Supply chain heads should be aware that that use of forced labour is not limited to China, but has become globally pervasive, according to the providers of an AI-tool risk assessment solution.
Under new rules coming from Europe and North America, importers will be presumed guilty of using forced labour in supply chains unless they can prove otherwise.
Under the US Uyghur Forced Labor Prevention Act, importers essentially operate under this rebuttable presumption. Tony Crisafulli, chief revenue officer of customs broker Alba Wheels Up, said: “It’s essentially a law of ‘guilty until proven innocent’.”
The notion of “rebuttable presumption” importers have to prove they’re not guilty, although they don’t have to prove 100% no forced labour; “very low probability” is sufficient – it essentially means importers need to have some form of forced labour monitoring system in their supply chains.
Mr Crisafulli said this would put a strain on importers, as, if a shipment was detained in port, they need to be able to prove to customs officials that it had not leveraged forced labour.
Traditional methods of achieving this could require weeks, if not months, of manual work and documents numbering into the thousands, he explained, all the while shipments are detained in port accruing “tens of thousands of dollars in detention and demurrage charges, not to mention the hit to empty shelves and lost sales and to the brand”.
Consequently, Mr Crisafulli said, it was imperative importers looked to digitise the processes of monitoring flows, and suppliers must stay within the law.
Customs agencies in the US and Europe are enhancing their detection activities. And Alba EVP Vince Iacopella said: “The US Customs website states that there is an accelerated release programme for those providing a summary tracing report, which includes using AI tools, to prove compliance.”
He added that, while supporting the law, he could see the point of view of the importers and the extra burden on them. But added he wasn’t alone in suggesting the forced labour focus on China was myopic.
“There certainly needs to be a focus on China, but the issue is far more widespread. Child labour has recently found to be deployed in many countries, from Egypt’s jasmine picking industry – an essential ingredient in perfumes – to fruit picking in Latin America and beyond.
“And, perhaps what’s most important to stress, is that China is not top of the list when it comes to forced labour, it is pervasive across South Asia.”