U.S. Border and Customs Protection (CBP) has established an isotopic testing lab in Savannah, Ga., with similar setups in New York City and Los Angeles to follow in “six to eight months.”
The move, revealed by Eric Choy, the agency’s executive director for trade remedy and law enforcement, at a House Committee on Homeland Security hearing on Thursday, offers the strongest signal since the advent of the Uyghur Forced Labor Prevention Act (UFLPA) of a ramp-up in the crackdown on forced labor-tainted cotton from China’s Xinjiang Uyghur Autonomous Region. It also suggests that the forensic analysis, which can identify or rule out a sample’s point of origin by comparing its chemical signature with that of its suspected environment, will become more routine.
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CBP, tapping into resources from Congress, acquired the necessary equipment in fiscal year 2022 and is currently in the process of receiving and installing it, Choy noted. This means that the agency can reduce its reliance on the third-party services of Oritain, a New Zealand-based traceability company that has been on a retainer amounting to $1.3 million since 2020, according to records obtained by Reuters through the Freedom of Information Act, or FOIA.
“We’ve got staff and scientists that we’ve brought on board to do that and that will increase our capacity,” he said. “We anticipate doing more isotopic testing and we’ll leverage that isotopic testing to investigate where we see allegations of risk or forced labor, or in the case of XUAR cotton, where it may be used in the supply chain.”
Choy told Reuters in June that officials at individual ports can request tests if they field allegations about particular shipments or have an inkling that the goods have a nexus to Xinjiang, whose predominantly ethnic Muslim population has been subject to a state-sponsored campaign of repression and coercion that many have described as genocide. A series of tests conducted by CBP through May, the results of which Reuters also obtained through a FOIA request, flagged 13 of 86 garments, or 15 percent of the batch, as “consistent” with Xinjiang cotton despite the UFLPA’s rebuttable presumption that bars goods from the province from entering the United States.
“I am not surprised how many products from Xinjiang are still entering the U.S., given the complexity of the supply chains and Beijing’s obfuscation strategies,” Adrian Zenz, a senior fellow in China studies at the Victims of Communism Memorial Foundation, told Sourcing Journal in September. “This shows that much more needs to be done to effectively enforce the UFLPA.”
In a letter to Alejandro Mayorkas, secretary of homeland security dated Nov. 29, Virginia congresswoman Jennifer Wexton voiced concern that the “vital” tool that is isotopic testing is “being underused as well as inefficiently targeted.”
“Congress appropriated funds specifically for the acquisition and use of new technologies like isotopic testing of cotton fibers and cotton-containing products, which is an essential tool for catching contraband cotton at all stages of production,” she said. “CBP’s toolbox of technologies like isotopic testing has been funded and should play a substantial, integral part of a proactive UFLPA enforcement regime. At the same time, the department should engage with multiple testing vendors to boost testing capacity and drive cost savings, maximizing available appropriations.”
Choy didn’t mention if CBP will still be using the services of vendors to test suspicious freight. What he did say, however, is that samples could be pulled from a shipment that has been detained or during surveillance of specific shipment lines. He wasn’t able to answer a question about how long testing would take, though the process of whisking an item from a port to the Georgia lab should be “fairly quick” with express carriers.
How to improve enforcement of the UFLPA was the overarching theme of the hearing, which brought as witnesses in addition to Choy, Christa Brzozowski, assistant secretary for trade and economic security at the Department of Homeland Security, and Thea Lee, deputy undersecretary for international labor affairs at the Department of Labor.
While Choy described CBP’s forced labor enforcement efforts as “robust and effective,” he also admitted to challenges, such as the “record level” of de minimis or low-value shipments that contain less detailed data for customs review under the UFLPA. In 2022, CBP greenlit more than 685 million de minimis shipments, each less than $800 in value, with insufficient data to properly ascertain risk, or 67 percent more than it did in 2018. Temu and Shein alone are responsible for almost 600,000 packages a day, according to a House Select Committee on the Chinese Communist Party report on the e-commerce giants, which it published in June.
“The agency is working closely with DHS to develop strategies to address these challenges and include regulatory changes to increase data collection and technology enhancements to improve risk management and targeting,” he said.
Among the strategies being considered is a broader integration of tools such as CBP’s Advanced Trade Analytics Platform, which brings in a “significant” amount of government, public and open-source data to help it identify risks within the supply chain. “We’re also looking at opportunities to advance our automated commercial environment, where all trade transactions occur, which needs to be modernized and we have efforts underway to modernize that to keep pace with the advancements the industry has made and global trade overall,” Choy added.
The issue with de minimis cargo, he said, is the dearth of information that customs gathers as compared with traditional shipments. Since 2019, the agency initiated two pilot programs, the first of which involves a new entry type for de minimis shipments. The second scheme looked at what additional data elements would be useful for CBP to understand “who are the parties within the shipment, what’s inside the box and who the customers are.”
“We’ve come to the culmination of those data pilots and we’re working to introduce different ways to file entries for de minimis shipments and what data elements we would require for de minimis shipments,” Choy said. “That kind of expanded information and data for each of the shipments would give us…greater access for our targeting systems to be able to identify and be able to stop specific shipments coming in at our ports of entry.”
Nearly 17 percent of all shipments stopped by CBP for UFLPA review since June 2022, when the law came into effect, are textiles, including apparel and footwear, and roughly 63 percent of these shipments were ultimately denied for non-compliance. Despite rumblings among the industry about whether this accuracy rate is too low, calling into question whether the hits justify the misses, enforcement is only going to intensify.
“We agree 100 percent that we need to scale that,” Brzozowski said. “Work since enactment has really been focused on setting up a robust and methodological process. But I am confident that we’re now at the point where we can turn those wheels and move forward much quicker as to what metrics we’re using and how we’re measuring success.”
This, she said, will apply to the Entity List, a forced labor blacklist that started with 20 companies and has since added 10 more for a total of 30, a number that lawmakers have expected to grow faster. Among the most recent lot was Anhui Xinya New Materials Co., a yarn spinner that was immediately suspended by the U.S. Cotton Trust Protocol for its inclusion. Better Cotton confirmed this week that it has also suspended the company, since it has remained on the list for more than 30 days.
Brzozowski agreed that the size of the Entity List “might not reflect” the size of the problem the UFLPA seeks to attack, but that the department has done a “very impressive job” setting up a “robust methodology” that is “going to stand not only the test of time but legal scrutiny.” She confirmed that listed parties can move to sue the U.S. government.
“There is an active pipeline of recommendations being developed now by the task force,” she said, referring to the inter-agency Forced Labor Enforcement Task Force. “DHS is conducting a strategic review of every aspect of this process. We’re working closely with our colleagues across the members of the task force and our goal is to identify process improvements that can result in a transparent, consistent and, importantly, scalable process that will allow us to significantly increase the numbers of entities included on the Entity List.”
