Does the UFLPA Cover Recycled Cotton?

Date: Tuesday, August 22nd, 2023
Source: Sourcing Journal

Is recycled cotton content in textiles and apparel scrutinized under the Uyghur Forced Protection Labor Act (UFLPA)? The short answer is yes.

“This has been a question being asked by the trade for quite some time now,” Jim Snider, manager at U.S. Customs and Border Protection (CBP), said at a Cotton Inc. webinar on forced labor on Thursday. “And the truth of the matter is we don’t have a very good answer other than most of the time recycled [cotton], where in apparel, is going to be detained and ultimately excluded because there really is no way for us or the importer to prove that forced labor was not being used.”

Cotton is a high-priority sector for enforcement under the nearly two-year-old law, which imposes a rebuttable presumption that any merchandise made in whole or in part in China’s Xinjiang Uyghur Autonomous Region is the product of forced labor and therefore inadmissible into the United States. The northwestern province supplies 90 percent of Chinese cotton, which in turn accounts for some 25 percent of the world’s share. The virgin stuff is already tough enough to trace. Ginned cotton fibers from disparate sources are frequently lumped together before they’re spun into yarn, obfuscating their points of origin. Throwing post-industrial or post-consumer waste into the mix only invites further complications if there isn’t a strict chain-of-custody system in place.

CBP, Snider said, is on the case.

“We understand the importance of recycled fibers both for the economy as well as for the environment,” he said. “And so internally we are having discussions to kind of figure out what are the best ways to handle it. It is a topic of great concern to us.”

Retail’s major trade groups, including the American Apparel & Footwear Association, banded together last year to request a carve-out for recycled content. The U.S-China Council argued for the same, saying that since companies often do not have contractual relationships with upstream suppliers, they must rely on their relationships with first or second-tier suppliers for information to obtain documentation.

“​​Supply chain mapping and due diligence challenges are only amplified for SMEs,” it said, using an acronym for small and medium-sized enterprises. “While importers are making efforts to improve supply chain transparency, this takes time and cooperation across many stakeholders.”

But Snider said that if someone were to bring in a recycled cotton article of suspect provenance today, “most likely you’re going to have that detained and ultimately excluded.”

Right now there are only two ways to dispute this: either admit to a nexus to Xinjiang but plead an exemption by proving that no forced labor was involved in the product’s manufacture, or demonstrate that it doesn’t have to ties to the region, rendering it inapplicable under the UFLPA’s purview. The former is far more challenging than the latter.

As a result, traceability has gone from nice-to-have to table stakes. While CBP hosted a tech expo earlier this year that showcased the latest technologies in supply chain transparency, from isotopic testing to DNA markers, the agency doesn’t endorse any particular platform. And for the foreseeable future, it isn’t likely to, though it’s exploring opportunities to partner with industry to pilot some of them.

“We are really interested in utilizing those technological innovations to trace the supply chain back to the origin because otherwise, we’re going to have a really tough time enforcing these laws that we need to to the best of our ability,” said Jeff Franz, international trade analyst at CBP. “And, of course, for something like forced labor, it’s a bipartisan issue, it’s a moral issue.”

CBP dropped its latest numbers on Friday. In July, the agency stopped 388 shipments valued at more than $107 million for further examination based on the suspected use of forced labor. Of these, 69, valued at more than $2.9 million, had to do with apparel, footwear and textiles.


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