CBP Issues ‘Forced Labor Finding’ on Malaysia-Made Gloves

Date: Friday, April 2nd, 2021
Source: Sourcing Journal

U.S. Customs and Border Protection (CBP) reported Monday that it has directed personnel at all U.S. ports of entry to seize disposable gloves produced by Top Glove Corporation Bhd. in Malaysia after obtaining “sufficient information” that the company uses forced labor in the production of the items.

The CBP Office of Trade, in collaboration with the Secretary of the Treasury, published a “forced labor finding” in both the Customs Bulletin and in the Federal Register announcing its determination that certain disposable gloves have been “mined, produced or manufactured” in Malaysia by Top Glove “with the use of convict, forced or indentured labor, and are being, or are likely to be, imported into the United States.”

“Today’s forced labor finding is the result of a months-long CBP investigation aimed at preventing goods made by modern slavery from entering U.S. commerce,” Troy Miller, senior official performing the duties of the CBP Commissioner, said in a statement. “CBP will not tolerate foreign companies’ exploitation of vulnerable workers to sell cheap, unethically made goods to American consumers.”

The finding is an expansion of a Withhold Release Order, issued last July, that detained the same products based on “reasonable but not conclusive” evidence of multiple forced labor indicators in Top Glove’s manufacturing, debt bondage, excessive overtime, retention of identity documents and abusive working and living conditions.

“CBP has taken steps to ensure that this targeted enforcement action against Top Glove will not have a significant impact on total U.S. imports of disposable gloves,” said John Leonard, CBP acting executive assistant commissioner for trade. “We continue to work with our interagency partners to ensure that the personal protective equipment, medical devices and pharmaceuticals needed for the Covid-19 response are cleared for entry as expeditiously as possible while verifying that those goods are authorized and safe for use.”

The action against Top Glove is the second forced labor finding that CBP has issued within fiscal year 2021. The first, imposed in October against stevia extracts and derivatives from Inner Mongolia Hengzheng Group Baoanzhao Agriculture, Industry, and Trade Co., Ltd., was in turn, the first forced labor finding since 1996.

A New York Times investigation in December described lax pandemic precautions, “appalling” working conditions, unsanitary and crowded accommodations and “an atmosphere of fear” in which workers worried over losing their jobs if they spoke out.

“Today’s finding tells U.S. importers who fail to eliminate forced labor from their supply chains that their shipments may be subject to seizure and forfeiture,” Brenda Smith, executive assistant commissioner of CBP’s Office of Trade, said at the time. “We hope this action encourages importers to take a close look at their supply chains to ensure that they meet the humane and ethical standards of the United States government.”

Section 307 of the 1930 Tariff Act prohibits the importation of merchandise mined, manufactured or produced, wholly or in part, by convict labor, forced labor, and/or indentured labor, including forced or indentured child labor. Goods suspected of being imported in violation of the statute are detained by CBP.

An importer can challenge a CBP finding and request the release of a particular shipment by providing satisfactory evidence that the product was not the result of forced labor, such as a certificate of origin or a “sufficiently detailed” statement detailing the importer’s due-diligence efforts, along with “proof” that the goods were not produced, wholly or in part, with forced labor.

Manufacturers in Malaysia are leading suppliers of personal protective equipment and supply some 60 percent of the world’s latex medical gloves, which have become even more essential during the pandemic. Top Glove, which bills itself as the world’s largest manufacturer of disposable gloves, controls roughly one-quarter of the global rubber glove market, producing 42 billion gloves a year for export to 200 countries.

A spokesperson for Top Glove said the company is reviewing CBP’s finding and its U.S. counsels are and its US counsels are “liaising with CBP’s representatives for sufficient information to meaningfully address the issuance of the recent finding.”

“Top Glove understands the concerns of all our stakeholders, including CBP, to ensure that forced labor is not present in the manufacturing of gloves and personal protective equipment,” the spokesperson said. “This is the company’s shared top priority, and it seeks to resolve any ongoing areas of concern immediately.”

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