Lawmakers Chide US Firms on China Ties

Congressional lawmakers chided US corporations for continuing to do business with China, saying that some firms are subsidizing Beijing’s human rights abuses, including forced labor.

It is unacceptable if any US business subsidizes China’s use of forced labor, violence against its citizens and theft of US intellectual property, Sen. Jeff Merkley (D-Ore) said at a July 11 hearing by the Congressional-Executive Commission on China.

US companies need to diversify their supply chains so that they are less dependent on China for critical inputs, he said.

Commission Chair Chris Smith (R-NJ) said that far to many corporate leaders have embraced Beijing under the false idea that greater trade would led to a true-opening up of China’s economy. He urged support for his legislation to end permanent normal trade relations for China, which he said was a mistake.

Congressional concern about China’s human rights abuses led to passage last year of the Uyghur Forced Labor Protection Act, Rep. Smith comments.

Homeland Security Undersecretary for Strategy, Policy and Plans Robert Silvers told the commission that early enforcement of UFLPA has been “speedy, strong and surgical.” Since the law took effect, Customs and Border Protection has targeted over 4200 shipments valued at more than $1.4 billion, he said.

De Minimis Challenge
But is facing challenges, including the difficulty of dealing with de minimis shipments and the need for additional resources, according to Mr. Silvers.

An effort is underway in Congress to eliminate the $800 de minimis threshold for duty-free entry of packages into the United States. Lawmakers say China is taking advantage of de minimis to export products – including those made with forced labor – without having to pay tariffs.

Mr. Silver, who chairs the task force on forced labor created under UFLPA, said he shares those concerns. While UFLPA applies to de minimis shipments, the fact that such shipments require less data makes CBP’s targeting and enforcement work more difficult.

Some two to three million de minimis shipments are received every day, which challenges not only enforcement on forced labor, but also of contraband and counterfeit products.

In response, the task force has developed short, medium and long-term strategies, Mr. Silver said.

In the short term, new software is being utilized that could help with targeting shipments. In the medium term, the task force is looking at possible regulatory changes and in the long term, dealing with products made with forced labor will be built into CBP’s plans to create a 21st century customs framework.