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Xinjiang Cotton Faces Sweeping New Western Sanctions

The United States has imposed a sweeping regional ban on all cotton products and tomatoes from the Xinjiang Uyghur Autonomous Region in northwestern China, where authorities are widely believed to hold at least 1.8 million Uyghurs, Kazakhs and other Turkic Muslim minorities in internment camps and prisons as part of a broader campaign of religious and cultural oppression.

The move, announced by U.S. Customs and Border Protection (CBP) on Wednesday, is just the latest salvo in a series of sanctions targeting Beijing and its use of extrajudicial imprisonment, torture, forced sterilization, forced labor and other repressive measures to mold ethnic minority groups into model Communists—claims the Chinese government has vociferously denied. A recent study by the Center for Global Policy, a Washington, D.C.-based think tank, estimates that half a million Uyghurs are forced to pick cotton by hand through a state-sponsored labor transfer and “poverty alleviation” scheme.

“CBP will not tolerate the Chinese government’s exploitation of modern slavery to import goods into the United States below fair market value,” acting commissioner Mark A. Morgan said in a statement. “Imports made on the cheap by using forced labor hurt American businesses that respect human rights and also expose unsuspecting consumers to unethical purchases.”

Importers will be responsible for ensuring that the products they plan to import do not exploit forced labor at any point along their supply chain, including the production or harvesting of the raw material.

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Ken Cuccinelli, acting deputy secretary of the Department of Homeland Security, told reporters at a briefing that “‘Made in China’ doesn’t just indicate country of origin—it’s a warning label.” He used the same turn of phrase in October, when the CBP issued a Withhold Release Order (WRO) on cotton merchandise from the Xinjiang Production and Construction Corps (XPCC), a paramilitary organization that produces one-third of China’s cotton, employs 12 percent of Xinjiang’s population and generates 17 percent of the region’s gross domestic product.

This more encompassing ban formalizes what Morgan had described at the time as “almost akin to a regional [WRO]” because of the scale of the XPCC’s operations. With Xinjiang accounting for some 85 percent of China’s cotton, the regional ban will effectively impact 20 percent of the apparel industry’s global cotton supply.

In January, the Fair Labor Association, a multi-stakeholder initiative whose affiliates include Adidas, Uniqlo owner Fast Retailing, Gildan, Hanesbrands, Lululemon, Nike, Patagonia and Under Armour, blacklisted any sourcing and production of goods, whether directly or indirectly, from Xinjiang, citing the “unique human rights and labor violations that defy conventional due diligence norms.”

The United States imported $9 million in cotton products from China in 2020, Brenda Smith, executive assistant commissioner at the Office of Trade, said in the briefing. Worker Rights Consortium (WRC), a labor-rights group and member of the Coalition to End Forced Labour in the Uyghur Region estimates that U.S. brands and retailers import more than 1.5 billion garments that contain Xinjiang cotton every year, accounting for more than $20 billion in retail sales. These include items exported from countries such as Bangladesh, Cambodia and Vietnam, as well as the rest of China—every one of which is “now barred from entry.”

“CBP’s action is a high-decibel wake-up call to any apparel brand that continues to deny the prevalence and problem of forced-labor produced cotton from the Uyghur Region,” said Scott Nova, executive director at the WRC. “This ban will redefine how the apparel industry—from Amazon to Nike to Zara—sources its materials and labor. Any global apparel brand that is not either out of Xinjiang already, or plotting a very swift exit, is courting legal and reputational disaster. The days when any major apparel brand can safely profit from Xinjiang cotton are over.”

It’s now up to the incoming Biden administration and new Congressional leadership, Nova said, to “up CBP’s game on enforcement.”

“The complexity and opacity of the brands’ supply chains create major challenges and CBP’s track record on enforcement is mixed, but it can be done,” he said. “The effective and transparent enforcement of this order should be among the immediate regulatory priorities of the new administration.”

Likewise, the Uyghur Human Rights Project, a Washington, D.C., nonprofit that promotes human rights and democracy for Uyghurs, also welcomed the decision.

“This is the right decision, and more steps are needed,” executive director Omer Kanat said in a statement. “UHRP has been calling for a complete ban on imports tainted by China’s atrocity crimes against Uyghurs. With the genocidal campaign that is soon to enter its 5th year, Uyghurs don’t understand how ‘business as usual’ has continued as long as it has.”

In a joint statement, the American Apparel & Footwear Association, National Retail Federation, Retail Industry Leaders Association and the U.S. Fashion Industry Association said that the announcement dovetails with its members’ “accelerated commitment in this region,” and it looks forward to working with the new Congress to develop a “holistic approach that provides all stakeholders a clear, effective, and enforceable path forward.” It urged CBP officials, however, to share the evidence they gathered, and the evidentiary thresholds they employed, that resulted in the decision.

“The industry is pioneering and implementing new technologies and innovative approaches to decipher where supply chains are susceptible to forced labor, particularly as it relates to XUAR,” the statement said. “We look forward to working with U.S. Customs and Border Protection to make sure enforcement is smart, transparent, targeted and effective. … Additionally, we ask CBP to share enforcement actions so that industry can further inform their due diligence and amplify and expand CBP’s enforcement efforts.”

The National Council of Textile Organizations said it is closely reviewing the scope of the Xinjiang cotton and cotton product ban and the “associated enforcement mechanisms announced by DHS today.”

“The abuses against the China’s Uyghur Muslim population are well-documented, having spurred both congressional action and several withhold release orders in recent months by U.S. Customs and Border Protection,” said president and CEO Kim Glas in a statement. “It is critical that forced labor in China and the systemic abuse of the Uyghurs and other minority groups is abolished and systematically addressed.”

The news came just as the British government announced new measures to ensure that U.K. companies do not profit from forced Uyghur labor, including “new, robust and detailed guidance” about the specific risks faced by companies with links to Xinjiang and the challenges of conducting effective due diligence in the region. It will also introduce fines for firms that fail to disclose imports tied to Xinjiang.

“Our aim, put simply, is that no company that profits from forced labor in Xinjiang can do business in the U.K., and no U.K. business is involved in their supply chains,” Foreign Secretary Dominic Raab wrote in a statement to the House of Commons on Tuesday. The government will also be conducting an “urgent review” of export controls as they apply specifically to Xinjiang to prevent exports that could directly or indirectly contribute to human-rights violations.

“Let me say that we in the United Kingdom–I think rightly–take pride in the overwhelming majority of British businesses that do business, do so with great integrity and professionalism right around the world. That’s their hallmark, it’s part of our USP [unique selling point] as a Global Britain,” Raab said. “It is precisely because of that, that any company profiting from forced labor will be barred from government procurement in this country.”

Venerable British department store Marks & Spencer said earlier this month that while it has neither suppliers in nor sourcing relationships with Xinjiang, it backs a call to divest from the region entirely.

“At M&S, sourcing ethically and sustainably is core to how we do business and the promise we make to our customers, that’s why we do not source cotton from Xinjiang,” Richard Price, its managing director of clothing and home, said in a statement. “When it comes to sustainable and ethical clothing, we can only achieve real change at scale by working with others, which is why we are proud to be formally supporting the coalition and providing additional assurance to our customers they can purchase from M&S with confidence.”