Strongest US Action to Date on Xinjiang Cotton

To:WRC Affiliate Universities and Colleges
From:Scott Nova
Date:December 7, 2020
Re:Strongest US Action to Date on Xinjiang Cotton

US Customs and Border Protection (CBP) has taken its strongest action to date on the forced labor crisis in Xinjiang, issuing an import ban on a huge volume of apparel containing Xinjiang cotton. This new order has major implications for licensees, and the best way for licensees to comply, with respect to university apparel, is to follow the guidance provided by the WRC in July, designed to ensure licensees are eliminating Xinjiang cotton from the collegiate supply chain.

On Wednesday, December 2, CBP issued a Withhold Release Order barring US entry of any product containing cotton made by the Xinjiang Production and Construction Corps (XPCC), a Chinese government paramilitary body with a long history of human rights abuses. The XPCC controls one third of Xinjiang cotton. The ban applies to garments containing XPCC cotton regardless of where the final product is sewn and covers imports from Bangladesh, Vietnam, Indonesia, etc., as well as China. The WRC estimates that US brands and retailers import more than half a billion garments annually containing XPCC cotton. All such imports are now barred, until and unless the importer can supply concrete proof no forced labor was used in their manufacture. Although CBP’s forced labor enforcement has been spotty in the past, the agency has pledged energetic enforcement of Wednesday’s action.

Given the XPCC’s huge economic footprint and the practical difficulty of distinguishing XPCC from non-XPCC cotton, it will be hard for brands to continue sourcing any cotton from Xinjiang without running afoul of the new regulation. This briefing paper from a law firm advising importers underscores the dangers for corporations. Since the risk of forced labor is high at any cotton farm in Xinjiang, the new order provides one more compelling reason for brands to exclude all Xinjiang content from their supply chains. As you know, the WRC has already asked licensees to do so for collegiate apparel, and it is our view that all apparel brands should follow suit.