genocide. Yet U.S. businesses are still 
operating in the genocide zone, U.S. companies are still 
selling technology to Chinese companies implementing this 
genocide, and U.S. companies are still investing in Chinese 
companies supporting the Chinese government's genocidal 
policies.
    We need to ensure that no American technology or investment 
is flowing to Chinese companies that are linked to China's 
genocide against Uyghurs, and no Chinese products tainted with 
Uyghur forced labor are entering our territory. Thank you.
    Chair Smith. Thank you so very much for your testimony and 
leadership as well.
    We'll begin with a question to Ms. Syam, and Ms. Murphy may 
want to answer this as well. A group of executives from 20 
companies, including Walmart, General Motors, and Intel have 
asked the U.S. Government to hide key import data. One of the 
changes the group requests is to make data collected from 
vessel manifests confidential. Experts have argued that this 
would make it impossible to trace about half of the goods 
entering the United States. The group has also asked CBP to 
provide importers with advance notice whenever it suspects 
forced labor is being used, which activists have said endangers 
overseas whistleblowers. How do you view these proposed 
changes? What impact would they have on CBP's enforcement 
capability and on the ability of researchers, reporters, and 
the public to investigate forced labor in supply chains and to 
hold corporations accountable?
    Ms. Syam. Thank you for the question, Chairman Smith. In a 
nutshell, these proposals should be summarily rejected. Last 
year, the Associated Press reported on items from these 
corporate members of the Commercial Customs Operations Advisory 
Committee, or the CCOAC, where it revealed efforts to 
eviscerate existing customs transparency. And this customs 
transparency, what we have of it is very little. As noted in my 
testimony earlier, we only have access to maritime shipping 
data. And we know thousands and millions of shipments are 
entering the United States subject to both the U.S. Tariff Act 
and the Uyghur Forced Labor Prevention Act through air, land, 
rail, or road cargo.
    We call on Congress to mandate the disclosure of all modes 
of trade data, including all modes of transportation. In fact, 
the Human Trafficking Legal Center led a broad-based coalition 
of civil society organizations and sent a letter to then-CBP 
Commissioner Chris Magnus requesting that the agency reject 
this highly problematic proposal. The letter was signed by 38 
organizations, including the AFL-CIO. The letter noted that the 
trajectory should be for more transparency, not less. This 
information, this trade data from all modes of transportation, 
is critical to our efforts to trace forced labor risks across 
the supply chain.
    Chair Smith. Thank you. Ms. Murphy, did you want to respond 
to that?
    Ms. Murphy. I agree entirely with Ms. Syam.
    Chair Smith. Thank you. Let me ask you, on the de minimis 
issue, Ms. Syam, you pointed out that on average the U.S. 
receives 3 million uninspected de minimis packages per day. And 
in fiscal year 2022, the U.S. imported an estimated $685 
million in de minimis shipments. Is that a gaping loophole that 
needs to be closed?
    Ms. Syam. Thank you, Chairman, again for raising an 
important issue, and a loophole in UFLPA enforcement. This de 
minimis shipping environment is being used to circumvent the 
UFLPA. The Bloomberg report that showed that companies like 
Shein were using Xinjiang cotton in their low-value shipments 
being sent to the United States is a glaring example of this 
loophole.
    We were encouraged by the letter from Senator Warren, 
Senator Cassidy, and Senator Whitehouse addressed to Shein's 
CEO on the de minimis issue and asking the company to reveal 
its supply chain and use of Xinjiang cotton. This is an 
important step, and we look forward to receiving the responses 
on this letter. The de minimis standard cannot be carte blanche 
for companies and for shippers to send whatever goods they want 
to U.S. markets, especially goods made using forced labor.
    Chair Smith. How confident are all of you that the 
applicability review is being done robustly? Are these 
companies able to prove ``not made in Xinjiang'' and ``not made 
with forced labor'' ? Because there's very little exposure of 
it by our own government, and they don't report on it. And I'm 
wondering if that's an area that we need to get much more 
information on.
    Ms. Syam. Definitely. We need more visibility into how 
CBP's currently reviewing applicability reviews. Importers have 
the ability to contest UFLPA's application on their shipments, 
and this is not subject to the disclosure requirements that are 
currently incumbent on those making requests to rebut the 
forced labor presumption.
    So a lot of reviews that are currently happening under the 
UFLPA, thousands of these as the data dashboard will show--are 
showing that the imports have no connection to Xinjiang, and 
they're not really rebutting the forced labor presumption. In 
fact, we need more visibility into these reviews, including how 
many were rejected, what the basis was for conducting these 
reviews, and the standards applied by CBP to conduct these 
reviews.
    Chair Smith. Let me ask you on the issue of transshipment--
and, Mr. Conklin, you might want to speak to this, as you 
pointed out the $490 million from Malaysia, the $369 million 
from Vietnam--are these goods suspected to be made with slave 
labor, with gulag labor? And secondly, you did point out in 
your testimony a number of things--and, again, I thank all of 
you for your testimony--the polysilicon, which is obviously 
being used to make solar panels, which are growing, not 
diminishing, in demand. Are they being made in Vietnam, but 
really much of it's coming from Xinjiang?
    Mr. Conklin. Thank you for your question. Regarding 
transshipment risks, the UFLPA bans that raw material; any 
product that's mined or manufactured in whole or in part in 
Xinjiang or with forced labor. So therefore even if a commodity 
is manufactured in a third country, if it contains that raw 
material, that's representative of risk itself; therefore, it's 
captured under the law as written.
    Chair Smith. I had some additional questions, but I'd like 
to yield to the co-chair, Senator Merkley.
    Co-chair Merkley. Thank you very much, Mr. Chairman. This 
process of trying to strengthen enforcement of this law is 
really critical. You've all illuminated many aspects of it. I 
wanted to start, though, Ms. Iltebir, just with something that 
you mentioned in terms of your friend, Kalbinur Gheni, and her 
sister having been arrested and so forth, and that she is 
receiving threatening messages directly from Chinese police 
almost every week. Now, she's living here in the U.S.?
    Ms. Iltebir. Yes.
    Co-chair Merkley. This issue of transnational repression is 
one that this body's been trying to highlight, and we're trying 
to greatly motivate the FBI to collect a lot more information 
about this Chinese effort, because it's really suppressing free 
speech, free assembly, and just the freedom of living without 
threats. And it's just so unacceptable. I'd like to follow up 
with you later in regard to that or other cases as to how we 
can strengthen the collection of data and protect American 
citizens regarding transnational repression. And I just want to 
thank you for illuminating that issue.
    Mr. Conklin, you mentioned the four priorities of cotton, 
polysilicon, tomatoes, and aluminum, but all these other 
products that come out are relevant as well. Does the U.S. 
Government have the ability to expand the list now, or do they 
kind of have to come up to speed and build the systems and then 
expand the list? And what are the next two or three things that 
should be added to that priority list?
    Mr. Conklin. Thank you for your question, Senator.
    The UFLPA gives CBP the authority to ban any raw material 
or any product. By prioritizing certain commodities for 
enforcement, it may send a signal that all of the other 
commodities are therefore not relevant or do not pose risk. I 
think the challenge that CBP and industry both now are facing 
is how to treat commodities that haven't been publicly 
identified for prioritized enforcement. So if CBP is concerned 
or interested in expanding those authorities, they already have 
the law on the books to detain any commodity, so there may not 
necessarily be a need to publicly prioritize extra commodity 
categories.
    Co-chair Merkley. All right. Thank you. I've had the 
impression that they undertook those priorities in order to 
develop expertise in the type of investigations necessary to 
try to understand how those things flow, and with the huge 
breadth of commodities, I feel like they'd do nothing 
effectively if they were split over every product. So it kind 
of made sense to me originally, but with experience, I think 
the point has to be made that far more products need to be 
carefully examined. Thank you.
    Ms. Syam, you mentioned in your testimony that 1,723 
shipments that were suspected are still pending CBP review. 
Does that mean there's some set of warehouses around the 
country where there are 1,723 shipments sitting awaiting 
evaluation?
    Ms. Syam. It is my understanding that these shipments are 
either pending review from CBP, or that CBP is waiting for 
documentation from companies that have actually sent these 
shipments to see whether they are subject to the Uyghur Forced 
Labor Prevention Act. I'm not clear about the ultimate 
disposition of these goods.
    Co-chair Merkley. But they've been seized. They aren't 
allowed to go through, those 1,723 shipments?
    Ms. Syam. Correct. The shipments that are pending have not 
yet been released into U.S. commerce.
    Co-chair Merkley. Okay. And you mentioned that we should 
make sure that Mexico and Canada are not dumping grounds. And, 
Dr. Murphy, I think you also addressed the question of, you 
know, how we ensure that this isn't simply a bifurcated 
situation where we get the products made outside Xinjiang that 
can be documented, while other countries therefore get the 
products of slave labor. And it sounded like, from--Dr. Murphy, 
I think it was your testimony--that a number of other countries 
are working to establish similar laws. I'd like to get a little 
more clarity on how Mexico, Canada, and Europe are doing. Are 
they just considering the question or are some of them close to 
passing laws?
    Ms. Murphy. There are a number of different laws, each of 
which has very different clauses in them. And Ms. Syam is more 
on top of these things, as she's a lawyer, but I will say that 
the bills that are pending in the EU, for instance, are 
designed to stop import of forced labor-made goods in general 
once they enter the market, not at the border. And so that's a 
difference in their laws that are pending.
    But I also think that one important difference is that it 
addresses forced labor globally, and not simply in the Uyghur 
region. It doesn't include a region-wide ban, which I think is 
something that needs to be a part of that bill, but there's 
also something aspirational about it, in that the law is meant 
to stop the import of any forced labor-made good, which is 
something that the U.S. is uniquely equipped with. And I think 
it's a surprise to people in the EU, for instance, that they 
don't have a law similar to the Tariff Act.
    And so these laws are still being reviewed and discussed, 
and we're hopeful that they'll pass. But it's worrisome. I 
think that the U.S. Government needs to have its diplomatic 
strategy of the UFLPA. Real encouragement, real alignment and 
engagement with our likeminded partners about how to not just 
create the law but how to enforce it, because that's also a 
major concern of other governments.
    Co-chair Merkley. Should the U.S. be holding a meeting of 
the trade ministers and experts from--at least from--at this 
moment, from Canada, Mexico, and Europe, to really push for a 
common alignment in terms of strategy?
    Ms. Murphy. Absolutely. And, you know, the laws are 
aligned, technically, on paper, but the enforcement strategy is 
not. And I think there needs to be significantly more 
communication of both strategy and data and information, 
because it is a monumental task the CBP is undertaking, and 
they could be doing it for the benefit of global partners, not 
simply for the United States.
    Co-chair Merkley. Ms. Syam, do you want to add to that?
    Ms. Syam. Sure, thank you, Senator Merkley. Just to speak 
to the efforts currently underway within the USMCA context, 
Canada amended its customs tariff back in 2020 to include an 
import prohibition, but it's seriously lagging behind on 
enforcement. Media reports suggest that Canada has detained one 
shipment, which was subsequently released after a successful 
appeal by the importer. So we are concerned by the slow 
implementation from our neighbor.
    Mexico, on the other hand, did announce its import ban in 
February 2023 and will begin implementing in May. So the time 
is right for the three countries to convene--the trade 
ministers--to ensure that we are aligned on the ways these 
import bans are going to be enforced, and specifically make 
sure that we take a region-wide approach to the issue of forced 
Uyghur labor. And, under Article 23.6 of the U.S.-Mexico-Canada 
Agreement, all three countries are obligated to identify and 
track the cross-border movement of goods made using forced 
labor.
    Co-chair Merkley. Thank you very much. I just got informed 
the clock is malfunctioning, so my time is actually up, but I 
just want to close by saying that there are many ideas and 
thoughts you all have presented for us to follow up on in terms 
of pushing forward. This Act is a really significant act, but 
it will be meaningless without really effective follow-up, and 
I want to make sure that our government doesn't simply kind of 
pretend to enforce it. And I know they'll face lots of pressure 
from different companies to not take too close a look or be too 
strong.
    But when we are really blocking a significant number of 
shipments--and I was disturbed at how few have been blocked--I 
was disturbed that it sounds like many of them may have simply 
been then re-exported from the United States to other countries 
directly, meaning that we're having no impact, if that's the 
case. So there's a lot of work to be done. And thank you all.
    Chair Smith. Thank you, Co-chair Merkley.
    I'd like to now yield to Michelle Steel. I believe she's 
still online.
    Representative Steel. Thank you, Mr. Chairman. I'm going to 
ask the same question of Ms. Iltebir. I also sit on the China 
subcommittee. I recently spoke with a survivor of the Xinjiang 
region who is now using her platform to raise awareness to the 
world. She shared emotional stories about women being raped and 
experiencing other types of sexual assault. Can you share about 
the living conditions and quality of life for Uyghurs?
    Ms. Iltebir. Thank you. The recent condition of East 
Turkestan, China is that the genocide is still going on. 
Millions of Uyghurs are still in the camps. Because of the 
total control of the region, we don't get much information. 
China made cosmetic changes, you know, like fewer visible 
checkpoints on every corner, but surveillance cameras are 
everywhere, and everyone's phone has downloaded this app that 
allows the government to monitor everything they do daily. 
People are very scared. Most people are sent to remote prisons, 
even though China said that they were released. There is 
extrajudicial trial and the people are sent to prison, as I 
said.
    Besides that, I think you mentioned what's happening to 
women, the sexual abuse and rape. China has been strategically 
targeting Uyghur women for decades. Before, the Uyghurs, 
especially women, were transferred to inner China to factories, 
so they can't give birth. They're away from their families. 
They can't marry. And even if they have children, they were far 
from their families so they cannot transfer their cultural, 
religious values, their identity to their children. When both 
parents were sent to camps and factories for forced labor, 
their children were sent to boarding schools, state-run 
orphanages, and kindergartens and raised as loyal subjects of 
the CCP. They were also stripped of their identity, their 
language, their cultural beliefs, and traditions. So that is 
the situation now.
    Representative Steel. Thank you so much. I want to ask Ms. 
Syam, last year actually I asked all the major sponsors of the 
Beijing Olympics to use their platform to raise awareness about 
the human rights abuse of the CCP, because they've been 
gathering billions of dollars from advertising. They could not 
use just a little bit of that money to let the whole world know 
exactly what the CCP's been doing to the Uyghurs. It's not just 
Uyghur minority communities but religious communities--Muslim, 
Christian, you name it.
    And they're going after all these innocent people. And they 
are in the jails--and labor camps. Plus, all those families are 
separated. I mean, you know, we cannot really ignore in this 
world that they are doing awful, awful things, that the CCP has 
been evil. Not a single company, interestingly, acknowledged my 
letter. Now, some of these same corporations might be trying to 
hide data related to Xinjiang forced labor. Can you share why 
we need transparency to ensure that products coming to the 
market aren't made with forced labor, because it has been 
prohibited? At the same time, what do we really have to do to 
expose what the CCP's been doing?
    Ms. Syam. Thank you for the question. I will try to briefly 
respond, and I'm sure the other witnesses maybe can add more 
insight. There's definitely an urgent need for companies to 
reveal--for us to have more visibility into--supply chains. And 
the UFLPA law is creating that expectation around traceability. 
With the UFLPA implementation strategy, and with CBP's guidance 
for importers, there are clear expectations on companies that 
import products, especially in the high-risk, the high-priority 
sectors, to trace their supply chains down to the raw material.
    Now there are strategies that companies could be using to 
obfuscate their supply chains, and we need to investigate those 
very seriously. For companies in the U.S. that continue to 
tolerate forced labor in supply chains, we need to look at what 
other authorities exist. CBP has existing authorities to impose 
civil penalties on U.S. companies for continuing to import 
products made using forced labor. And CBP did do that once in 
2020 by imposing a $535,000 penalty on a U.S. company for 
importing the artificial sweetener stevia made using prison 
labor in China. We urge the agency to continue imposing these 
penalties, because they send a strong message to industry that 
CBP does not tolerate forced labor in supply chains.
    Representative Steel. Thank you very much. Mr. Chairman, I 
yield back.
    Chair Smith. Thank you very much, Ms. Steel.
    Ms. Wexton.
    Representative Wexton. Thank you, Mr. Chairman. I want to 
thank the witnesses for being here with us today. Products made 
with forced labor have no place in the American marketplace, 
and I'm proud to be introducing the Uyghur Forced Labor 
Disclosure Act during this Congress. My bill would require 
publicly traded companies and those asking to issue trade 
securities on the U.S. exchanges to report any links to 
Xinjiang and forced labor, both as a condition of being 
registered and as a part of ongoing annual disclosures to 
investors.
    In line with this legislation, and given the credible 
allegations made against Shein for its use of Uyghur and forced 
labor, and its intention to execute an IPO in the coming 
months, I also plan to lead a letter to SEC requesting that 
they require Shein to certify the company does not violate the 
Uyghur Forced Labor Prevention Act as a condition of its 
registration. At the same time, concerns exist that the audits 
of Chinese families and supply chains can be easily manipulated 
or falsified.
    Ms. Syam, you talked a little bit about more things that we 
can do to help identify Uyghur forced labor in supply chains, 
particularly CCP-backed companies. But is there more that we 
can do, given that the audits that often take place in that 
country are under pressure and are not really reliable?
    Ms. Syam. Thank you for that question. That's a very 
important point. We certainly believe that it is impossible to 
conduct due diligence in the Uyghur region. And there has been 
retaliation for those that attempt to do so. Thank you for your 
efforts on investment and making sure that U.S. companies are 
not complicit. We do need to compel divestment from these 
problematic supply chains.
    And as noted in my testimony, and as Ms. Iltebir noted 
earlier, we do need to have a whole-of-government approach to 
addressing this issue. And there are tools that are 
complementary to the import restrictions under the Uyghur 
Forced Labor Prevention Act and the Tariff Act, including the 
economic sanctions or Magnitsky sanctions, as well as the 
export controls from the Department of Commerce. So I encourage 
a whole-of-government approach and the use of these 
complementary tools.
    Representative Wexton. Anybody else have any suggestions 
about other things we can do in order to combat this use of 
forced labor?
    Ms. Iltebir. I think there should be a cost for China. We 
need to impose cost penalties for the willful violations of 
this law. And also, I believe we should reduce the de minimis 
rule so China can't continue to profit from the genocide, from 
the Uyghur forced labor. Bingtuan products, for example, are 
still on the shelves. And UHRP's report showed, you know, all 
the linked companies to Uyghur forced labor. Those companies 
should be sanctioned. The companies that do business with 
Bingtuan should be sanctioned.
    Representative Wexton. Very good segue there, because I 
wanted to ask about the loopholes in the de minimis rule and 
the way that they can get around the rules, and particularly as 
it relates to CCP-controlled companies, like Shein. They may be 
head-
quartered in Singapore or elsewhere, but these companies 
control an enormous share of the U.S. market. Should Congress 
require the CBP to collect more information on the de minimis 
shipment?
    Ms. Iltebir. For the de minimis rules, I think Ms. Syam or 
Laura Murphy is more expert on this. But we know that China is 
taking advantage of this rule and separating their shipments 
into smaller amounts, and still, you know, sending, and we are 
receiving, those deliveries.
    Representative Wexton. Dr. Murphy, do you think that 
there's a way to crack down on de minimis shipments and maybe 
to also aggregate them in some way for other consumers?
    Ms. Murphy. I do think that more data and more accurate 
data should be required for de minimis shipments. But I welcome 
the disclosure legislation that you're describing here. And I 
also share Congresswoman Steel's concern that companies are not 
willing to be more public about their ethical commitments. 
They're more concerned about the retaliation of the Chinese 
government than they are about the moral outrage or even the 
penalties in the United States.
    And so it's clear that we need some kind of penalty regime 
within the UFLPA that makes it more costly to not comply with 
the UFLPA than it is to just stick your head in the sand and 
hope you don't get enforced against, which is what is 
essentially happening now, whether it's for de minimis 
packages, companies that are operating through that mechanism, 
or for other companies that are at the moment not receiving a 
ton of scrutiny just yet.
    I'd also say that creating more funding for the creation of 
the Entities List, for the expansion of the Entities List, 
would be important. This is something that Congress could do. 
And I also think that adding priority sectors, as we discussed 
earlier, could be a route to informing the import community of 
additional high-priority sectors that the Chinese government 
has incentivized moving out to the Uyghur region.
    We don't have to guess what the Uyghur region is producing. 
We don't have to say that it's every single thing that's coming 
in that we have to inspect. In fact, the Chinese government 
produces annual and every-five-year directives telling the 
Uyghur region government what to produce and gives incentives 
to companies to move out to the region.
    And so we know that, for instance, critical minerals are 
high on their list, steel and aluminum are high on their list. 
And these are critical to our infrastructure and to the 
creation of practically every product that we make. Cotton is 
not the only textile that they're making there, but they're 
making viscose and all kinds of synthetic polyester, these 
kinds of things. So we can name those products as priority 
sectors, the ones that we know the Chinese government is 
incentivizing in the Uyghur region. So these are some of the 
things that we can do to sort of make the UFLPA enforcement 
more robust.
    Representative Wexton. And that's why the whole burden 
shifting--putting it on the producer to prove that it's not the 
product of forced labor--is so important in the Uyghur Forced 
Labor Prevention Act, isn't it?
    Ms. Iltebir. I would like to add to that that a secondary 
sanction bill should be introduced--reintroduced, because that 
is, we believe, going to fix the loopholes and the gaps of the 
first bill.
    Representative Wexton. One of the things that's so 
disturbing about this is that not only the Chinese companies 
but the U.S. companies kind of view it as the cost of doing 
business, right? So as long as they can make more money, 
they're perfectly content to look the other way on forced 
labor. That shouldn't be happening in this country at all.
    Mr. Conklin, is there anything else that we can do at CBP 
to improve the way that we're enforcing the law?
    Mr. Conklin. I think the comments about a whole-of-
government approach to the UFLPA and to forced labor are spot 
on. You have a whole variety of other government agencies that 
have a history with export controls, sanctions; there's 
guidance and all sorts of good policies that have come out that 
could be applied for this context. But I think the ideas posed 
by others on the panel are perhaps the way to start.
    Representative Wexton. Thank you very much. Mr. Chairman, I 
see my time is expired and I yield back.
    Chair Smith. Thank you very much, Ms. Wexton.
    I'd like to just ask one or two final questions, and then 
if you have any additional questions, Ms. Wexton, I'd gladly 
yield, or Ms. Steel.
    First, the whole idea of the de minimis being $800. As you 
pointed out, Ms. Syam, 3 million uninspected de minimis 
packages per day. I mean, who even knows if those packages are 
$800, or $2,000, or $1,500? Who knows? I mean, they're 
uninspected. When did the number get raised to--I mean, who set 
$800 as a de minimis number? Was it done by administrative? I 
don't recall it being in the bill. Yeah, OK, my understanding 
is that it used to be $200, and now it's been raised. I mean, 
$800 is a lot of money. But it's uninspected, so it could be 
much more. How do we rein that in?
    Ms. Syam. Thank you, Chairman Smith, for your interest in 
this topic. I think we do need to pay attention to what data 
points we can collect from de minimis shippers and also closely 
scrutinize this de minimis shipping environment. Right now, CBP 
is piloting an 86-type entry commercial entry process as part 
of its customs enforcement. But this is a voluntary measure. 
Companies can choose not to follow and disclose details of 
their supply chain. So we need to make collection of certain 
specific data points, including country of origin, value, the 
tariff, DHS classification, part and parcel of the de minimis 
shipping environment.
    Chair Smith. How big are these packages? I mean, we know 
that we couldn't stop fentanyl coming in for years. It's still 
coming in, obviously, in huge amounts. Who's even looking?
    Ms. Syam. Yes, that is a big concern. A lot of these 
packages, as I mentioned earlier in my testimony, could be 
coming by mail, through express courier services. And one 
strategy to circumvent this could also be to break down bigger 
packages into shipments under $800, into many shipments. And 
this is what we are concerned that companies are doing to 
circumvent the law.
    Chair Smith. Right. I would hope that CBP would at least 
take an aggressive look at some of this to find out whether or 
not we're all being duped, and that all kinds of goods are 
coming in illegally, made with slave labor and forced labor, 
and right under our nose. So this is an area we really need to 
focus on, I think, big time.
    Let me ask you, Ms. Murphy, you said that your research 
team has identified 5,500 companies operating in the Uyghur 
region. In your opinion, should they all--or most--be placed on 
the Entity List? And if not, what is the best approach for 
using the Entity List as a tool and a signal?
    Ms. Murphy. Thank you for that. Yes, we've identified 
55,000 companies operating in the Uyghur region.
    Chair Smith. Sorry.
    Ms. Murphy. Thirty-three hundred in the textile industry 
alone. We have this data. We've shared this data with U.S. 
Government agencies, various agencies. And I think that 
probably ideally I would like to see all 55,000 companies that 
are operating in the Uyghur region named in the Entity List 
because if we presume that forced labor dominates the region 
under the UFLPA, we're presuming that all companies that 
operate in the region should be having their goods stopped, and 
therefore they should be added to the Entity List.
    It has been suggested to me that this is a lot of companies 
to add to the list, but I have some ideas for how we might 
start to add companies to the list in a way that is robust and 
vigorous but also gives companies enough information to be able 
to begin to exclude the suppliers that we know are the worst 
actors. The FLETF can start by adding companies that are state-
owned operations that have been instrumental in the development 
of the labor transfer programs.
    Some of these companies have transferred 5,000 people to 
their own facilities alone. Some of these state-owned 
enterprises have run training centers that they call 
universities that are closed, they're locked down. People are 
not allowed to leave. And then those people are summarily 
transferred to factories all over the region. These companies 
are egregiously bad actors, and they are not on our Entities 
List. And we have this information. It is my suspicion, based 
on media reports about what's getting stopped, that CBP is in 
fact stopping goods made by some of these companies, but 
importers don't know necessarily who those companies are, and 
they could know if they were added to the Entity List.
    It's also possible to add all of the textile companies that 
we know to be operating in that region, because then companies 
could then link them to--or importers could link them to--their 
parent companies so that they can pressure the parent companies 
to move out of the Uyghur region, to stop sourcing from the 
Uyghur region. Otherwise, importers don't actually know who 
these companies are that are most connected to the Uyghur 
region and are sourcing from there. There are companies that 
are named that are engaged in the critical minerals sector, in 
the automotive sector, that we know to be actively involved and 
to have an import nexus to the United States. Those companies 
should absolutely be added to the UFLPA Entity List as well.
    It wouldn't take that long, because civil society has 
produced significant research really unpacking all of the 
evidence that is out there. And many groups like mine have 
handed this data over to the U.S. Government, and we publish 
reports about them. And so there's more than enough information 
in the public sphere now to really vigorously add more 
companies to the Entity List, to be a signal to the Uyghur 
community and to advocacy groups that the UFLPA Entity List is 
being taken seriously, but also to show the import community 
where they can begin the process of eliminating forced labor-
made goods.
    Chair Smith. Thank you so very much for that excellent 
answer and recommendation.
    Let me ask Mr. Conklin, should all fast-fashion goods from 
Temu be subject to a rebuttable presumption? And should the app 
be banned because of privacy concerns, like TikTok?
    Mr. Conklin. Thanks for your question. I don't know the 
data piece with Temu, so I'm not really in a position to 
provide too much guidance on that, but with respect to what 
products should be banned from importation into the United 
States, I would just note that regardless of what the company 
is, regardless of how much the shipment costs, there is a law 
on the books that bans all products manufactured in whole or in 
part with forced labor. So if a company or a supply chain is 
tainted with that, then the law should, I believe, apply.
    Chair Smith. Before we close, if you have any final 
comments you'd like to make, any of our distinguished 
witnesses, or Ms. Wexton, or Ms. Steel?
    I do want to point out that yesterday I sent a letter to 
Chairman Xi Jinping asking to visit the Uyghur region. I based 
it on an email a diplomat in the Chinese embassy here in 
Washington sent to my office after the legislation, the Stop 
Forced Organ Harvesting Act, passed, which was my bill. And I 
spoke very strongly on the floor about it. And I think it's an 
outrage beyond words that they are murdering young Uyghur men 
and women, average age 28, in order to steal their organs, one 
to three per person.
    And this Minister-Counselor for Congressional Affairs in 
Washington, Zhou Zheng, stated--and this is his quote from the 
email--``China fully protects the rights and interests of all 
ethnic minorities, including Uyghurs in Xinjiang, and the 
living standards and human rights protections of all ethnic 
groups continue to improve.'' I wrote and said I'd like to lead 
a delegation there and get a visa to go there. Hopefully we can 
get a week or 10 days to really do a full-scale trip there.
    And I am especially buoyed by the hope--the Chinese Foreign 
Ministry spokesperson welcomed foreigners to visit Xinjiang to 
``see with their own eyes.'' He was asked in a March 27th press 
conference if China would be willing to provide a U.S. 
congressional delegation to the region. And he said the door to 
Xinjiang is always open and that people from all countries are 
welcome to visit. And so in my capacity as chairman, I've 
written to Xi Jinping asking him to approve that visit. So stay 
tuned.
    My hope is that it will be approved. It would be a very 
serious, serious undertaking. I hope that we would have 
unfettered access to the camps and to talk to officials there 
and, above all, to talk to individual Uyghurs without any fear 
of retaliation. And there is precedent for that that I've 
worked on in the past, where you get prior approval with regard 
to that. But to see for ourselves--they're saying they have 
nothing to hide; well, let us come and we'll pick dates when 
we're not in session, and my colleagues and I will travel 
there. So hopefully that comes to fruition.
    And so if any of you have any final comments before we 
close? Well, thank you so very, very much for your insight, 
your written testimony, and your oral presentations were 
extraordinary. And it really does help us significantly in 
providing a path forward as to what our next steps should be. 
We're deeply, deeply grateful. The hearing is adjourned.
    [Whereupon, at 11:41 a.m., the hearing was concluded.]

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                         A  P  P  E  N  D  I  X

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                          Prepared Statements

                                 ______
                                 

                   Prepared Statement of Anasuya Syam

    Chairman Smith, Co-Chair Merkley, and Members of the CECC: It is an 
honor to testify today before the Congressional-Executive Commission on 
China (CECC), and address the implementation of the Uyghur Forced Labor 
Prevention Act (UFLPA), which entered into force nearly ten months ago. 
My name is Anasuya Syam, and I serve as the Human Rights and Trade 
Policy Director at the Human Trafficking Legal Center, a non-profit 
organization that fights for systems change to end human trafficking. 
Addressing forced labor in global supply chains is central to our 
mission. The organization works to shine a light on the system failures 
that allow forced labor to flourish. We fight for accountability from 
traffickers, from governments, and from corporations.
    Since 2019, the Human Trafficking Legal Center has been raising 
awareness \1\ on the role trade law and policy--specifically import 
prohibitions--can play in creating financial and legal consequences for 
companies and governments that tolerate forced labor. Civil society 
organizations have made common cause to press for robust enforcement of 
import controls under Section 307 of the U.S. Tariff Act of 1930, as 
well as under the Uyghur Forced Labor Prevention Act (UFLPA). Import 
bans send a strong signal to industry and--in the case of state-imposed 
forced labor like in Xinjiang--governments, that they simply cannot 
profit from forced labor. In 2020, the Human Trafficking Legal Center, 
in partnership with nine other organizations, filed a petition \2\ with 
U.S. Customs and Border Protection (CBP) requesting a region-wide 
import ban (a Withhold Release Order or WRO) on cotton products from 
Xinjiang (``Uyghur Region''). CBP responded by issuing a WRO \3\ 
against Xinjiang cotton and cotton products in January 2021, one of the 
broadest import prohibitions against forced labor ever issued (before 
the UFLPA).
---------------------------------------------------------------------------
    \1\ https://htlegalcenter.org/sdm--downloads/importing-freedom-
using-the-u-s-tariff-act-to-
combat-forced-lab or-in-supply-chains/
    \2\ https://investorsforhumanrights.org/news/human-rights-groups-
call-us-regional-ban-imports-china-made-uyghur-forced-labor
    \3\ https://www.cbp.gov/newsroom/national-media-release/cbp-issues-
region-wide-withhold-
release-order-products-made-slave
---------------------------------------------------------------------------
    Multiple coalitions support aggressive enforcement of Section 307 
and UFLPA. The Human Trafficking Legal Center serves as the Secretariat 
for the Tariff Act Advisory Group (TAAG), a coalition of non-
governmental organizations dedicated to enforcement of import bans 
against forced labor. The organization is also a member of the 
Coalition to End Forced Labour in the Uyghur Region, \4\ a group of 60+ 
civil society organizations, investors, and trade unions united to end 
state-sponsored forced labor and other egregious human rights abuses 
against people from the Uyghur Region in China.
---------------------------------------------------------------------------
    \4\ https://enduyghurforcedlabour.org/
---------------------------------------------------------------------------
    Companies have been on notice about forced labor in the Uyghur 
region from the time the first Withhold Release Orders (WROs) against 
the region were issued by U.S. Customs and Border Protection (CBP) in 
2019, \5\ if not before. That was four years ago. There is a mountain 
of evidence, publicly available, on the PRC's forced labor policies in 
the Uyghur region. Even today, many Uyghurs, Kazakhs, and members of 
other ethnic groups continue to be arbitrarily detained and held in 
forced labor in Xinjiang and elsewhere in China.\6\ Less than a month 
ago, two courageous survivors of Chinese detention camps provided 
first-hand testimony to a House panel, about the abusive prison-like 
conditions and forced ``re-education'' they suffered in Xinjiang.\7\
---------------------------------------------------------------------------
    \5\ https://www.cbp.gov/newsroom/national-media-release/cbp-issues-
detention-orders-against-companies-suspected-using-forced
    \6\ https://www.dol.gov/agencies/ilab/against-their-will-the-
situation-in-xinjiang
    \7\ https://www.washingtonpost.com/opinions/2023/04/09/uyghur-
camps-china-gulbahar-haitiwaji/
---------------------------------------------------------------------------
    Many Uyghurs and other Turkic and/or Muslim-majority peoples are 
coerced into producing textiles, electronics, car parts, toys, solar 
panels, polyvinyl chloride (PVC), and other products for domestic and 
global consumption. Recent reports from the Sheffield Hallam University 
\8\ reveal hundreds of global brands that are implicated in forced 
Uyghur labor. My fellow witnesses testifying on this panel today will 
cover the details of the policies in Xinjiang and the supply chains 
that are implicated. My remarks will focus on the implementation of the 
Uyghur Forced Labor Prevention Act (UFLPA).
---------------------------------------------------------------------------
    \8\ https://www.shu.ac.uk/helena-kennedy-centre-international-
justice/research-and-projects/all-projects/forced-labour-lab
---------------------------------------------------------------------------
    UFLPA is a powerful tool to confront a significant problem: 
preventing goods made with Uyghur forced labor from entering the U.S. 
market. No one should reap profits on the backs of forced Uyghur labor. 
Allowing goods made using forced labor to circulate freely in global 
markets is not only morally reprehensible, it also significantly 
undermines fair trade and hurts local businesses and workers. 
Governments, policy makers, companies, civil society groups, and other 
stakeholders have a collective responsibility to ensure that we do not 
continue to be implicated in forced labor. Uyghurs and other persecuted 
groups deserve better. Consumers deserve better. As one of the world's 
largest economies, the United States has significant economic leverage 
and influence to push companies to eliminate forced labor in their 
supply chains, or risk losing access to U.S. markets.
    We are very encouraged by the U.S. Government's continued 
commitment to prioritize forced labor and the enforcement of import 
prohibitions. The inter-agency Forced Labor Enforcement Task Force 
(FLETF)'s release of the UFLPA implementation strategy \9\ on June 17, 
2022, was an important first step. That strategy provided a blueprint 
for the law's enforcement and created expectations around traceability. 
There is no doubt that the UFLPA is already making waves in global 
supply chains and changing business practices.
---------------------------------------------------------------------------
    \9\ https://www.dhs.gov/uflpa-strategy
---------------------------------------------------------------------------
    These changes are a direct result of CBP's enforcement actions at 
U.S. ports--through shipment inspections, detentions, and seizures of 
goods made with forced labor. According to official data recently 
published, \10\ between June 2022 and April 2023, U.S. Customs and 
Border Protection (CBP) stopped more than 3,588 shipments with 
suspected links to Xinjiang at U.S. ports of entry. However, only a 
small percentage (less than 13%) of these shipments were denied entry 
into U.S. commerce.
---------------------------------------------------------------------------
    \10\ https://www.cbp.gov/newsroom/stats/trade/uyghur-forced-labor-
prevention-act-statistics
---------------------------------------------------------------------------
    In a letter addressed to Department of Homeland Security (DHS) 
Under Secretary Robert Silvers a few weeks ago, members of this 
Commission, including Representative Smith and Senator Merkley, 
highlighted a few gaps in UFLPA implementation.\11\ We agree that more 
can be done. I'd like to address the impact of the UFLPA and outline a 
few specific challenges. These include gaps in UFLPA enforcement based 
on insights from recently published data, the issue of low-value 
shipments evading customs scrutiny, the need for more trade data 
transparency, and finally, the importance of pushing our international 
allies to adopt similar region-wide bans to address the forced labor 
situation in Xinjiang.
---------------------------------------------------------------------------
    \11\ https://www.nationalreview.com/wp-content/uploads/2023/04/
UFLPA-Implementation-Letter-to-FLETF.pdf
---------------------------------------------------------------------------
    From the perspective of the Human Trafficking Legal Center, a good 
indicator of progress is in the way enforcement (both under prior 
Xinjiang WROs and the UFLPA) has catapulted forced labor into a serious 
compliance issue for companies and investors. Never before has forced 
labor achieved this level of attention from the C-suite. In September 
2022, DHS Under Secretary and FLETF chair Robert Silvers, in an 
interview with the Wall Street Journal, \12\ underscored this change in 
the way forced labor is being perceived by corporate management. 
According to Under Secretary Silvers, ``[F]orced labor belongs in the 
same breath as Foreign Corrupt Practices Act (FCPA).'' We agree. The 
message from the top is clear--forced labor is a ``top tier'' 
compliance issue. It is no longer the provenance of weak Codes of 
Conduct or Corporate Social Responsibility (CSR) measures. What 
changed? The advent of substantial enforcement risk.
---------------------------------------------------------------------------
    \12\ https://www.wsj.com/articles/forced-labor-a-top-tier-
compliance-issue-says-u-s-official-11664271003
---------------------------------------------------------------------------
    In CBP's latest ``Trade News Snapshot'' publication, CBP Executive 
Assistant Commissioner (EAC) AnnMarie Highsmith noted that businesses 
are shifting their supply chain practices in order to retain access to 
the U.S. market.\13\ Corporations are developing compliance and due 
diligence programs to ensure their supply chains are free of forced 
labor.
---------------------------------------------------------------------------
    \13\ https://www.cbp.gov/trade/snapshot/volume-5-issue-2
---------------------------------------------------------------------------
    While we still have a long way to go to achieve FCPA anti-bribery 
levels of compliance, forced labor is now getting more traction from 
senior management, as well as from investors. Beyond reputational 
damage, there are significant financial and legal risks for companies 
that profit from forced labor. Slowly, but surely, we are raising the 
stakes for offending companies. But this progress is predicated on 
robust enforcement of the UFLPA. As Scott Nova, Executive Director of 
the Worker Rights Consortium (WRC), noted in his testimony before the 
Senate Finance Committee last month, the cost (for companies) of 
failing to perform due diligence should be higher than the cost of 
performing it.\14\ According to Mr. Nova, only when we enforce the law, 
that is, when importers with forced labor in their supply chains are 
caught, and financial consequences are imposed, will they feel the 
pressure to perform adequate due diligence that prevents the use of 
forced labor.
---------------------------------------------------------------------------
    \14\ https://www.finance.senate.gov/hearings/ending-trade-that-
cheats-american-workers-by-
modernizing-trade-laws-and-enforcement-fighting-forced-labor-
eliminating-counterfeits-and-
leveling-the-playing-field
---------------------------------------------------------------------------
    The Human Trafficking Legal Center and our partners welcome the 
Biden Administration's efforts to enforce UFLPA. But challenges remain.
            insights from cbp's new uflpa ``data dashboard''
    CBP recently released a long-anticipated ``data dashboard'' \15\ 
with UFLPA enforcement statistics from June 21, 2022. The release of 
the dashboard is an important step in the direction of UFLPA 
enforcement transparency. We commend the agency for making this 
disaggregated data available. However, insights from this dashboard 
raise a few concerns around enforcement.
---------------------------------------------------------------------------
    \15\ https://www.cbp.gov/newsroom/stats/trade/uyghur-forced-labor-
prevention-act-statistics
---------------------------------------------------------------------------
    Over $3 trillion in imports have entered the United States since 
the UFLPA went into effect.\16\ CBP has reviewed only about $1 billion 
worth of imports: 0.03% of the total. Although it would appear that CBP 
has targeted--that is either examined, denied entry, or released--more 
than 3,588 shipments valued at $1.07 billion in the last ten months, 
only 490 (13%) of these shipments were actually denied entry into the 
U.S. market. In general, we are concerned by the low number of 
shipments denied entry into the United States.
---------------------------------------------------------------------------
    \16\ https://www.bea.gov/news/2023/us-international-trade-goods-
and-services-december-and-
annual-2022#::text=increased%20%2424.3%20billion
---------------------------------------------------------------------------
    Of the total 3,588 shipments stopped at port, CBP released more 
than 1,323 shipments into U.S. commerce after reviewing their 
admissibility. There are 1,778 shipments valued at 541 million USD 
still pending review. Apparel, footwear, and textile products valued at 
just $3 million make up 291 of the 490 shipments denied entry by CBP 
since June, 2022. These low shipment numbers--and low dollar value--of 
apparel shipment detentions are also concerning, especially since this 
sector is prioritized in the UFLPA implementation strategy.
    The UFLPA implementation strategy \17\ notes that CBP will 
``prioritize illegally transshipped goods with inputs from Xinjiang.'' 
While a few apparel shipments from Vietnam and China have been caught 
in the enforcement net, CBP does not seem to be scrutinizing a 
significant number of apparel, textile, or footwear shipments from 
major exporting countries like Bangladesh, Indonesia, Pakistan, and 
Cambodia, all of which have historically used substantial Chinese-made 
cloth in their textile production. This is just one example. We are 
worried that CBP may be missing shipments--illegally transshipped or 
otherwise--containing inputs from Xinjiang that could be entering the 
United States from other countries. Transshipment is certainly a big 
challenge for CBP. The agency should have a specific strategy to 
address the issue of transshipment of Xinjiang-origin goods via third 
countries, a critical element of which must be a robust program of on-
site, third country verifications of the provenance of potentially 
transshipped goods.
---------------------------------------------------------------------------
    \17\ https://www.dhs.gov/sites/default/files/2022-06/
22_0617_fletf_uflpa-strategy.pdf
---------------------------------------------------------------------------
    The dashboard tells us that electronics shipments constitute a 
majority of CBP's enforcement actions under the UFLPA since June 2022. 
CBP defines ``electronics'' to include solar products, information 
technology, integrated circuits, automated data processing equipment, 
and consumer electronics. However, in the last few months, a staggering 
third of these shipments were released into the U.S. markets by 
CBP.\18\ Only 22 electronics shipments were denied entry since the 
UFLPA law entered into force. Since solar is designated as a high-
priority sector for enforcement, we need more clarity on what 
percentage of electronics shipments reviewed by CBP are solar panels or 
modules versus others. This is an important data point because we know 
that more than 45% of the world's supply of solar-grade polysilicon 
comes from Xinjiang.\19\
---------------------------------------------------------------------------
    \18\ https://www.reuters.com/world/us/us-releases-third-
electronics-detained-under-china-forced-labor-law-data-shows-2023-03-
14/
    \19\ https://www.shu.ac.uk/helena-kennedy-centre-international-
justice/research-and-projects/all-projects/in-broad-daylight
---------------------------------------------------------------------------
    Another big gap is in the data around re-exportation. According to 
CBP's data dictionary \20\ the term ``denied entry'', could mean 
several different things: the term includes shipments that were either 
seized, excluded, exported, or destroyed. Of the 490 shipments denied 
entry since June 2022 we do not know how many shipments were simply re-
exported to Canada, Mexico, or another country. We need to ensure that 
other countries--including Canada and Mexico, which are subject to the 
forced labor provisions of the USMCA--are not ``dumping grounds'' for 
goods refused entry by CBP for being made with forced labor. Re-
exportation data is critical for civil society groups as we support 
international partners in advocating for similar import bans in other 
countries.
---------------------------------------------------------------------------
    \20\ https://www.cbp.gov/document/stats/uyghur-forced-labor-
prevention-act-data-dictionary
---------------------------------------------------------------------------
    According to the UFLPA implementation strategy, CBP is taking a 
``risk-based approach, dynamic in nature, that prioritizes the highest-
risk goods based on current data and intelligence. Currently the 
highest-risk goods include those imported directly from Xinjiang into 
the United States and from entities on the UFLPA Entity List.'' We know 
that direct exports from Xinjiang have dropped significantly and that 
the current list of companies on the Entity List \21\ is very thin. We 
urge the agency to expand its enforcement efforts by increasing the 
number of highest-risk goods and adding more entities to the UFLPA 
Entity List.
---------------------------------------------------------------------------
    \21\ https://www.dhs.gov/uflpa-entity-list
---------------------------------------------------------------------------
            cbp's uflpa applicability review determinations
    The Uyghur Forced Labor Prevention Act created a rebuttable 
presumption that goods made wholly or in part in Xinjiang or goods 
involving a company on the UFLPA Entity list are made with forced 
labor. This presumption may only be refuted with ``clear and convincing 
evidence'', a fairly high evidentiary threshold. Naturally, only a 
handful of importers have even attempted to rebut the presumption and 
meet the high burden of proof. Under the UFLPA, importers can also 
contest in ``applicability reviews'' whether the rebuttable presumption 
even applies to their shipments, by maintaining that they have no 
connections to Xinjiang. It appears that the burden of proof applied by 
CBP in such reviews is much less than ``clear and convincing 
evidence.'' This is precisely the route that hundreds of companies are 
taking, according to CBP.
    We know from the UFLPA data dashboard that at least 1,778 shipments 
are currently being examined by CBP under the UFLPA, and have been 
classified as ``pending''--which could either mean ``shipments pending 
importer action such as providing documentation to support 
applicability or exception review or pending CBP review/decision.'' 
Many of these shipments are ostensibly mired in UFLPA applicability 
reviews. If the importer is successful in such a review, CBP will 
release the importer's goods into the U.S. market. In the last 10 
months, CBP has released at least 1,323 of the total 3,588 shipments it 
had identified as being potentially subject to the UFLPA.
    Only successful rebuttals of the forced labor presumption have to 
be made public and reported to Congress under Section 3(c) of the 
UFLPA. CBP's applicability review determinations are not subject to 
similar disclosures. In this information vacuum, it is important that 
CBP share details, at least in the aggregate, of how many applicability 
reviews it has conducted. It is important to have visibility into how 
many applicability reviews were successful or rejected, as well as the 
types of documents importers are submitting to demonstrate that their 
goods are not touched by Xinjiang or by companies on the Entity List. 
CBP should also explain the standards under which these reviews are 
conducted.
              the issue of low value direct-to-consumer or
              de minimis packages evading customs scrutiny
    De minimis shipments refer to goods that are imported into the 
United States and are exempt from certain taxes and duties because 
their value falls below a certain threshold. Currently, the de minimis 
threshold for the U.S. is $800. These are typically direct-to-consumer 
shipments that receive almost no customs scrutiny or inspection. Under 
current practice, de minimis shipments may enter the United States 
without formal entry documentation, which impedes the collection of 
information necessary to enforce U.S. law prohibiting the import of 
goods made with forced labor. CBP is conducting a voluntary test of a 
de minimis commercial entry process through the creation of the new 
Entry Type 86, \22\ which provides additional information to CBP that 
can be useful for enforcement purposes. The Type 86 process should 
therefore be made mandatory to the maximum feasible extent.
---------------------------------------------------------------------------
    \22\ https://www.cbp.gov/trade/trade-enforcement/tftea/section-321-
programs
---------------------------------------------------------------------------
    A strategy for circumventing enforcement of the UFLPA might be to 
break up a shipment that is clearly subject to all reporting 
requirements into multiple de minimis packages. And companies are doing 
just that. On November 20, 2022, Bloomberg reported that Xinjiang 
cotton was found in apparel shipped by fast fashion giant Shein to U.S. 
consumers, based on the results of a laboratory test.\23\ This 
confirmed what many had long suspected. The expose prompted a letter 
\24\ addressed to Shein's CEO from Sen. Warren, Sen. Cassidy, and Sen. 
Whitehouse, demanding the company reveal details about its supply chain 
ties to Xinjiang and use of de minimis shipments.
---------------------------------------------------------------------------
    \23\ https://www.bloomberg.com/news/features/2022-11-21/shein-s-
cotton-clothes-tied-to-xinjiang-china-region-accused-of-forced-
labor#xj4y7vzkg
    \24\ https://www.cassidy.senate.gov/newsroom/press-releases/
cassidy-warren-whitehouse-press-shein-on-connection-to-chinese-slave-
labor-supply-chains
---------------------------------------------------------------------------
    On average, the United States receives three million uninspected de 
minimis packages per day.\25\ In FY22, the United States imported an 
estimated $685 million in de minimis shipments.\26\ The U.S. de minimis 
threshold is one of the highest in the world.\27\ There are many other 
companies with similar direct-to-consumer business models that may be 
implicated in Xinjiang forced labor. We urge the agency to conduct 
``spot checks'' on de minimis packages from companies like Shein at all 
U.S. ports of entry and begin detaining such packages for potentially 
violating the UFLPA. This will send a strong message to direct-to-
consumer platforms that the de minimis provision is not a carte blanche 
for companies to send goods made using forced labor into U.S markets.
---------------------------------------------------------------------------
    \25\ https://www.forbes.com/sites/kenrapoza/2023/02/19/how-a-us-
trade-loophole-called-de-
minimis-is-chinas-free-trade-deal/?sh=50fcb09d4c9b
    \26\ https://www.cbp.gov/newsroom/stats/trade
    \27\ https://prosperousamerica.org/the-trade-deficit-is-worse-than-
we-thought-de-minimis-hides-128-billion-of-u-s-imports/
---------------------------------------------------------------------------
    There is an urgent need to monitor the de minimis shipping 
environment and ensure that it is not exploited as a backchannel entry 
for goods made using forced Uyghur labor.
            need for more public disclosure of trade data--
                  including air, rail, and road cargo
    Last fall, three months after the UFLPA entered into force, the 
Associated Press reported on a corporate ploy to hide shipping manifest 
data from the public.\28\ Public disclosure of import/export data is 
critical to tracing and monitoring forced labor risks in supply chains. 
This data is especially crucial for civil society organizations, which 
conduct investigations to petition CBP to enforce import prohibitions. 
A leaked proposal from a few corporate members of the Commercial 
Customs Operations Advisory Committee (COAC) revealed efforts to 
eviscerate existing customs transparency.
---------------------------------------------------------------------------
    \28\ https://apnews.com/article/business-global-trade-regulation-
us-customs-and-border-
protection-c878caa703150f417342c9777504b9a1
---------------------------------------------------------------------------
    Rapid mobilization by civil society groups thwarted these efforts. 
A broad-based coalition of civil society organizations sent a letter 
\29\ to the CBP Commissioner requesting that the agency summarily 
reject this highly problematic COAC proposal. The letter was signed by 
38 organizations, including the AFL-CIO. The letter noted that the 
trajectory should be for more customs transparency, not less. Trade 
data transparency is already far too limited. Currently, U.S. federal 
law (19 U.S.C.
 Sec.  1431) provides for public access only to ocean freight data. 
Data on air and land cargo is still not accessible to the public. 
Moreover, U.S. law already grants both importers and shippers the right 
to request confidentiality of their data on a case-by-case basis (19 
C.F.R. Sec.  103.31).
---------------------------------------------------------------------------
    \29\ https://htlegalcenter.org/wp-content/uploads/Open-Letter-on-
Trade-Data-Transparency-FINAL.pdf
---------------------------------------------------------------------------
    Civil society organizations have joined together to demand full 
disclosure of air, road, and rail manifests, in addition to maritime 
vessel manifests. Thousands of shipments subject to the UFLPA could be 
entering U.S. borders through air or land transportation. The UFLPA 
data dashboard does not provide a breakdown of shipments by mode of 
transportation.
    In fact, in February 2023, maritime trade accounted for only 41.08% 
of the total import value processed by CBP.\30\ Almost 60% of U.S. 
imports enter via air, land, or road. We therefore call on members of 
Congress to mandate public disclosure of trade data involving all modes 
of transportation.
---------------------------------------------------------------------------
    \30\ https://www.cbp.gov/newsroom/national-media-release/cbp-
releases-february-2023-monthly-operational-update
---------------------------------------------------------------------------
 pushing for ``no safe harbor for forced labor''--need for information 
   sharing and international coordination around import bans against 
                              forced labor
    Forced labor persists because it is propped up by large 
multinational corporations in some of the world's biggest importing 
economies. Companies are confident that, if caught, they can simply re-
export tainted goods from U.S. ports to other markets. Under both the 
U.S. Tariff Act and the UFLPA, companies have the option to re-export 
goods that CBP suspects were made using forced labor (if they choose 
not to contest this suspicion). In the absence of international 
coordination, with more shipments being targeted by CBP under the 
UFLPA, we run the very real risk of companies simply dumping these 
products in other countries. We urge the U.S. Government to push for 
``no safe harbor'' for goods made using forced labor, especially with 
its key allies. We certainly hope that this will be a key pillar of the 
State Department's Diplomatic Strategy to Address Forced Labor in 
Xinjiang, \31\ which was submitted to Congress on April 12, 2022 and as 
required under Section 4 of the UFLPA.
---------------------------------------------------------------------------
    \31\ https://www.dhs.gov/sites/default/files/2022-06/
22_0617_fletf_uflpa-strategy.pdf
---------------------------------------------------------------------------
    Under the U.S.-Mexico-Canada Trade Agreement (USMCA), all three 
countries are required to have import bans and coordinate with each 
other on the cross-border movement of goods made using forced labor. 
However, we currently do not know what infrastructure has been set up 
under the USMCA to identify such shipments. It is also unclear whether 
the three countries have even agreed on a coordinated approach to 
Xinjiang.
    Canada amended its Customs Tariff \32\ to include an import ban in 
2020, but is seriously lagging behind on enforcement. Media reports 
\33\ suggest that in the last three years, Canadian authorities have 
detained only one shipment over forced labor concerns. That lone 
shipment--clothing from China--was released into the Canadian market 
almost immediately, following a successful appeal by the concerned 
importer. One reason for the slow pace of enforcement could be that 
Canada is enforcing its forced labor import ban on a shipment-by-
shipment basis--something that the U.S. Government should push back on.
---------------------------------------------------------------------------
    \32\ https://www.publicsafety.gc.ca/cnt/trnsprnc/brfng-mtrls/
prlmntry-bndrs/20210625/10-en.aspx
    \33\ https://www.cbc.ca/news/world/canada-u-s-forced-labour-
scorecard-1.6686977
---------------------------------------------------------------------------
    Mexico announced its import ban in February 2023, and will begin 
implementing the law in May.\34\ Unfortunately, there is little 
consistency between the forced labor trade remedies in each of the 
three USMCA countries. There is no agreement on how state-imposed 
forced labor will be treated. There does not seem to be reciprocity for 
CBP's enforcement actions under the UFLPA. The United States should 
push its neighbors to the north and south to enact a region-wide 
prohibition on goods made using forced Uyghur labor. CBP's UFLPA 
enforcement will be severely hobbled without similar actions by Canada 
and Mexico. Forced labor-tainted goods blocked by one country should be 
denied entry in all other countries.
---------------------------------------------------------------------------
    \34\ https://dof.gob.mx/nota--detalle.php?codigo=5679955&fecha=17/
02/2023#gsc.tab=0
---------------------------------------------------------------------------
    The European Union (EU) is currently in the process of developing a 
so-called ``product ban'' against goods made with forced labor; this 
would apply both to imports and goods produced inside the EU. However, 
leading European civil society groups have highlighted major gaps \35\ 
in the proposal published by the European Commission on September 17, 
2022.\36\ Criticisms include ambiguities in the way the EU plans to 
address cases of state-imposed forced labor (like Xinjiang). We urge 
the U.S. Government, especially the USTR and State Department, to use 
its leverage through the U.S.-E.U. Trade and Technology Council (TTC) 
\37\ to push the EU to take a region-wide import ban approach to 
Xinjiang. Last year, we read reports \38\ claiming that Xinjiang's 
exports to the European Union (EU) rose by more than 34%. Without a 
similar regional approach to Xinjiang, the EU will continue to be a 
dumping ground for goods manufactured using Uyghur labor.
---------------------------------------------------------------------------
    \35\ https://www.antislavery.org/wp-content/uploads/2022/10/Joint-
Statement-on-EU-FLI-10.22-v3-1.pdf
    \36\ https://ec.europa.eu/commission/presscorner/detail/en/
ip_22_5415
    \37\ https://ustr.gov/useuttc
    \38\ https://www.euractiv.com/section/economy-jobs/news/eu-imports-
from-xinjiang-rose-by-34-in-2022/
---------------------------------------------------------------------------
    The United States should also push its G7 and G20 allies to enact 
import bans against forced labor. The U.S. Government has an 
opportunity to make the case for ``no safe harbor'' for goods made 
using forced labor at the upcoming G7 summit in Hiroshima.\39\ With 
Japan's G7 presidency this year, there is great potential for the two 
countries to work closely on trade. We were encouraged to see the 
creation of the U.S.-Japan Task Force on the Promotion of Human Rights 
and International Labor Standards in Supply Chains in January this 
year.\40\ We urge the trade ministers of the two countries to 
prioritize import ban enactment and coordination.
---------------------------------------------------------------------------
    \39\ https://www.g7hiroshima.go.jp/en/
    \40\ https://ustr.gov/about-us/policy-offices/press-office/press-
releases/2023/january/united-states-and-japan-launch-task-force-
promote-human-rights-and-international-labor-standards
---------------------------------------------------------------------------
    If we hope to achieve the goals outlined in the UFLPA, the United 
States cannot act alone. A patchwork of laws with different standards 
will only frustrate enforcement of import bans. A more coordinated 
approach between countries to identify and track goods made with forced 
labor will result in profound impact. No safe harbor for goods made 
with forced labor will make re-export impossible. These goods should 
not find any market.
                               conclusion
    We are at a pivotal moment in global trade. Market restrictions, 
import bans, and economic sanctions have become the norm in efforts to 
address forced labor across the supply chain. UFLPA is a powerful tool 
to end state-sponsored forced labor. But it must be enforced.
    We acknowledge the enormity of the task before CBP and other 
agencies in the FLETF. By addressing the gaps outlined in the hearing 
today, along with a more robust forced labor enforcement strategy, we 
are confident that the U.S. Government can create pressure to disrupt 
forced labor in the Uyghur region and throughout China. In addition, 
enforcement will reduce our market exposure to products made using 
forced labor. This will also protect U.S. workers, who cannot compete 
against forced labor. Ultimately, we want UFLPA enforcement to have a 
ripple effect, encouraging other countries to impose import 
prohibitions against forced labor.
    As Professor Laura Murphy poignantly noted in her keynote address 
at CBP's recent Forced Labor Tech Expo, \41\ we need to reframe our 
discourse around supply chains and forced labor in Xinjiang. What we're 
really talking about here is the risk to the Uyghur people--this is not 
just an issue of ``risk'' to business operations.
---------------------------------------------------------------------------
    \41\ https://www.dvidshub.net/tags/video/cbp-forced-labor-
technical-expo/page/1
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    Companies have a duty to prevent the use of forced labor in their 
supply chains. They have been on notice for years. And now is the time 
to eradicate forced labor in global supply chains, once and for all.
                                 ______
                                 

                 Prepared Statement of Laura T. Murphy

    Thank you, Chairman Smith and Co-chairman Merkley for convening 
this meeting and to all of the Congresspeople who are attending today 
and to all who have supported the rights and freedom of Uyghur people. 
My name is Laura Murphy, and I am Professor of Human Rights and 
Contemporary Slavery at Sheffield Hallam University in the UK. I have 
studied forced labor globally for nearly 20 years, and my work for the 
last three years has focused exclusively on the Uyghur Region of China.
                               successes
    The Uyghur Forced Labor Prevention Act is landmark legislation. 
Researchers who study the perilous situation of people enslaved around 
the world have known that the level of supply chain scrutiny and 
corporate accountability required by the UFLPA is necessary if we want 
to ensure that the people who work to produce our goods are not being 
enslaved or trafficked. It is painful to realize that it took a 
genocide for us to understand just how dire the consequences of our 
ignorance could be. There is no silver lining to the oppression of the 
Uyghurs and other minoritized people in the Uyghur Region, but it is 
commendable that the U.S. has been the first to create the legislation 
necessary to level real economic costs on the PRC government's state-
sponsored forced labor program and on the corporations that directly 
benefit from those forced to work.
    It is critical to note that while we still have a long way to go 
before we intercept all products made in whole or in part in the Uyghur 
Region, the UFLPA is indeed working as it was intended. In the short 
nine months that the UFLPA has been in effect, we have seen a swift and 
decisive enforcement response. Customs and Border Protection has 
indicated that it has refused at least 424 shipments entry into the 
United States after investigating their links to Uyghur forced labor. 
Those products span a broad spectrum including electronics, solar 
panels, apparel, and building materials. Congress has allocated 
significant resources--though more will still be needed--to enable CBP 
to conduct the in-depth supply chain investigations required to 
understand where our products are made, down to the raw materials. This 
work has protected consumers from unwittingly buying products that we 
know to be made in the midst of a genocide, in the shadows of a massive 
internment camp system, by people who are visited day after day by 
government agents and prosecutors and prison bureau officials demanding 
that they leave their children and parents and land and culture and 
religion behind to work in the factories that make goods that end up on 
our shelves. Even though Uyghurs continue to be forced to work in 
China, we in the United States have some small comfort that we might 
not be financing their suffering and that every day U.S. corporations 
are reducing their complicity in these crimes against humanity.
            challenges of enforcement: corporate compliance
    Of course, enforcement of the UFLPA is not an easy task. What our 
research at Sheffield Hallam University has found is that since the 
UFLPA went into effect, companies have not all responded with 
enthusiasm. Many U.S. (and multinational corporations selling in the 
U.S. market) lobbied to prevent the law from being passed, and then 
fought to limit how it would be enforced, and now are complaining that 
the investigations are not convenient for them. Companies that are not 
making products involving the UFLPA ``priority sectors'' still have 
their heads in the sand, hoping that their products will not be 
scrutinized. Many are shifting the burden of due diligence onto their 
suppliers, rejecting the responsibility and the costs of knowing the 
conditions of workers in their supply chains. They throw their hands up 
in the air as auditors are jailed, their offices ransacked, and say 
they cannot do anything to address forced labor in the Uyghur Region 
because that could put the lives of their China-based staff at risk. 
They care about their own directly employed personnel and yet do not 
worry about the Uyghur workers at the end of their supply chains. Those 
that have done the right thing by terminating their relationships with 
suppliers implicated in Uyghur forced labor have refused to be 
transparent about it, out of fear of retaliation in China. And many 
still refuse to admit what is becoming increasingly clear--that there 
is no feasible way to verify labor standards compliance in the Uyghur 
Region or of Uyghurs working outside the region. This all shows that 
companies across sectors must be compelled through vigorous enforcement 
to comply with the UFLPA.
    Some international companies and governments are claiming the UFLPA 
is merely about a trade war between the U.S. and China, trying to 
justify their indifference toward profiting from a genocide. It is 
crucial that the U.S. Government encourage our allies to align their 
laws to prohibit the import of forced labor-made goods, but we should 
not link the UFLPA to trade and economic competition issues--we must 
make it clear that this is a human rights issue, not a strategic one. 
If we don't, the U.S. is likely to remain the only country with a ban 
on Uyghur forced labor imports.
             enforcement challenge: obscuring supply chains
    In China, we are seeing companies pretend to sell their Uyghur 
Region factories, only to transfer them to executives within their own 
leadership team or family. They change the names of their subsidiaries 
to obscure the names that have been revealed by the media to be 
involved in Uyghur oppression. They are shipping their products first 
to third countries, where they know that convoluted supply chains mask 
their complicity. They are bifurcating their supply chains so that they 
can continue to sell goods in the U.S. market while still selling 
Uyghur forced labor-tainted goods elsewhere in the world, sometimes 
even continuing to manufacture directly in the Uyghur Region and using 
people ``transferred'' by the state for work. Some of those companies 
are benefiting from the Inflation Reduction Act (IRA) incentives, while 
continuing to operate in the Uyghur Region. The U.S. should prohibit 
companies from using U.S. Government incentives to expand their 
manufacturing in the United States while they continue to profit from 
Uyghur forced labor in China.
                       enhancing priority sectors
    We know that this affects a wide range of goods. The Xi Jinping 
government has published explicit directives indicating the 
manufacturing sectors they are investing in in the Uyghur Region. These 
include items that are critical to our supply chains and to meeting our 
climate goals, including renewable energy-related products, critical 
minerals, steel and aluminum, PVC, agricultural products. The U.S. 
urgently needs to add these products to its priority list of goods 
produced in the Uyghur Region to ensure that we are stopping these 
goods from coming into our markets and to alert the business community 
to the enormous risk of sourcing forced labor-made goods if they do not 
commit to more diligent supply chain tracing.
                       enhancing the entity lists
    Our research team has identified 55,000 companies, large and small, 
operating in the Uyghur Region.
    We have published in-depth investigations that have documented at 
least 150 specific companies in the Uyghur Region and elsewhere in 
China for which there is significant evidence of participation in 
state-sponsored labor transfer programs that are tantamount to forced 
labor. These companies are hiding in plain sight. Some of them are 
massive state-owned corporate conglomerates that served as the 
architects of the repressive programs that oppress minoritized people 
in the Uyghur Region; others produce the lion's share of commodities 
essential to manufacturing worldwide. These companies sell their goods 
into international markets.
    The UFLPA requires FLETF to create a ``comprehensive'' description 
of the situation of forced labor in the Uyghur Region and list the 
companies that are engaged in those programs. And yet the entity lists 
include only four of the companies we have identified as offenders--and 
zero new ones have been added since the UFLPA was passed.
    The first version of these lists did nothing more than reiterate 
the 20 companies that had already been named in previous withhold 
release orders. It is hard to comprehend why still, not even a single 
addition has been made to these lists, especially in light of the 
evidence provided by civil society organizations to FLETF that warrants 
the addition of potentially thousands more entities.
    Under Secretary of Homeland Security Robert Silvers recently 
committed to expanding the entity list. The U.S. Government needs to 
prioritize making the UFLPA entity lists as comprehensive as possible, 
per the mandate of the UFLPA. FLETF should begin with the state-owned 
companies that have openly done the bidding of the PRC government to 
force sometimes thousands of people to work for their companies. FLETF 
should then add to the lists those companies operating in the shadows 
in the mining and processing tiers of our supply chains that are least 
visible to companies. Congress should make clear to FLETF that it must 
presume that all state-sponsored labor transfers in the Uyghur Region 
constitute forced labor and thus add any company engaged in those 
coerced transfers of laborers onto the lists. These iterative and 
constantly expanding lists will assist importers in ensuring that they 
know which suppliers to exclude from their sourcing.
                               conclusion
    The UFLPA provides us with a robust set of tools for weeding out 
the fruits of forced labor from the products that reach our markets. 
The rebuttable presumption is one important tool, but the priorities 
list and the entity lists are also critically important tools that 
consumers, advocates, industry, and enforcement all benefit from. We 
should put those tools to their most robust use. We cannot be hesitant 
about doing every single thing we can, using every single tool at our 
disposal, to address the genocide in the Uyghur Region. I'm pleased 
that we're having this hearing to review all that the UFLPA has 
accomplished and to consider what more we can do to lead the world in 
addressing what is likely the worst human rights crisis we'll see in 
our lifetimes. I believe that we should not rest until we know we've 
done every single thing we possibly can to end the Uyghur genocide and 
to end corporate complicity in it.

                   Prepared Statement of Kit Conklin

                                overview
    Chairman Smith, Chairman Merkley, distinguished members of the 
Commission, thank you for the opportunity to speak before you this 
morning. I would like to start by saying that I am representing myself 
this morning and all views are my own.
    The Uyghur Forced Labor Prevention Act (the UFLPA or the Act) bans 
the import of goods or commodities from the People's Republic of China 
produced with forced labor. Specifically, the Act mandates a 
``rebuttable presumption'' that any products made wholly or in part in 
the Xinjiang Uyghur Autonomous Region (``Xinjiang''), or by any Chinese 
company on a U.S. list of entities involved in the use of forced labor, 
are made with forced labor and banned from importation into the U.S.
            reflecting the increased international consensus
                  on the need to address forced labor
    U.S. trading partners around the world have enacted or are 
introducing legislation to ban products made with forced labor, to 
include the European Commission, Germany, France, Canada, and Mexico, 
among other jurisdictions. Each of these bans similarly requires 
importing companies subject to the laws of these jurisdictions to 
engage in supply chain due diligence to identify and mitigate exposure. 
U.S. companies are not alone, as expectations are increasing around the 
world for industry to address forced labor exposure in global supply 
chains.
                              enforcement
    CBP has stated that UFLPA detentions constitute less than 0.1% of 
goods imported into the U.S., yet since enforcement of the UFLPA began 
in June 2022, CBP has detained approximately $1 billion worth of 
products suspected of containing inputs made with forced labor in 
China.
    CBP has prioritized enforcement relating to four goods: cotton, 
polysilicon, tomatoes, and aluminum--although the scope of the UFLPA 
includes any raw materials and goods that are mined, farmed in, or 
connected to Xinjiang. For instance, billions of dollars' worth of raw 
materials, rare earth minerals, and products are exported from Xinjiang 
each year, including a significant percentage of global lithium-ion 
batteries, 20% of global production of calcium carbide (used to make 
PVC among other materials), 10% of global production of rayon (used to 
manufacture apparel and home good items), 9% of global beryllium 
deposits (a key rare earth mineral used for the production of satellite 
and aviation components), and 8% of global pepper production. In 
addition to raw materials and goods sourced from Xinjiang, the UFLPA 
also bans products made with forced labor in other provinces in China.
                         compliance challenges
    The sheer volume and scope of goods targeted under the UFLPA poses 
significant compliance challenges for industry, as supply chains have 
increasingly become globalized, complex and opaque. The critical 
challenge for industry--to discover supply chain visibility and detect 
risk--is compounded by the Act's rebuttable presumption and the lack of 
a de minimis exception, meaning even an insignificant input of product 
produced in-whole or in-part with forced labor could result in 
enforcement action.
    The global nature of modern supply chains further complicates 
compliance because CBP maintains authority to detain goods imported 
into the United States from third countries. Since UFLPA enforcement 
began in June 2022, CBP detained $89 million worth of goods imported 
directly from China, but, for instance, detained over $490 million 
worth of goods from Malaysia and over $369 million worth of goods from 
Vietnam. These figures illustrate UFLPA transshipment risk and why the 
lack of a de minimis exception necessitates the need for due diligence 
into all suppliers, not just those located in China.
                                guidance
    Beyond the four product areas categorized as high priority for 
enforcement, CBP has publicly stated that it is considering other 
product categories that will be subject to priority targeting and 
enforcement. Irrespective of further announced priorities, as some in 
industry have requested, CBP guidance issued on July 13, 2021 and 
amended on June 17, 2022 sets forth red flags for forced labor exposure 
for all categories of products that pose UFLPA risk as well as 
information CBP may require from importers. These red flags include 
involuntary labor transfers, supply chains connected to prisons, and 
any affiliates of the Xinjiang Production and Construction Corps 
(XPCC). The amended guidance further states ``an importer seeking an 
exception to the rebuttable presumption must demonstrate that it has 
fully complied with the requirements [in the guidance].'' These 
requirements include, for example, supply chain mapping, intelligence 
to identify and assess forced labor risk, training, and monitoring of 
suppliers. CBP guidance also states that UFLPA compliance is not static 
and that industry should ``update [supplier risk information] on a 
regular basis.''
                     towards sustainable compliance
    Similar to industry responses when countering money laundering, 
sanctions or anti-bribery compliance became priorities, CBP's 
enforcement posture is a major driver for the material investments 
industry is making to address UFLPA due diligence and compliance. As 
CBP's budget and resources expand to support the counter forced labor 
mission, many in industry are almost certain to adapt with increased 
senior management attention, and with support and budget for the 
technology and people needed to address risk.
    In line with guidance, companies that make reasonable, risk-based 
investments to effectively map supply chains, layer in risk 
intelligence, and conduct training and monitoring--in most instances--
should be positioned to materially improve their capabilities to 
identify potential UFLPA exposure. As industry implements UFLPA 
compliance programs, global supply chain management practices will 
continue to adapt as companies mitigate forced labor risk and build 
resilience. Observers have already pointed to impacts on supply chains 
relating to green energy products, rare earth minerals, food items, and 
pharmaceutical precursors. Companies with supply chains prioritized by 
CBP for UFLPA enforcement have also started to review and implement 
obligations and best practices to mitigate UFLPA risk.
    In summary, compliance with the UFLPA is complex and not binary, 
similar to compliance with AML, sanctions, and anti-bribery. 
Nonetheless, with senior management support and in line with guidance, 
effective programs can be established to identify exposure and mitigate 
risk of forced labor in the supply chain. As DHS Under Secretary 
Silvers recently stated, ``over the years, things like anti corruption 
and sanctions compliance have come to be standard pillars of corporate 
compliance programs. Forced labor needs to be one of those pillars as 
well.''

                                 ______
                                 

                 Prepared Statement of Elfidar Iltebir

    My name is Elfidar Iltebir and I was born in East Turkistan, the 
Uyghurs' homeland where Uyghurs have been living for thousands of years 
and what China now calls the Xinjiang Uyghur Autonomous Region. Like 
many Uyghurs, my family also faced persecution at the hands of the 
Chinese Communist Party (CCP). After waging more than six decades of 
repressive assimilationist policies to weaken and eliminate the Uyghur 
identity, the CCP under its general secretary Xi decided to implement 
the ``final solution'' and resorted to genocide in the 21st century. 
The CCP's ultimate goal is to completely annihilate the Uyghur 
identity, our cultural values and religious beliefs, and homogenize 
China's population by forcibly transforming Uyghurs into majority Han 
Chinese. To achieve this goal, the CCP has transformed our homeland 
into a totalitarian surveillance state; detained millions of people in 
detention camps, forced labor camps, and formal prisons; and subjected 
the Uyghur people to inhumane conditions, including torture, sexual 
abuse, forced sterilization, forced labor, and forced separation of 
families.
    When my father, a prominent Uyghur writer and intellectual, feared 
for his life in our homeland, our family fled China in 1992. Thanks to 
the American Government, we were able to seek refuge in the United 
States, our adopted homeland. Inspired by the belief that all human 
beings are endowed with certain rights and freedoms that governments 
are supposed to protect, not abuse, I wanted to help my people fight 
for their God-given rights and freedoms in this land of the free and 
home of the brave. I am now the President of the Uyghur American 
Association based here in Washington, DC. UAA is a nonpartisan 
community-based organization that promotes the preservation of Uyghur 
culture and advocates for the human rights, freedom, and self-
determination of the Uyghur people. We serve as the primary hub for the 
Uyghur diaspora in the United States and respond to the needs of our 
community members on a variety of issues. Since 2017, we have focused 
major efforts on advocating for the Uyghur people being subjected to 
genocide in our homeland, including family, friends and other loved 
ones of UAA members.
    The main point I would like to stress today is that the Chinese 
government's campaign of forced labor targeting Uyghurs is not purely 
economic exploitation that benefits Chinese companies. It is a critical 
part of China's systematic oppression of the Uyghur people and the 
ongoing genocide in the Uyghur homeland. The Chinese government's 
forced labor practices are tearing apart the fabric of Uyghur society, 
separating families and displacing them from their communities, 
stripping away their ethnic and religious identity, and leading to a 
reduction and dilution of the Uyghur population. As Uyghur 
intellectuals, religious scholars, professionals, businesspeople, 
cultural icons, and tradition bearers are still imprisoned in detention 
camps, forced labor camps, or formal prisons, and Uyghur men and women 
are enslaved in factories while their children are raised in state 
orphanages, this ongoing genocide puts Uyghur people on the verge of 
total annihilation. And we believe that is the ultimate goal of the 
CCP.
    I want to share a quick story of my friend Kalbinur Gheni, who now 
lives in DC. In 2018, her sister Renagul was taken to a concentration 
camp for praying at her father's funeral and possessing religious 
literature. She was later transferred to a prison and forced to work at 
a garment factory inside of the prison. Her children were separated 
from her family. The Chinese government not only detained twelve other 
members of Kalbinur's family and sent them to camps and later to 
prisons, but it has also been harassing her on U.S. soil for speaking 
out about her detained family members. She received threatening 
messages directly from the Chinese police almost every week last year.
    Many more members of our community have similar stories of loved 
ones being detained and exploited. This is one reason our community 
fought so hard for the passage of the Uyghur Forced Labor Prevention 
Act (UFLPA) and why we continue to fight for its full enforcement. We 
stayed up many nights writing thousands of letters, made even more 
phone calls, and roamed the halls at Capitol Hill, knocking on every 
door to deliver our message. Our message was simple: Stop sourcing 
goods from supply chains tainted with Uyghur forced labor. No business 
with genocide. No profit from genocide. On behalf of Uyghur Americans, 
I'd like to take this opportunity to thank Senator Rubio, Senator 
Merkley, Representative Smith, and Representative McGovern for their 
leadership and to many others who were instrumental in passing the 
UFLPA. Thank you for refusing to make Americans complicit in China's 
genocide against the Uyghurs and for putting universal values of human 
rights and dignity above economic interests.
    We were overjoyed with the passage of the UFLPA. We believed the 
UFLPA would be a turning point in stopping China's genocide. We 
believed it would be a catalyst for greater awareness among businesses 
of the CCP's atrocities in the Uyghur homeland and that it would compel 
them to investigate and cut links to supply chains connected to Uyghur 
forced labor in the Uyghur homeland and across China. We believed we 
would see the shift we had been waiting for since the beginning of this 
genocide and that the Chinese government would get the message loud and 
clear from the United States: We stand against the ongoing genocide 
against Uyghurs and we're not spending one American dollar on any goods 
that are tainted by the forced labor of the Uyghur people. Americans 
will not consume or profit from the proceeds of genocide.
    However, when I recently saw in my neighborhood grocery store the 
red date products that were produced by the Bingtuan, or the Xinjiang 
Production and Construction Corps (XPCC), which is a paramilitary 
organization that implements the Chinese government's genocidal 
policies in the region and facilitates Uyghur forced labor, it felt 
like a slap in the face. How are the U.S.-sanctioned XPCC's products 
being displayed on shelves in the U.S. in packaging with images of 
dancing Uyghurs and outlines of Uyghur scenery? As an Uyghur American, 
every time I shop for clothing items, grocery items, or electronics, or 
look at automobiles or solar panels, I think about how these ``Made in 
China'' products might have been made by a loved one in my hometown 
subject to forced labor, and if not my loved one, that of another 
fellow Uyghur here in the United States. Why, I ask myself, are Chinese 
companies still able to circumvent the UFLPA and continue to profit 
from Uyghur forced labor? The human cost of this forced labor is why it 
is so important to ensure that the UFLPA is fully and rigorously 
implemented the way it is intended. I know there are hundreds of hard-
working people at the Customs and Border Protection Agency, the Forced 
Labor Enforcement Task Force, and other government agencies, as well as 
human rights and workers rights groups that are committed to enforcing 
the Uyghur Forced Labor Prevention Act. I also know there are many 
challenges, gaps, and loopholes that require us to keep working 
together to fully implement and enforce the UFLPA so that American 
businesses and consumers don't become complicit in the genocide against 
Uyghurs. We must face these challenges and many more head on and 
strengthen enforcement mechanisms to ensure that American and Chinese 
businesses and the Chinese government get the message: No business with 
Uyghur genocide.
    As Uyghur Americans, we are prepared to contribute to the 
successful implementation and enforcement of the UFLPA so that we can 
help deliver that message. We may not be able to close the camps 
overnight, to reunite our families this Ramadan, to stop the Chinese 
government's mass sterilization of Uyghur women by the next session of 
the U.N. Committee on the Elimination of Discrimination against Women 
and much more that we need to end this genocide. But as I sit here 
today, I can say with confidence that together we can stop products 
made with Uyghur forced labor from entering onto U.S. soil and make 
this genocide costly for China. We can be an example for our allies to 
implement similar laws so ``Made in China'' products tainted with 
Uyghur forced labor cannot enter any markets that value human beings 
and fair trade.
    If there is one thing we ask the U.S. Government on behalf of the 
Uyghur American Association, that would be to hold the Chinese 
government and affiliated entities accountable for the genocide and 
crimes against humanity by imposing economic cost on Chinese officials 
and companies implementing, facilitating, and supporting this genocide. 
The United States passed two pieces of historic legislation, the Uyghur 
Human Rights Policy Act, signed by the Trump Administration, and the 
Uyghur Forced Labor Prevention Act, signed by the Biden Administration. 
Yet, as far as we know, no Chinese official or entity has been 
sanctioned under these legislative authorities. Both administrations 
recognized China's atrocities as genocide. Yet, U.S. businesses are 
still operating in the genocide zone, U.S. companies are still selling 
technology to Chinese companies implementing this genocide, and U.S. 
companies are still investing in Chinese companies supporting the 
Chinese government's genocidal policies. We need to ensure no American 
technology or investment is flowing to Chinese companies that are 
linked to China's genocide against Uyghurs and no Chinese products 
tainted with Uyghur forced labor are entering our territory. First we, 
as Americans, need to eliminate our inadvertent complicity in this 
ongoing genocide and then we can ask our allies and partners to do the 
same so that the Chinese government is held accountable for the 
genocide and crimes against humanity it is committing against the 
Uyghurs in the 21st century.

                                 ______
                                 

                 Prepared Statement of Hon. Chris Smith

    Good morning, and welcome to the first hearing held this Congress 
on implementation of the Uyghur Forced Labor Prevention Act, a truly 
landmark piece of legislation that has the potential to alter the 
dynamic of our ongoing struggle with the People's Republic of China--
but only if it is implemented properly.
    And make no mistake about what the stakes are: we are in a struggle 
with Communist China--not something anodyne, like simple ``strategic 
competition.'' Rather, the United States is in a survival struggle with 
an authoritarian state that seeks global hegemony and the fundamental 
displacement of the United States and the liberal economic order. To 
that end, the PRC will take advantage of the Western world's liberal 
trade regime, while utilizing forced labor in order to give itself an 
unfair trade advantage--all with the ultimate objective of imposing its 
governance model upon the rest of the world.
    We have known for years that the PRC has used forced and indeed, 
prison slave labor . . . I knew this as far back as 1991, when former 
Congressman Frank Wolf and I went to Beijing Prison No. 2 and found at 
least 40 Tiananmen Square activists being forced to make jelly shoes 
and socks for export to the United States. We asked for, and were 
given, samples which we then promptly brought back to the United States 
and had an import ban imposed, pursuant to the Smoot-Hawley Tariff Act 
of 1930.
    There was some personal satisfaction to be had from that, but in 
terms of net practical effect in impacting the PRC's policy of 
utilizing forced prison labor, it was next to zero. In this case we had 
direct evidence, but that was a unique set of circumstances. How else 
could Customs and Border Protection prove that goods were being made by 
prison labor, absent a couple of Congressmen bringing back jelly shoes 
from a visit to a prison factory?
    This is where the genius of the Uyghur Forced Labor Prevention Act 
comes in--the burden is no longer upon the good men and women of CBP to 
prove that goods have been made by forced labor, but upon importers to 
prove that goods made in the Xinjiang Uyghur Autonomous Region and 
elsewhere are free from the taint of forced labor.
    For we now know that the CCP under Xi Jinping has declared war on 
the Uyghur people, labeling them terrorists who must be destroyed 
``root and branch.'' This has led to the massive detention of more than 
a million Uyghurs, many of whom are forced to work and who are 
subjected to horrific human rights abuses, including forced 
sterilization, forced abortion, and indeed, forced organ harvesting.
    These egregious human rights abuses are what the UFLPA is designed 
to combat. We know from reports released yesterday in advance of this 
hearing, the CBP has seized over $961 million worth of goods since last 
June. This is an important start, as is CBP's holding of a tech expo 
for industry last month and its launch of a dashboard to track trade 
statistics.
    As Co-chair Merkley and I, joined by Ranking Member McGovern and 
Senator Rubio, stated in a letter addressed to the Department of 
Homeland Security last week, however, we do remain concerned over the 
lack of full transparency that would enable Congress to evaluate the 
efficacy of implementation.
    We are also concerned as to whether the ``rebuttable presumption'' 
standard is being fully implemented, and whether goods that are 
initially detained are subsequently being released without 
congressional or public reporting.
    We have questions as to why the robust Entity List of bad actors 
that UFLPA requires remains so spartan. We also question whether CBP is 
utilizing technology, such as isotopic and DNA testing, to its fullest 
to identify goods produced in the Xinjiang Uyghur Autonomous Region.
    Finally, we also question whether goods produced by forced labor 
outside the XUAR are being captured. We have been working with Homeland 
Security to follow up on well-founded reports that work gloves sold 
under the Milwaukee Tool label in venues such as Home Depot are indeed 
produced by prison labor--at Chishan Prison in Hunan province, to be 
precise.
    Going forward, we will be taking a closer look at companies such as 
Milwaukee Tool and their alleged profiteering from forced labor, just 
as we have highlighted the role of Thermo Fisher Scientific in genetic 
data collection that enables repressive practices in both the Xinjiang 
Uyghur and Tibet Autonomous Regions--and, more nefariously, has been 
implicated in finding DNA matches from organ harvesting victims.
    It is my hope that the UFLPA will prick the consciences of 
corporate actors and encourage them to scour their supply chains to 
make sure they are free from the taint of forced labor. If not 
motivated by altruism, then by raising the cost of doing business in 
the PRC, it is my further hope that companies will determine that 
bottom-line concerns will motivate them to do the right thing. Finally, 
for those that are incorrigible and seek to skirt the law, we will seek 
enforcement action and bring public scrutiny to bear.
                                 ______
                                 

                Prepared Statement of Hon. Jeff Merkley

    Mr. Chairman, thank you very much. The Uyghur Forced Labor 
Prevention Act is a testament to why the Congressional-Executive 
Commission on China exists. Horrified by the evidence documented by the 
Commission's tireless researchers that the products of slave labor 
reach American shelves in vast quantities, the four most recent chairs 
of this Commission acted, and coming from the Senate side, a special 
recognition to Senator Rubio who partnered in the bipartisan effort on 
the Senate side. On a bipartisan and bicameral basis, we introduced, 
advocated for, and passed landmark legislation that sent a resounding 
and unequivocal message that the United States would not stand idly by 
as the world witnesses the evils of genocide and the evils of slave 
labor.
    This law, the Uyghur Forced Labor Prevention Act (UFLPA), aims to 
target China's ability to profit from genocide, hold corporations that 
trade in products of forced labor accountable, and protect American 
consumers from being unwitting accomplices in these horrors. In the 16 
months since it became law and 10 months since its key provisions went 
into effect, the UFLPA has made a difference. As we'll hear today, it's 
put businesses on notice that they can no longer claim it's too 
difficult to trace their supply chains. Armed with substantial new 
resources provided by Congress, U.S. Customs and Border Protection now 
devotes unprecedented attention to investigating those supply chains 
and stopping problematic imports. As a result, direct exports from 
Xinjiang have plummeted and businesses are changing their practices to 
speed up production capacity elsewhere in the world, increasing the 
diversification and sustainability of their supply chains.
    But as much as we've accomplished, it's only the tip of the 
iceberg. Compliance with this law requires a paradigm shift. It 
requires companies to be vigilant in the same way we expect them to 
guard against bribery and corruption and money laundering. Companies 
that resist compliance or look to exploit loopholes need to be held 
accountable. The U.S. Government's Forced Labor Enforcement Task Force 
needs to implement the law even more aggressively, with particular 
attention to transshipment of Xinjiang-origin goods via third 
countries.
    Congress needs to make sure these efforts are fully funded and that 
any gaps we identify are plugged. And countries around the world need 
to take their own actions to make sure that the purveyors of forced 
labor can't just send their goods elsewhere. That action by other 
countries is needed to avoid bifurcated supply chains that allow 
companies to sell clean products in the United States and turn around 
and pocket the proceeds of tainted forced labor products elsewhere.
    It's a big challenge to implement a law, and it's a big challenge 
to implement this law given the complexity of international trade. But 
we owe it to the millions of exploited Uyghurs and other ethnic 
minorities in China, and as my colleague mentioned, this isn't just 
about China, this is about taking on this issue and setting a model for 
how we deal with it around the world. We owe it to American consumers, 
who don't want to be part of economic machinery of genocide, and to the 
businesses doing the right thing who want to play on a level playing 
field. It is an honor and a responsibility to take on this task in 
partnership with my colleagues in both Houses and both sides of the 
aisle. Thank you, Mr. Chairman.
                                 ______
                                 

              Prepared Statement of Hon. James P. McGovern

    Thank you, Mr. Chairman, for scheduling this hearing. I look 
forward to the testimony of our witnesses on the implementation of the 
Uyghur Forced Labor Prevention Act, its impact on global supply chains, 
and how we might improve its implementation.
    On a personal note, as the author of the House UFLPA legislation, I 
want to thank my partner on this legislation, Senator and fellow 
Ranking Member Rubio, my good friend and colleague Senator Merkley for 
his leadership on the UFLPA, and Chairman Smith for organizing this 
hearing. This group demonstrates the strong bipartisan support this 
issue has received in both the House and the Senate.
    Since the UFLPA was signed into law, we've seen significant efforts 
by Customs and Border Protection--CBP--and the multi-agency Forced 
Labor Enforcement Task Force--the FLETF--to implement the UFLPA. As the 
lead enforcement agency, CBP has been a strong ally in its 
implementation.
    The law itself recognizes that implementation is multisectoral. It 
requires engagement, cooperation, and action by CBP, but also by the 
private sector, including importers, and by NGOs, which have research 
and monitoring capabilities.
    Last week the CECC chair, co-chair, and ranking members--namely 
Congressman Smith, Senator Merkley, Senator Rubio, and I--wrote to DHS 
Under Secretary Robert Silvers, who chairs the Forced Labor Enforcement 
Task Force, to request more information on certain key aspects of the 
law's implementation to date.
    Due to the timing of today's hearing, neither CBP nor DHS was able 
to appear and provide their views and insights on implementing the 
UFLPA. I look forward to a future hearing where we can hear about their 
experience and get suggestions for how to pursue comprehensive 
enforcement.
    The UFLPA was a targeted response to a specific, very serious human 
rights problem: the widely documented, intentional use of forced labor 
in the Xinjiang Uyghur Autonomous Region of China. The use of forced 
labor is one of a set of interrelated policies implemented by the 
People's Republic of China against Uyghurs and other largely Muslim 
Turkic peoples in the region that, taken together, likely meet the 
legal definition of crimes against humanity and genocide.
    In the law, by forced labor we mean ``[a]ll work or service which 
is exacted from any person under the menace of any penalty for its 
nonperformance and for which the worker does not offer himself (or 
herself) voluntarily,'' a definition first applied in tariff law in the 
1930s.
    But section 3 of the UFLPA, which establishes a presumption that 
the import prohibition applies to all goods mined, produced, or 
manufactured in the Xinjiang Uyghur Autonomous Region, represents a 
new, even revolutionary, approach to protecting human rights.
    Basically, instead of presuming that the norm is that human rights 
violations are not committed, the UFLPA presumes the opposite, that the 
standard practice is that rights violations are committed.
    This presumption is grounded in research that found that--
    (1) the use of forced labor is pervasive in the Xinjiang region, 
and
    (2) because there is a lack of transparency and independent 
investigations and audits, it is impossible to distinguish between 
industry and manufacturing that involves forced labor and that which 
does not.
    The law establishes an appeals process that allows a company to 
make the case that its goods are not produced with forced labor. To do 
so, the company must provide ``clear and convincing evidence'' that 
they are not.
    There are several issues that merit attention as we review the 
implementation of the UFLPA, which my colleagues have noted in their 
opening remarks, so I won't repeat them here. As implementation of the 
UFLPA advances, there will be lessons learned that may lead Congress to 
tweak the UFLPA or related law.
    But it is worth repeating that the prohibition on importing goods 
made with forced labor is longstanding--what the UFLPA provides is a 
new approach and new tools for enforcement. So, the interest in 
improving enforcement is here to stay.
    It's also important to remember that while the operational aspects 
of the UFLPA are clearly focused on the Xinjiang Uyghur Autonomous 
Region, the statement of policy in the law is broader--namely, ``to 
lead the international community in ending forced labor practices 
wherever such practices occur through all means available to the United 
States government.''
    American consumers should not have to wear clothing, or eat food, 
or use devices made by forced labor, wherever it occurs. American 
companies should not profit off forced labor.
    In brief, Mr. Chairman, I believe the vigorous, successful 
implementation of the UFLPA can establish not just a model, but a 
roadmap, for how to address forced labor everywhere.
                       Submissions for the Record

                                ------                                


       Submission of Robby Stephany Saunders and Charles Benoit,
                   Coalition for a Prosperous America

    Implementation of the Uyghur Forced Labor Prevention Act and the
                     Impact on Global Supply Chains

                              introduction
    The Coalition for a Prosperous America (CPA) thanks the Commission 
for holding this hearing on the Uyghur Forced Labor Prevention Act 
(UFLPA) and its impact on global supply chains. We believe it is 
important oversight to examine the law's impact and continue exploring 
how to eliminate forced labor in multinational supply chains. CPA is a 
nonprofit, bipartisan organization representing the interests of 
domestic producers in manufacturing and agriculture across the country 
of 4.1 million households engaged in domestic production through our 
agricultural, manufacturing and labor members.
    Our written testimony will focus on two key areas: trade and 
investment. Regarding trade, we elaborate on the law enforcement gaps 
and the need to close the de minimis loophole in U.S. customs policy. 
For investment, we outline the importance of stopping the financing 
behind the companies that make the products. Products do not make 
themselves; companies make the products. These products are made by 
forced labor because of the companies involved that benefit from the 
government regime in the People's Republic of China (PRC) and the 
ability of these Chinese Communist Party (CCP) linked companies to 
raise hundreds of billions of dollars for their companies. It is 
morally wrong and illegal for these companies to benefit from forced 
labor and it is also morally wrong for financiers to back these 
companies. It is also then nearly impossible to compete in the global 
marketplace with companies that profit off of slave labor and receive 
minimal to no actual punishment for their actions--while continuing to 
receive international financial backing from the world's most lucrative 
capital markets--those of the United States and the Western world.
                                 trade
    China will not allow the policing of its supply chains, rendering a 
law enforcement approach futile. The Chinese Communist Party (CCP) has 
made it abundantly clear, through both legal and extra-legal means, 
that they will not tolerate investigations into forced labor in China. 
Therefore, the legal requirements of Section 307 of the Tariff Act of 
1930, not to mention our moral duty to fight forced labor, will be 
nullified by attempting to narrowly target particular consignments of 
merchandise from specific entities.
    This is not conjecture. The U.S. Department of State, in a 
statement to the Wall Street Journal, reported that ``We are deeply 
concerned by reports that supply chain auditors have been detained, 
threatened, harassed, and subjected to constant surveillance while 
conducting their vital work in China''. China \1\ has called 
allegations of forced labor in state-run labor programs involving 
Uyghurs ``the lie of the century.'' \2\
---------------------------------------------------------------------------
    \1\ Lingling Wei, Eva Xiao, and Trefor Moss, ``China Closes U.S. 
Auditor as Tensions Mount Over Forced Labor Allegations,'' Wall St. 
Journal Aug. 19, 2021, available at https://www.wsj.com/articles/china-
closes-u-s-auditor-as-tensions-mount-over-forced-labor-allegations-
11629390253
    \2\ Id.
---------------------------------------------------------------------------
    If a class of merchandise originating in China is made in part with 
forced labor, then Withhold Release Orders should apply against the 
entire relevant class(es) of merchandise originating in China. This is 
already authorized by law, and done for smaller countries.
    Fortunately, existing law and practice offers an easy remedy to the 
CCP's adversarial stance on policing supply chains. Per existing 
regulations in 19 C.F.R.
 12.42-12.45, when U.S. Customs & Border Protection (CBP) is presented 
with information that indicates that merchandise was produced using 
forced labor, CBP is permitted to issue a Withhold Release Order 
against all shipments of that class of merchandise for the offending 
country of origin.
    CBP has already done this in other countries. On May 18, 2018, 
following a petition filed by members of the U.S. Cotton Campaign, 
Alternative Turkmenistan News, and International Labor Rights Forum, 
CBP issued a Withhold Release Order against ``All Turkmenistan cotton 
or products produced in whole or in part with Turkmenistan cotton.'' 
The order \3\ does not contemplate any futile attempt to parse 
particular shipments of Turkmenistan cotton depending on supply chain 
records. It is enough to know that the Turkmenistan government is 
tolerating forced labor in cotton, and until that situation is 
resolved, no shipments of Turkmenistan cotton may be entered into the 
United States.
---------------------------------------------------------------------------
    \3\ https://www.cbp.gov/trade/forced-labor/withhold-release-orders-
and-findings
---------------------------------------------------------------------------
    Given that ongoing forced labor abuses assuredly involve complicit 
support from the territory's sovereign, making Withhold Release Orders 
country-wide is the appropriate response. It is also the only 
functional response given the data elements CBP has to work with. Every 
shipment must indicate a country of origin of the merchandise, as well 
as a classification under the Harmonized Tariff System for a formal 
shipment. This makes prohibiting the importation of goods made in part 
with forced labor relatively straightforward, when the Withhold Release 
Order is tied to a class of merchandise and a country of origin.
    If there were situations where particular foreign producers of a 
product were affected unfairly as they did not rely on forced labor, 
then existing practice already authorizes the appropriate approach. On 
November 1, 2019, CBP issued a Withhold Release Order against tobacco 
produced in Malawi and products containing tobacco produced in Malawi. 
This is the best way to start. Since then, three business entities have 
had themselves removed from the order, presumably demonstrating to the 
CBP Commissioner's satisfaction that their particular shipments did not 
constitute forced labor. This is precisely the type of rebuttal 
presumption required by Section 3 of the Uyghur Forced Labor Prevention 
Act.
    Finally, if issuing Withhold Release Orders tied to a class of 
merchandise and a country of origin is deemed ``too much'' given the 
size of China's economy, then we should be honest about that fact.
De Minimis
    Currently, there is no attempt to enforce forced labor Withhold 
Release Orders against merchandise entering through Section 321 of the 
Tariff Act of 1930, known as `de minimis shipments'. Even the most 
basic data, like merchandise country of origin, is typically lacking 
for de minimis shipments. De minimis imports are done by `consignees', 
typically mail carriers or express couriers, who cannot speak to the 
package beyond what is written on the manifest. The manifest 
description in turn may be as simple as one or two words. CBP is clear 
when pressed by legislators: there is no policing of de minimis or 
application of UFLPA to the de minimis channel, which accounts for over 
two million shipments per day. Failing to repeal de minims signals an 
unwillingness to tackle forced labor seriously.
    De minimis was codified in 1938 to ensure that the government was 
not wasting time doing customs assessments on trivial imports. The law 
set thresholds of $5 for merchandise accompanying travelers and bona 
fide gifts, and $1 for every other situation. Each threshold is dealt 
with in a separate subsection.
    In 1978, the ``everything else'' subsection rose from $1 to $5. But 
in 1994, Congress increased it from $5 to $200 along with the other 
sections. All of the Congressional record at that time indicated 
Congress only understood the law as increasing the returning traveler 
exemption.
    Worse yet, via regulation, Treasury unilaterally broke with 
hundreds of years of customs law, saying that any mail carrier or 
express courier (``consignee'') could make entry of merchandise 
entering via Section 321. This was a profound repudiation of the 
expectation in customs law that the importer be able to answer 
questions about the merchandise to a customs officer. This meant 
individuals and entities making imports had title to their merchandise, 
and were either present before a customs officer or engaged a customs 
broker.
    Repealing this requirement for de minimis shipments gave every 
retailer in the world direct access to American homes. We receive 
millions of these shipments daily, and have little information for the 
majority of them.
    All a foreign vendor has to do to claim de minimis treatment is 
assert that the value of the shipment, in their country, is worth less 
than $800. Foreign vendors are able to hand-write these declarations 
completely outside our jurisdiction, and 99.9% of them will necessarily 
be accepted at face value, as our customs authorities have no capacity 
to inspect thousands of mailbox-sized shipments per shipping container. 
Toys can't be tested for lead. Apparel can't be checked for forced 
labor cotton. All of our product safety rules go out the window if the 
foreign vendor merely asserts de minimis.
    Sure enough, 62.5% of de minimis shipments originate from China and 
Hong Kong. The second largest shipment origination country is Canada. 
It is safe to assume that the majority of these shipments are not 
``Made-in-Canada'' merchandise. Instead, they certainly consist of 
mostly Made-in-China merchandise, sitting in bonded warehouses in 
Canada along the U.S. border, waiting to be delivered within 48 hours 
of a customer making a purchase online. This is civilizational suicide, 
and it must end.
    While de minimis is growing rapidly, it likely still accounts for 
less than 3% of merchandise imports, and thus there is still time to 
repeal it without systemic effects. Other nations have rejected 
following us down this folly.
                               investment
    Americans are complicit in the financing of the forced labor 
atrocities this hearing is constructed to address and that the UFLPA is 
supposed to mitigate. But U.S. law and the UFLPA Entity List fails to 
punish corporate human rights abusers and those companies that take 
advantage of forced labor schemes. While products are seized, companies 
go on without being aggressively punished and without losing access to 
troves of capital available in the U.S. We believe that this should be 
addressed to maximize the true effectiveness of the UFLPA. In 2020, 
U.S. holdings of Chinese securities neared $1.2 trillion. This is about 
five times the holdings than that of any other country. The exposure of 
U.S. investments in Chinese securities has never been greater, and it 
will continue to grow. Due to the gaps in U.S. securities laws and 
those laws intended for due diligence, investor protection, or risk 
mitigation, there is no mechanism to prohibit investment in the 
companies that are profiting off of forced labor and complicit in other 
human rights violations or posing a risk to American national security.
    Below are some of the key areas of risk and the actions Congress 
can take to minimize the outflowing capital going to support the forced 
labor regime and the CCP.
A-Shares and Passive Investments
    Congress, the media, and independent regulators like the Securities 
and Exchange Commission (SEC) have recently focused on the risks posed 
to U.S. investors from Chinese companies directly listed on U.S. stock 
exchanges. While CPA welcomes this focus and encourages further action, 
it does not address the bulk of ``bad actor'' Chinese companies that 
are still present in American passive investment products.
    Their presence is in the form of over 4,200 A-share and H-share 
companies found throughout a multitude of financial vehicles, such as 
Exchange Traded Funds (ETFs) and index mutual funds, that have received 
little or no regulatory scrutiny or fiduciary due diligence. Tens of 
millions of Americans are unwittingly exposed to these A-shares in 
their investment portfolios and retirement investment accounts.
    U.S. investors are inadvertently subsidizing Chinese companies 
involved in activities that are contrary to the national security, 
economic security, and foreign policy interests of the United States. 
We are also subsidizing the economic growth of the United States' top 
global adversary. A-shares are securities listed on mainland Chinese 
exchanges and only accessible to American and foreign investors via 
inclusion in indexes and associated index funds. Similarly, H-shares 
are Hong-Kong listed shares. These companies are oftentimes non-
compliant with U.S. securities laws and financial reporting norms and, 
in some cases, have been sanctioned by the U.S. Government for 
egregious human rights and national security abuses. Index providers 
neglect to consider the full range of China-specific material risks to 
investors when determining index constituents and weighting. These 
include considerations of reputational risks relating to national 
security, export controls and sanctions regimes, human rights 
violations, political factors, or even full consideration of 
traditional environmental, social, and governance (ESG) factors.
    As of June 2022, a look at five of the larger index mutual funds 
offered by industry leaders--Fidelity Emerging Markets Index Fund 
(FPADX), State Street Emerging Markets Equity Index Fund (SSKEX), 
BlackRock iShares MSCI Total International Index Fund (BDOKX), Vanguard 
Emerging Markets Stock Index Fund (VEMAX), DFA Emerging Markets Core 
Equity I (DFCEX), which just so happen to be included in the new Mutual 
Fund Window available to TSP beneficiaries--includes at least 14 
underlying companies directly linked to China's military-industrial 
complex and listed on either the Department of Defense's Section 1260H 
list or the Treasury Department's NS-CMIC List or both, in just these 
five funds. This is in addition to several companies on BIS's Entity 
List and others with documented links to the oppressive Chinese 
surveillance state and connected to Uyghur forced labor.
Harmonizing Government Sanctions--How to Guide Investors Away from Bad 
        Actor Chinese Companies Including Forced Labor Human Rights 
        Violators
    Capital markets sanctions are a relatively under-utilized yet 
highly effective tool to be brought to bear to force divestment from 
certain key sectors and bad actor companies in the best interests of 
investors, human rights, market transparency and accountability, and 
national security. These sanctions work when properly implemented and 
are an under-utilized tool of the U.S. Government that this Committee 
must work to establish and enforce legislatively. Especially for those 
interested in not going to an actual kinetic/physical war with China, 
cutting off China's resources--our capital flowing to them--now and 
decreasing our dependence on their exports decreases China's resources 
and wealth to then be able to ratchet up its pressure on Taiwan and to 
play in other key geopolitical sandboxes around the world.
    Polling conducted by CPA shows an overwhelming majority of 
Americans are concerned with investment in risky Chinese companies and 
support stricter investment requirements. A poll conducted by Morning 
Consult shows 62 percent of voters are concerned Americans can invest 
in Chinese and Russian companies that have been sanctioned by the U.S. 
government or have not complied with U.S. laws.
    To accomplish this mission of decreasing and divesting U.S. capital 
from China, a series of executive orders have been promulgated by both 
Republican and Democratic presidents to try to selectively enforce 
capital investment bans on critical Chinese companies in critical 
industries and linked to the CCP military and military-civil fusion 
operations.
    CPA would like to see this concept of capital markets sanctions be 
expanded to include more human rights violations, including those 
complicit in or profiting off of forced labor.
    When expanding to cover forced labor companies, any new policy must 
also include the concept of sanctions harmonization. Better than a mere 
notion of sanctions reciprocity, sanctions harmonization links up 
current lists run by various U.S. Government departments and agencies 
in an interlocking process such that being sanctioned or listed by one 
enables the other to undertake consideration for legal sanctions action 
as well, and ultimately will ideally lead to increased listings by OFAC 
and more rigorous review. The current U.S. Government arrangement sees 
little transparency on why some Chinese companies are chosen to be on 
one list but not another. Across the U.S. Government, there are dozens 
of reports, lists, advisories, or sanctions tranches issued on a 
recurring basis. Some of these include: the U.S. Commerce Department's 
Bureau of Industry and Security (BIS) Entity List; the Military End 
User List, the Unverified List, the Department of Defense's 1260H or 
CMC List (formerly 1237 CCMC List), the new Uyghur Forced Labor 
Prevention Act Entity List maintained by the Department of Homeland 
Security, the OFAC NS-CMIC List, and more.
    The financial industry will not lead. Congress--supported by the 
human rights community--must do so. To ensure against further American 
investment flowing to Chinese companies that pose investor protection, 
national security, and human rights concerns, Congress should take the 
following actions:

      Pass legislation that requires index providers and asset 
managers to address the risks posed by A-share and H-share companies in 
investment products that have zero investor protection, due diligence, 
or disclosures.

      Pass a ``Uyghur Forced Labor Divestment Act'' to prohibit 
investment in companies complicit in forced labor activities and punish 
those intentionally supporting such heinous endeavors.

      Expand the Holding Foreign Companies Accountable Act 
(HFCAA) to cover Chinese companies traded in the United States via 
passive investment products, despite not being directly listed on U.S. 
exchanges, to ensure that ETF products traded on U.S. exchanges are 
PCAOB compliant, consistent with the investor protection imperatives of 
the Act.

      Compel the SEC to require further disclosures and issue 
new rules for index providers as it pertains to oversight of quality 
control and minimizing conflicts of interest.

      Compel the SEC and other U.S. Government agencies to 
provide and require more information to be made known to investors and 
fiduciaries in regard to the geographic location of companies, their 
industries or sectors, their linkages to foreign governments or foreign 
actors, the presence of companies on U.S. sanctions lists, or other 
national security, human rights, or governmental and political risk 
factors.

      Require index providers to reevaluate their index 
inclusion criteria, which currently expose U.S. investors to material 
and reputational China-specific risks and further require them to 
justify continued inclusion of any such risky China-specific 
investments.

      Harmonize U.S. sanctions policy against Chinese companies 
in order to close current gaps that exist between different sanctions 
lists. This will clarify for and assist index managers and investors in 
compliance and due diligence.

      Establish a new capital markets list from the State 
Department with sanctions coordination with the Treasury to include 
Chinese corporate human rights abusers.

      Consider a national policy to prohibit investors from 
investing--either here or abroad--in companies which have Chinese 
Communist Party (CCP) cells in their management.
                              appendices:
                           appendix a: op-ed

               [Reprinted from The Hill, March 16, 2023]

How Congress Can Compel Global Divestment from China's Forced Labor \4\
---------------------------------------------------------------------------

    \4\ Website URL: https://thehill.com/opinion/international/3903787-
how-congress-can-compel-global-divestment-from-chinas-forced-labor/
---------------------------------------------------------------------------

            By Robby Stephany Saunders, Opinion contributor

    When Beijing hosted the 2022 Winter Olympics, the world's attention 
finally focused on China's alarming human rights abuses. Since 2017, 
more than 1 million Uyghurs and other ethnic minorities have 
disappeared into a vast network of re-education camps in the far west 
region of Xinjiang, China. It's part of what the U.S. State Department 
has labeled ``genocide.'' Beijing remains undeterred by U.S. criticism, 
however, and continues to press many thousands of Uyghurs and other 
ethnic groups into slave labor.
    In December 2021, President Biden signed the Uyghur Forced Labor 
Prevention Act (UFLPA) to strengthen laws banning forced-labor products 
from entering the United States. Since then, the U.S. has enjoyed 
moderate success in seizing banned goods. And Congress has increased 
appropriations to help U.S Customs and Border Protection (CBP) fully 
implement the law.
    This was a helpful start. But plenty of goods manufactured through 
China's slave labor are still entering the United States. In part, 
that's due to an obscure section of U.S. customs law--the ``de 
minimis'' threshold for consumer imports--that allows contraband Uyghur 
products to be shipped directly to U.S. buyers.
    The current U.S. de minimis threshold is $800. That means any 
product valued at less than $800 can simply enter the U.S. without 
tariffs or scrutiny. This loophole has greatly benefited e-commerce 
vendors such as Amazon, Ali Express and Shein, since it allows goods 
produced through Uyghur labor to completely bypass border inspections.
    Equally concerning is the CBP's lack of transparency for bills of 
lading. Companies can request ``manifest confidentiality'' from the CBP 
in order to hide their import data from public view. That leaves 
competitors and public interest groups unable to adequately monitor 
imports.
    A further challenge is that the UFLPA is applied only to ``formal 
entry'' shipments valued at $2,500 or more. As a result, imports of 
lesser value can also avoid federal oversight.
    For the UFLPA to be effective, Congress must plug these holes. But 
there's still an overarching question: Why are so many popular global 
brands continuing to invest in China, particularly in Xinjiang, and 
prop up Beijing's slave labor?
    The Australian Strategic Policy Institute (ASPI) believes Uyghur 
labor is now tied to at least 82 well-known global brands, including 
Apple, BMW, Gap, Huawei, Nike, Samsung, Sony and Volkswagen. If U.S. 
lawmakers want to thoroughly tackle China's slave labor, they need to 
formally identify these corporate bad actors and link them to capital 
markets sanctions.
    This is strong medicine. But many of the multinational firms 
complicit in China's labor abuse continue to raise funds in U.S. 
capital markets. That gives Congress leverage, since lawmakers could 
block them from continuing to access America's financial markets.
    It's helpful that the UFLPA created an ``entities list'' of 
companies sourcing goods through Uyghur forced labor. But this list 
must be expanded to accurately track the companies still profiting from 
supply chains with murky roots in Xinjiang.
    What matters is hitting these companies in the wallet. 
Unfortunately, consumer boycotts are hard to organize on a global 
scale. And customer awareness is also limited because the U.S. doesn't 
require country-of-origin labeling for goods sold online.
    The answer is to identify the stocks, exchange-traded funds (ETFs) 
and mutual funds that include businesses tied to China's forced labor. 
This is where Congress holds real leverage since robust legislation 
could mean pulling these equities and investment products from 
America's financial markets. Companies tied to forced labor (as well as 
the thousands of index funds containing Chinese companies that benefit 
from forced labor) should have been targets of the UFLPA. To really 
compel action, they should now face the threat of being excised from 
America's capital markets. Such ``forced labor divestment'' is a 
necessary, realistic step to compel multinationals to decide whether to 
keep sourcing from China's slave labor (and pay the price) or clean 
house.
    U.S. investors don't want to support China's repression of Uyghurs 
in Xinjiang. It's time for Congress to force the issue by conditioning 
access to America's financial markets on ending corporate complicity in 
China's egregious human rights abuses.
                         appendix b: addendum.
new data from cpa on publicly traded, chinese-linked companies present 
        in household investment products linked to forced labor
    Methodology: The list of 5,266 publicly traded companies initially 
examined companies with publicly reported links or usage of forced 
labor in China found using open-source research. The companies 
ultimately selected for the list have reported links and are publicly 
traded, including mainland-listed stocks issued abroad. All companies 
listed are linked to oppression of ethnic minorities within Chinese 
territories. We determined that a number of these Chinese corporate 
forced labor offenders are included in popular American indices and 
investment products benchmarked against these indices.
    Disclaimer: This document reflects the CPA's own conclusions based 
on inferences drawn from an analysis of public and proprietary sources 
and is designed for general information to contribute to public 
discourse on issues of national concern. CPA disclaims, to the fullest 
extent permitted by applicable law, any and all liability for the 
accuracy and completeness of the information in this document and for 
any acts or omissions made based on such information. CPA is not 
engaged in rendering any form of professional or other advice or 
services through the publication of this report. No person or entity 
should rely on the contents of this publication without first obtaining 
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

                          Witness Biographies

    Anasuya Syam, Human Rights and Trade Policy Director, Human 
Trafficking Legal Center

    Anasuya Syam is the Human Rights and Trade Policy Director at the 
Human Trafficking Legal Center. She leads the Human Trafficking Legal 
Center's initiative on the U.S. Tariff Act and forced labor, with a 
focus on conducting investigations and submitting petitions under the 
Tariff Act. Syam works with pro bono counsel, civil society groups, 
government, and other stakeholders to push for greater accountability 
through enforcement of the Tariff Act import prohibition. She is the 
co-
author of the practice guide ``Importing Freedom: Using the U.S. Tariff 
Act to Combat Forced Labor in Supply Chains,'' which provides advocates 
with the nuts and bolts of using the Tariff Act to prevent goods made 
using forced labor from entering the United States. The guide has been 
translated into four languages. Syam has also published multiple op-eds 
and articles on the Tariff Act and forced labor. She chairs an advisory 
group of NGOs working to enhance the impact of import bans in 
addressing forced labor. Previously, Syam worked as a legal fellow at 
the World Bank with a focus on anti-corruption and corporate 
governance. She also worked as a corporate counsel in India. Syam 
received her bachelor's degree in law, with honors, from the National 
University of Advanced Legal Studies in India, and graduated with a 
master's degree in international law from NYU School of Law.

    Laura T. Murphy, Professor of Human Rights and Contemporary 
Slavery, Helena Kennedy Centre for International Justice, Sheffield 
Hallam
University

    Laura T. Murphy is a Professor of Human Rights and Contemporary 
Slavery at the Helena Kennedy Centre at Sheffield Hallam University. 
She has authored numerous books and academic articles on the subject of 
forced labor and human trafficking globally. Her current work focuses 
on forced labor in the Uyghur region of China, including in the 
automotive, solar, apparel, and building materials industries. She has 
provided expert testimony and evidence on the crisis in the Uyghur 
region to the U.S., U.K., E.U., and Australian governments, and has 
provided private briefings to government agencies, advocacy groups, law 
firms, and others interested in the issue globally. She has consulted 
for the World Health Organization, the U.S. Department of Health and 
Human Services, the U.S. Office of Victims of Crime, and the National 
Human Trafficking Training and Technical Assistance Center.

    Kit Conklin, Nonresident Senior Fellow, GeoTech Center at the 
Atlantic Council

    Kit Conklin is a nonresident senior fellow at the Atlantic 
Council's GeoTech Center and a global executive who specializes in 
issues at the intersection of technology, commerce, and international 
security. He regularly speaks on China issues, data analytics, 
international finance, and emerging technologies. In addition to his 
work with the Atlantic Council, Conklin is a vice president at the 
research and data analytics firm Kharon. Conklin previously served in 
various national security positions with the U.S. Government. He also 
supported data innovation programs at Lawrence Livermore and Pacific 
Northwest National Laboratories. Conklin holds an M.S. in emerging and 
disruptive technologies from the National Intelligence University and 
an M.A. from the Middlebury Institute of International Studies.

    Elfidar Iltebir, President, Uyghur American Association

    Elfidar Iltebir was born in Urumchi, East Turkestan and grew up in 
Istanbul, Turkiye until her family immigrated to the U.S. in 2000. As 
the daughter of a prominent Uyghur writer and intellectual, Iltebir is 
an active member of the Uyghur American community and an outspoken 
human rights activist. From 2019 to 2022, she served as the secretary 
general of the Uyghur American Association (UAA). The community 
rewarded her excellent performance in raising awareness of China's 
genocide against the Uyghurs by electing her president of the UAA in 
May 2022, a role in which she currently serves. She has a B.A. in 
Marketing from George Mason University and 20 years of experience in 
marketing and project management. She is fluent in English, Uyghur, and 
Turkish.