Welcome to Weise Wednesday! Twice a month we will share a brief Q&A with the former U.S. Commissioner of Customs, Mr. George Weise. If you have questions, we encourage you to send them to This email address is being protected from spambots. You need JavaScript enabled to view it..

 

Q: Is CBP now taking a more forceful approach to address importations made with forced labor, particularly products made with North Korean labor?

A: Yes. While a prohibition against the importation of goods made from forced labor has existed for many years (19 USC 1307), enforcement of this provision did not appear to be a priority for CBP in the past. However, recent actions by the Congress have forced CBP to place increased emphasis on enforcing this restriction.

First, section 910 of the Trade Facilitation and Trade Enforcement Act (TFTEA) of 2015 amended 19 USC 1307 by eliminating the so-called “consumptive demand” exception to the provision and stressed the importance of enforcing our laws against the use of forced labor. The consumptive demand exception had allowed companies to import goods made with forced labor if the demand for the product exceeded the capacity for U.S. domestic production.

More recently, section 321 (b) of the Countering America’s Adversaries Through Sanctions Act (CAATSA) , enacted in August, reversed the burden of proof for imported goods produced in whole or in part with North Korean labor. It requires CBP to prohibit under 19 USC 1307 any “significant goods, wares, articles and merchandise mined, produced or manufactured wholly or in part by the labor of North Korean citizens or nationals” unless the importer can demonstrate by “clear and convincing evidence” that North Korean forced labor was not involved in the production of the merchandise. This provision has broad implications because it prohibits not only goods imported directly from Korea with Korean labor, but also goods imported from any country made with such labor.

 

New guidance from CBP

On November 7, CBP issued new guidance on complying with these prohibitions. CBP reminded importers of their “obligation to exercise reasonable care and take all necessary and appropriate steps” to ensure that goods entering the United States comply with these provisions. The guidance referenced several newly updated CBP publications to assist importers in their understanding of their obligations under the provisions, including an updated section of their Informed Compliance publication on Reasonable Care devoted to Forced Labor and a fact sheet relating to Forced Labor Due Diligence.

Importers are strongly urged to review these CBP documents carefully and implement processes and procedures to ensure that imports are not produced by citizens of North Korea or other forced labor. Additionally, the Department of Labor produces a list each year of goods they believe may be produced by forced labor. Companies should take the necessary steps to assess to what extent their current supply chains include goods of this nature. If necessary, consult with your attorneys and/or trade experts to avoid future problems. 

There are also a number of software tools that can help address the challenges resulting from these new requirements. Reach out to your software provider to learn more about how these tools can help.