Shein, Temu and the $800 Sin: Stopping Uyghur Forced Labor Cotton by Unstitching the U.S. Border Free-for-All ( dominotheory.com )

Nineteen percent of cotton on the U.S. market still sources back to the forced labor heartlands of East Turkestan (Xinjiang), according to a new analysis. Reducing that figure is easier than Washington makes it look.--

Tests in all fields of science have reproducibility issues. Researchers publish findings one day only to obtain different results the next. Thus, when mutually independent investigations reach the same conclusions, it indicates more than a hint of truth.

That in mind, the results of a recent analysis by biotechnology firm Applied DNA Services into the origin of cotton sold on the U.S. market make interesting reading. Sampling 822 cotton-containing products from clothing to home textiles, the company found almost one-fifth contain the isotopic signature of China-controlled East Turkestan (Xinjiang), where various evidence and reports indicate it may have been picked or processed by innocent detainees and others whose personal autonomy has been entirely negated by the Chinese Communist Party. Smaller-scale testing by the U.S. Customs and Border Protection reached similar conclusions last year.

So, tainted materials are continuing to infiltrate the supply chains for American consumers, and, given that Washington has passed the Uyghur Forced Labor Prevention Act, which prohibits the importation of goods produced wholly or in part from the so-called Xinjiang Autonomous Uyghur Region unless it can be proven that they are not the fruits of coerced labor, this raises three important questions: How is so much contraband cotton escaping the attention of U.S. officials? Who is bringing it in? And what needs to be done to prevent it?

The first is not difficult to answer. Some of the cotton is tucked away in blended fibers and mislabeled as wholly U.S.- or Brazil-produced to obscure its true origin, while, as revealed to Sourcing Journal by Applied DNA Services’ Vice President MeiLin Wan, a quarter is entering the United States by taking advantage of a legal exemption known as “de minimis” at the border. Originating from the 1930 Tariff Act, this loophole currently allows packages valued at less than $800 to be imported without paying duties, which, in practical terms, means less attention from authorities and an open invitation for products that would prefer less scrutiny of their background.

As for who is responsible for dressing the U.S. in tearstained garments, unlike research from Germany that willingly pointed the finger at big brands like Adidas, Puma and Hugo Boss in 2022, Applied DNA Services has declined to name names, but its revelation about the de minimis pathway implicates China’s fast fashion giants. Both Temu and Shein have been linked to potential forced Uyghur labor before, and both have a business model that is predicated on keeping prices down by importing packages under the $800 threshold. Each ships more than a million a day.

Supporters of de minimis argue it is a boon to small businesses, but their line hardly holds when it is giving a tax-free ride to companies with estimated annual revenues that can top $30 billion, especially since it also facilitates factories and firms with functionally absent human rights safeguards to outcompete the American domestic retail and textile industries. That China’s other de facto export to the States — fentanyl — is also creeping in via the same exception to law does not strengthen their case.

Nor does the statistic that 85% of U.S. cargo seizures arrive to the country’s airports and shores in de minimis form. This was revealed by Brandon Lord, executive director at the U.S. Customs and Border Protection’s Trade and Policy Programs department, who, in testimony to the House of Representatives Committee on the Judiciary Subcommittee on Courts, Intellectual Property, and the Internet in early May, asserted that the exemption has created an environment with “high rates of non-compliance” that expends government resources instead of saving them as intended.

To ensure, then, that U.S. citizens can towel off, clothe themselves and clad their feet in the morning without literal blood being shed from nonvoluntary workers to enable them to do so, revoking or radically reforming the low-cost package free-for-all seems to be a vital next step. Doing so would lessen pressure on Customs and Border Protection staff, who, in the ecommerce era, are now attempting to field more than a billion de minimis imports per year without corresponding increases in tools and personnel, according to Lord.

If taking a hatchet to de minimis is deemed unworkable or misdirected at U.S. consumers, then far tighter screening and more severe punishments for companies whose shipments contain Xinjiang produce are the other alternative. It would also help to prevent re-export of goods that have been denied entry on forced labor grounds so that suppliers cannot try their luck in America before pivoting to markets with weaker legislation if they get found out. Such measures would compel businesses to apply a significantly more watchful eye to where and how their goods come to be.

Having already denied items to the value of over $3.3 billion, including more than 1,400 apparel, footwear and textile shipments, from entry to its markets on the grounds that Uyghurs and other Turkic peoples may have suffered unconscionable mistreatment to produce them, the U.S. has taken a leading role to send the message that modern slavery will not be tolerated.

Nonetheless, when it comes to combating vast human rights abuses in East Turkestan, even the best have plenty of room for improvement. In contrast to the concept of negligibility that underpins de minimis, nothing less than maximum effort is required.