U.S. House and Senate Reach Agreement on Uyghur Forced Labor Prevention Act

On December 14, 2021, lawmakers in the House and Senate announced that they had reached an agreement on compromise language for a bill known as the Uyghur Forced Labor Prevention Act or “UFLPA.”  Different versions of this measure passed the House and the Senate earlier this year, but lawmakers and Congressional staff have been working to reconcile the parallel proposals. The compromise language paves the way for Congress to pass the bill and send it to President Biden’s desk as soon as this week.

The bill would establish a rebuttable presumption that all goods originating from China’s Xinjiang region violate existing US law prohibiting the importation of goods made with forced labor. The rebuttable presumption would go into effect 180 days after enactment.  The compromise bill would also require federal officials to solicit public comments and hold a public hearing to aid in developing a strategy for the enforcement of the import ban vis-à-vis goods alleged to have been made through forced labor in China.

This rebuttable presumption will present significant challenges to businesses with supply chains that might touch the Xinjiang region.  Many businesses do not have full visibility into their supply chains and will need to act quickly to map their suppliers and respond to identified risks.  Importers must present detailed documentaton in order to release any shipments that they think were improperly detained, a costly and time-consuming endeavor.  Notably, the public comment and hearing processes will guide the government’s enforcement strategy, providing business stakeholders an opportunity to contribute to an enforcement process that could have implications for implementation of the import ban more broadly.

China’s Xinjiang region is a part of several critical supply chains, lead among them global cotton and apparel trade, as well as solar module production.  According to the Peterson Institute:

Xinjiang accounts for nearly 20 percent of global cotton production, with annual production greater than that of the entire United States. Its position in refined polysilicon—the material from which solar panels are built—is even more dominant, accounting for nearly half of global production. Virtually all silicon-based solar panels are likely to contain some Xinjiang-sourced silicon, according to Jenny Chase, head of solar analysis at Bloomberg New Energy Finance. If signed into law, the bill will send apparel producers and the US solar industry scrambling to find alternative sources of supply and prices are bound to increase.

Our team regularly counsels clients on the forced labor import prohibition, including supporting responses to Customs and Border Protection detention orders and establishing due diligence frameworks overseeing global supply chains.  Implementation of the UFLPA will present new challenges to global supply chains, necessitating a rapid response from business stakeholders across diverse supply chains.

Upcoming CLE Hosted by Thompson Reuters:  Why Is Everything Broken? Understanding Pandemic Supply Chains

Partner Sarah Rathke is pleased to present an upcoming year-end CLE in connection with Thompson Reuters entitled, “Why Is Everything Broken? Understanding Pandemic Supply Chains” on December 20, 2021 at 2:00 pm ET.  This CLE will discuss areas causing stress to supply chains including changes in consumption patterns, the labor market, global diplomatic relationships, and logistics networks around the world.  In addition, this CLE will discuss emerging supply chain trends.

Click here to register.

Cross-Post from Lexis PSL: New Environment Act demands more diligence in supply chains

This is a Cross-Post from Lexis PSL.  Please contact Anita Lloyd and Simon Garbett  with any questions.

The Environment Act 2021 (EA 2021), first introduced to Parliament in 2019, received royal assent and became law on November 9, 2021.  EA 2021 places obligations on UK businesses to prevent deforestation.  As published on Lexis PSL on November 30, 2021, our colleagues Anita Lloyd and Simon Garbett examine these new obligations and explain how attorneys play a role in assisting UK businesses in meeting the new responsibilities now in place. Read the full analysis here.


Cross-Post from cleveland.com: Why are supply chains broken? Blame the ‘black swan’ tsunami: Sarah Rathke

This is a Cross-Post from The Plain Dealer and cleveland.com.  Please contact Sarah Rathke with any questions.

In this article written by partner Sarah Rathke, she explains dramatic strain COVID-19 has put on our logistics networks worldwide and the “‘black swan’ tsunai” effecting today’s global supply-chain.

From Supply Chain Management Review: Talking Supply Chain Podcast: The Legal Blacksmith

This is from Supply Chain Management Review‘s  Talking Supply Chain Podcast.  Please contact Sarah Rathke with any questions.

Partner Sarah Rathke, who co-authored The Legal Blacksmith with Rosemary Coates, discusses the legal implications of today’s supply chain crisis including the disputes supply chain partners face due to disruptions and labor and materials shortages with Bob Trebilcock of Editorial Director of Supply Chain Management Review.

You can listen to the podcast here and can subscribe to the Talking Supply Chain Podcast wherever you get your podcasts.

 

Cross-Post from Restructuring GlobalView Blog – Supply Chain Risk and Increasing Costs: How Are UK Businesses Building Resilience?

This is a Cross-Post from the Restructuring GlobalView Blog.  Please contact Simon Garbett with any questions. 

Partner Simon Garbett discusses the impact on the supply chain following the lifting of the coronavirus restrictions in the UK.  To learn how UK businesses are addressing the supply chain issues, read the full article here.

Upcoming Webinar: Why Is Everything Broken? Understanding Supply Chains in 2021

Partner Sarah Rathke is pleased to present “Why Is Everything Broken? Understanding Supply Chains in 2021” on December 9, 2021 at 11 a.m. EDT. This webinar will discuss the causes of the current supply chain logjams, put them into historical context and will outline various paths forward.

As the holidays approach, our sponsor and our speaker would like to help the many families in need this time of year, so we are encouraging all registrants to donate to a local food bank or please consider donating to Sarah’s preferred organization, Greater Cleveland Food Bank.

If you would like to attend, please register here.

Cross-Post from Reuters: AI fixes for supply chain logjams carry legal risks

This is a Cross-Post by Reuters.  Please contact Sarah Rathke with any questions.

Partner Sarah Rathke discussed with Reuters on how A.I. and digital twin technology can aid to help solve supply chain disruptions and the potential data privacy complications companies might encounter when  sharing detailed supply chain data.  You can view the video interview here.

Cross-Post from Am Law Litigation Daily – Squire Patton Boggs Litigator and Supply Chain Expert Sarah Rathke on the ‘Mess All Over the System’

This is an article published by The Am Law Litigation Daily.  Please contact Sarah Rathke with any questions.

The global pandemic has landed the manufacturing supply chain in unchartered territory.  SPB Partner Sarah Rathke recently spoke with Am Law Litigation Daily to discuss the supply chain mess from a legal perspective.  The article here recaps the conversation on the changes and the future of supply chain disputes.

 

A New Tariff Exclusion Process For Some, But Not For All

This is a Cross-Post from the Capital Thinking Blog.  Please contact Rory Murphy and Nicole Golden with any questions.

The Biden Administration made its first step in outlining President Biden’s China trade policy including a new tariff exclusion process that will effect some.  Rory Murphy and Nicole Golden discuss the two notable takeaways from a US business perspective.  Read the full article here.

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