For the first time, in November 2023 the U.S. Court of International Trade ruled that it has jurisdiction to hear an appeal of a U.S. Forced Labor Enforcement Task Force (“FLETF”) decision to place a company on the U.S. Uyghur Forced Labor Prevention Act (“UFLPA”) Entity List (CIT Court No. 23-182). The outcome of the litigation — commenced by China-based printer maker Ninestar Corp. — could have far-reaching implications for importers who experience detention or seizure as a result of their suppliers being included on the UFLPA Entity List.
The litigation follows the FLETF’s June 2023 announcement that it would add Ninestar and its eight Zhuhai-based subsidiaries to the UFLPA Entity List “for working with the government of Xinjiang to recruit, transport, transfer, harbor or receive forced labor or Uyghurs, Kazakhs, Kyrgyz, or member of other persecuted groups out of Xinjiang.” The UFLPA, originally implemented in June 2022, established a rebuttable presumption that all merchandise coming from the Xinjiang region of China (“XUAR”) is a product of forced labor. The UFLPA Entity List is a consolidated register of the four lists required to be developed and maintained pursuant to Section 2(d)(2)(B) of the Uyghur Forced Labor Prevention Act.
Under the UFLPA, CBP is not currently required to disclose the specific reason for detention or seizure of an importer’s goods. However, CBP must announce in the Federal Register each time it adds a company to the Entity List. CBP typically does not share specific information to protect informants’ safety. Ninestar’s amended complaint argued that CBP in fact relied “on untenable inferences drawn from long-stale materials that pre-date enactment of the UFLPA.” The Court is expected in the months ahead to consider Ninestar’s arguments challenging its addition to the UFLPA Entity List.
The outcome of the Ninestar litigation could have significant implications for the future enforcement of the UFLPA. If the Court rules in favor of Ninestar, CBP may be compelled to make more transparent future FLETF proceedings and decisions. Given the potential consequences of being associated with the UFLPA Entity List, importers are likely to monitor the Court’s decision in this case. The case also may inspire other companies to challenge CBP’s UFLPA enforcement.
To remain compliant with the UFLPA, importers are advised to map their supply chains to the point of origin for the products they ultimately import into the United States. If forced labor is used in any stage of production — including a discreet material or component incorporated in the finished product — that product may be subject to detention by CBP.
Please contact CLK’s customs and supply chain compliance team if you have questions or require assistance.