Seal of the United States Department of Homeland Security.
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The US has added two new Chinese companies to its Xinjiang trade blacklist over forced labor accusations. The move comes just a week after the Chinese government retaliated against allegations of human rights abuses in the region and related “discriminatory measures” from U.S. companies.
The Department of Homeland Security announced Wednesday that it will place Chinese steel makers and artificial sweetener manufacturers on the Uyghur Forced Labor Prevention Act (UFLPA) Entity List.
The list currently includes 75 companies that are manufactured in whole or in part in China’s Xinjiang region, based on the assumption that forced labor from China’s Uyghurs and other ethnic minorities was used in their production. Import is prohibited.
“Today’s action reaffirms our commitment to eliminating forced labor from America’s supply chains and upholding our values of human rights for all people,” Department of Homeland Security Under Secretary for Policy Robert Silvers said in a statement. It is a thing,” he said.
These companies are the first in their respective industries to be added to the list. Many of the previous companies added were involved in Xinjiang’s large cotton and textile industry.
“No area is off-limits, and we will continue to identify organizations across our industry and hold accountable those who profit from exploitation and abuse,” Silvers said.
UFLPA cited growing evidence that the Chinese government has been detaining and exploiting Muslim-majority Uyghurs and other ethnic and religious minorities in the Xinjiang region for years. It was established in December 2021.
China has continually denied such claims. As relations between the United States and China deteriorate, the Entity List is another factor in the trade decoupling of the world’s two largest economies.
The Chinese government launched a new effort to counter the import ban last week, announcing it would investigate the U.S. company that owns fashion brands Tommy Hilfiger and Calvin Klein for alleged “discriminatory measures” against Xinjiang cotton companies. .
The group, PVH, has a presence in both the United States and China, and is one of a growing number of foreign companies seeking to distance themselves from allegations of forced labor in Xinjiang.
China’s Ministry of Commerce suspects the company is “violating normal market transaction principles and boycotting cotton and other products from Xinjiang without basing it on facts,” according to state media.
PVH must respond to the authorities within 30 days or could be added to China’s list of “untrusted organizations,” which could lead to further penalties and restrictions. The company, which has a large presence in China and the United States, told CNBC it is in contact with Chinese authorities.
“As a matter of corporate policy, PVH maintains strict compliance with all relevant laws and regulations in all countries and regions in which it operates,” the company said, adding, “We will respond in accordance with relevant regulations.”
China has previously placed U.S. companies such as defense contractors Lockheed Martin and Raytheon on its Entity List over trade and operations in Taiwan.
The European Union has approved new laws that ban products made using forced labor and require large companies to conduct human rights and environmental audits of their overseas suppliers. Taiwan is also reportedly considering its own forced labor legislation, similar to UFLPA.
—CNBC’s Evelyn Cheng contributed to this report.
