UFLPA – Separate Entity List, PVC Gets a Pass


UFLPA – Separate Entity List, PVC Gets a Pass

 

The Ughyur Forced Labor Prevention Act (UFLPA) became effective June 21. The Act establishes a rebuttable presumption that goods mined, produced, or manufactured wholly or in part in Xinjiang or by an entity on the UFLPA Entity List are prohibited from U.S. importation under 19 U.S.C. § 1307. 

 

If an importer of record can demonstrate by clear and convincing evidence that the goods in question were not produced wholly or in part by forced labor, fully respond to all CBP requests for information about goods under CBP review and demonstrate that it has fully complied with the guidance provided, the Commissioner of CBP may grant an exception to the presumption. 

CBP Operational Guidance for importers includes specific supply chain documentation to submit for “high-enforcement priority” commodities with a high-risk of forced labor.   Examples for Cotton, Tomatoes and Polysilicon are included in the CBP Strategy Document (Xinjiang produces about one-fifth of the world’s cotton and about half of the world’s polysilicon). 

The fourth “high-enforcement priority” sector- Textiles - represents a more complex enforcement challenge.  A 2021 USAID- funded Sheffield Hallam University study detailed the practice of PRC textile companies that, although not using forced labor in their own mid-tier third country facilities, rely on prohibited Xinjiang raw materials or semi-finished goods. 

There is no mention of Polyvinyl Chloride Resin (PVC), the manufacture of which is a major source of coerced employment and environmental damage in Xinjiang.  An effective ban of UFLPA non-compliant PVC would profoundly rock the building materials supply chain.

 

Laura Murphy, Professor of Human Rights and Contemporary Slavery at Sheffield Hallam University recently published with others a comprehensive study of the downstream supply chain associated with Xinjiang Zhongtai Chemical Company, a Chinese government-owned petrochemical firm that is world’s second largest manufacturer of PVC.

 

“Xinjiang Zhongtai ships to manufacturers in Vietnam, Indonesia, India, the Philippines, U.A.E., Singapore, and Russia. Those companies then ship PVC-based flooring, pipes and fittings, and electronics coverings to the U.S., U.K., Hong Kong, Myanmar, Singapore, China, Taiwan, Belize, Nepal, Tanzania, Seychelles, Bhutan, Zambia, Sierra Leone, Indonesia, Sri Lanka, and Iraq. Caustic soda goes on to be used in manufacturing in Canada, the U.S., India, Spain, Denmark, Hong Kong, England, Russia, Germany, Mexico, Poland, Australia, and the P.R.C.”


CBP will employ a “risk-based approach, dynamic in nature, that prioritizes the highest-risk goods based on current data and intelligence.” According to CBP the” highest-risk goods” include those imported directly from Xinjiang into the United States and from entities on the UFLPA Entity List. 

Volume / Issue July 2022 - Vol 36, Num 7


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