OT-RR:BSTC:CCR H330077 DMK
Eric A. Batt
Center Director
U.S. Customs and Border Protection
Apparel, Footwear & Textiles CEE
555 Battery Street, Room 401
San Francisco, CA 9411
RE: Application for Further Review of Protest No. []; as [] 0; 19 U.S.C. § 1307; 19 U.S.C. § 1595a(c)(2)(A); Xinjiang Uyghur Autonomous Region Withhold Release Order; Merchandise Manufactured with Forced/Indentured labor.
Dear Director Batt:
This is in reference to the Application for Further Review (“AFR”) of Protest No. [ ]. Our advice is requested as to whether the exclusion of [] cartons of certain wearing apparel at the Port of Newark, New Jersey, was in compliance with 19 U.S.C. § 1307, which prohibits the importation of merchandise made with forced labor. [ ], (“Importer”) has protested the detention of their merchandise. Our determination is set forth below.
FACTS:
The following facts have been extracted from the detention notice, the exclusion letter, the entry documents, the protest, and attached exhibits, as well as internal CBP documentation.
On January 13, 2021, the Executive Assistant Commissioner of CBP’s Office of Trade issued a withhold release order (“WRO”) directing all port personnel to withhold the release (i.e., detain) of all cotton and tomatoes and their downstream products produced in whole or in part in the Xinjiang region of the People’s Republic of China, including downstream products produced outside the Xinjiang region that incorporate these inputs. In issuing the WRO, CBP determined the information available reasonably indicated there was forced labor present in the supply chains of cotton and tomato products from the Xinjiang Uyghur Autonomous Region (“XUAR”). The WRO listed all products of this type produced in the XUAR as suspected to be made with forced labor.
On April 17, 2022, the merchandise at issue in this case, consisting of [] pieces fabric combination pullovers were entered at the port of Newark, New Jersey. On April 21, 2022, CBP detained the merchandise under a suspicion that the merchandise was subject to the WRO and issued a detention notice to the Importer. The entry documentation, including the commercial invoice, packing list, certificates of origin, and bill of lading listed the seller and manufacturer of this merchandise as
[ ], and the importer of record as Importer.
On August 5, 2022, Importer sent CBP a request for release of the merchandise, including supply chain tracing documentation for the merchandise at issue. On August 23, 2022, CBP determined that the information Importer provided failed to demonstrate, by satisfactory evidence, that no forced labor was used in the manufacturing of the merchandise, and recommended the merchandise be excluded from entry. CBP sent Importer an Exclusion Letter regarding the subject merchandise on August 29, 2022.
On February 10, 2023, Importer filed a protest and supporting documentation pursuant to 19 U.S.C. § 1514(a)(4). This ruling is provided as further review pursuant to 19 C.F.R §§ 174.23 and 174.26.
LAW AND ANALYSIS:
As a preliminary matter, we determine that the protest was timely received on February 10, 2023, within 180 days from August 29, 2022, the date of mailing of the exclusion letter.1F1F1F In addition, Importer as importer of the subject merchandise, has a clear interest in the merchandise sufficient to submit the protest.2F2F2F
Title 19 of the United States Code, § 1307 (19 U.S.C. § 1307), provides, in pertinent part:
All goods, wares, articles, and merchandise mined, produced, or manufactured wholly or in part in any foreign country by convict labor or/and forced labor or/and indentured labor under penal sanctions shall not be entitled to entry at any of the ports of the United States, and the importation thereof is hereby prohibited, and the Secretary of the Treasury is authorized and directed to prescribe such regulations as may be necessary for the enforcement of this provision.
“Forced labor”, as herein used, shall mean all 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 voluntarily. For purposes of this section, the term “forced labor or/and indentured labor” includes forced or indentured child labor.
Accordingly, for purposes of section 307 of the Tariff Act, forced labor consists of three elements: (1) work or service occurring in any activity, industry, or sector, including the informal economy; (2) penalty or threat of penalty used to compel someone; and (3) involuntariness.3F3F
The International Labour Organization (ILO) developed eleven indicators of forced labor to assist organizations and law enforcement to ascertain when a situation amounts to forced labor and identify persons who are trapped in a forced labor employment environment. These indicators include abuse of vulnerability, deception, restriction of movement, isolation, physical and sexual violence, intimidation and threats, retention of identity documents, withholding of wages, debt bondage, abusive working and living conditions, and excessive overtime.5F4F According to the ILO, the presence of a single indicator in a given situation may, in some cases, indicate the existence of forced labor in the supply chain, and, in other cases, several indicators taken together may indicate forced labor.
The Customs Regulations promulgated pursuant to 19 U.S.C. § 1307 are found at title 19, Code of Federal Regulations, §§ 12.42-12.45 (19 C.F.R. §§ 12.42-12.45). Specifically, 19 C.F.R. §§ 12.42(e—g) provide:
(e) If the Commissioner of CBP finds at any time that information available reasonably but not conclusively indicates that merchandise within the purview of section 307 is being, or is likely to be, imported, he will promptly advise all port directors accordingly and the port directors shall thereupon withhold release of any such merchandise pending instructions from the Commissioner as to whether the merchandise may be released otherwise than for exportation.
(f) If it is determined on the basis of the foregoing that the merchandise is subject to the provisions of the said section 307, the Commissioner of CBP, with the approval of the Secretary of the Treasury, will publish a finding to that effect in a weekly issue of the Customs Bulletin and in the Federal Register.
(g) Any merchandise of a class specified in a finding made under paragraph (f) of this section, which is imported directly or indirectly from the locality specified in the findings and has not been released from CBP custody before the date of publication of such finding in the Federal Register shall be considered and treated as an importation prohibited by section 307, Tariff Act of 1930, unless the importer establishes by satisfactory evidence that the merchandise was not mined, produced, or manufactured in any part with the use of a class of labor specified in the finding.
Thus, to issue a WRO, i.e., detention order, CBP must have information that “reasonably but not conclusively indicates” that merchandise (1) falls within the purview of section 1307, and (2) is being, or is likely to be, imported into the United States. See 19 C.F.R § 12.42(e).6F5F After issuance of a WRO, any imported shipment suspected of violating the order will be detained and excluded from entry into the United States unless the importer demonstrates that the merchandise does not violate 19 U.S.C. §1307, or exports said merchandise prior to seizure or before a Finding is issued. See 19 C.F.R. § 12.42 –12.44.
Upon review of the record, we determine that Importer did not provide satisfactory evidence that the goods detained pursuant to the WRO were not manufactured with forced labor or, in the alternative, were not subject to the WRO. Importer did not provide sufficient evidence to establish that their goods were not produced wholly or in part with forced labor. Additionally, Importer failed to establish that their supply chain is not linked with the XUAR and, therefore, did not provide satisfactory evidence that the goods fell outside of the scope of the WRO.
To demonstrate that the goods were both free of forced labor indicators and not subject to the WRO, Importer provided supply chain tracing information, showing that the no step of the manufacturing process occurred within the XUAR. Specifically, Importer provided certificates of origin, sales contracts, commercial invoices, proof of payment, supply certificates, transaction certificates, maps, and graphs showing that the raw cotton was produced in India, processed into yarn and subsequently fabric in China outside the XUAR, and converted to clothing in Cambodia.
However, internal CBP documents show that one of the companies in the supply chain is linked with the XUAR. Specifically, [[ entities, connection between entities ]] an entity subject to the WRO. Documents show that [[ entities ]] have met to discuss [[ discussions ]] and that [[ discussions ]]
After reviewing all the documents for the supply chain as well as the internal CBP documents showing the link between the supply chain and the XUAR, we determine that Importer did not provide sufficient evidence to establish either that the goods were not produced, wholly or in part, with forced labor or, in the alternative, that their supply chain is not linked with the XUAR. Accordingly, we determine that the merchandise was subject to the WRO and therefore it is appropriate to exclude the merchandise.
HOLDING:
Based on the above, we find that Importer failed to provide satisfactory evidence that the goods detained pursuant to the WRO were not manufactured with forced labor or, in the alternative, establish that their supply chain is not linked with the XUAR to demonstrate that their shipment is not subject to the WRO. Accordingly, the merchandise is inadmissible in violation of 19 U.S.C. § 1307. Merchandise that is detained as subject to the WRO is subject to exclusion. In accordance with applicable regulations set forth in 19 C.F.R. § 12.44(a), the merchandise is excluded from entry. You are instructed to deny the protest. Should you have any questions regarding this matter, please contact David Krawiec of my staff at [email protected].
Sincerely,
W. Richmond Beevers
Chief, Cargo Security, Carriers and Restricted Merchandise Branch
Office of International Trade, Regulations and Rulings
U.S. Customs and Border Protection