If your company is importing anything solely or partially created in the Xinjiang Uyghur Autonomous Region (XUAR) of China, it will be in violation of U.S. law effective June 21, 2022. This will be the presumption by U.S. Customs and Border Protection unless it is determined that the imported goods were not produced using forced labor, under the Uyghur Forced Labor Protection Act (UFLPA) that was signed into law by President Biden late last year.
This sets a high compliance standard for companies that source goods made — or contain components made — in this area of the world. The UFLPA is comprehensive in scope and seeks to prevent trading partners — foreign and domestic, first tier and sub-tier — from circumventing the law by working with middlemen, indirectly sourcing goods and products from this region, or simply claiming ignorance of the law.
There is an immediate need for companies to develop plans to assure and prove compliance with this new law. This is not, however, the only reason to uncover sources, gain transparency into business operations and determine if trading partners are ethical. There are many other environmental, social and governance (ESG) regulations coming into effect around the world.
There are five key steps your team should take as it develops processes and procedures to avoid unwitting involvement in slave labor and other unacceptable practices.
Take the First Step
It’s time to take the first step to avoid the new import penalties. The riskmethods Risk Radar maps and monitors your supply network to reveal risk in real time. Take immediate action to assure that your goods and commodities sourced in the Xinjiang Uyghur Autonomous Region of China do not include any product of slave labor. The riskmethods Risk Assessment, the professional collaboration tool, performs supplier risk surveys quickly, provides the data in the format you need and enables collaboration that lets you perform supplier risk surveys quickly.
Adapt a fully integrated supply chain management approach or assess how risks affect your entire category, not just individual suppliers. system. Be sure to incorporate a risk management component, such as the riskmethods Impact Analyzer, to get the big picture.
Invest the time to work with suppliers to explain the necessity for full disclosure about sources and to help facilitate the development of this data to avoid imposing an unacceptable burden on business partners.
Robust technology will be needed to gain sub-tier visibility. Monitoring the complex web of supply sources is simply beyond human capability. The riskmethods Supply Risk Network system can provide all your trading partners with the information and confidence they need to work as truly collaborative partners.
Even if you’ve taken all the steps that are practically available to avoid risk, there will still be exceptions in the real world that cause disruptions. The riskmethods Action Planner module taps into some 100 indices, providing options to deal with a wide range of situations. It also prioritizes risks, allowing you to focus on those that are most important and to defer actions on less important issues. It provides an action plan before you need one.
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