President Obama signed last week the Trade Facilitation and Trade Enforcement Act of 2015, making it illegal for the U.S. to accept imported products made by forced labor.
The law amends previous legislation that allowed any product into the country regardless of how it was produced if it met the “consumptive demand” rule, which is when demand is high but supply is insufficient. The Tariff Act of 1930 allowed the Customs and Border Protection Agency to seize imports of goods suspected to be produced by forced labor. However, according to the Associated Press, the agency last used that authority just 39 times due to consumptive demand. Section 910 of the new trade act closes that loophole.
The U.S. Department of Labor has a list of goods imported from around the world it has reason to believe are produced through child or forced labor. Cotton from Argentina, silver from Bolivia and Christmas decorations from China are a few of the items on that list. The Trade Facilitation and Trade Enforcement Act also targets strengthening broader trade remedy laws and tackles specific issues like anti-dumping. At the bill signing on Feb. 24, President Obama said the new law will force other countries to abide by the stricter trade rules.
“We can’t have other countries cheating,” Obama said. “We can’t have other countries engaged in practices that disadvantage American workers and American businesses.”
The trade act has received widespread support from companies, trade associations and other organizations as it moved through Congress and the Senate in recent months. Thomas J. Gibson, president and CEO of the American Iron and Steel Institute, said the law gives the U.S. manufacturing industry “new tools to fight back against unfair trade,” the group said in its statement.
The trade bill also includes provisions of the Enforcing Orders and Reducing Circumvention and Evasion (ENFORCE) Act, which Gibson and the steel industry applauded as well.
“The ENFORCE Act will finally address the growing and injurious practice engaged in by foreign competitors who try to dodge U.S. laws – often by shipping the product through a third country and/or misclassifying the true origin of imports coming in,” Gibson said. “This law will now provide the U.S. government the ability to investigate these schemes and, therefore, enable the steel industry to seek remedies and help preserve American jobs that have been lost due to these and other unfair practices.”
The American Shrimp Processors Association also voiced its support for the bill in early February after Congress passed it, calling the legislation a “major step forward” in ensuring U.S. companies are protected from unfair trade practices. The global shrimp supply chain faced scrutiny recently after the AP found it contained child and forced labor. Shrimp peeled by these workers in Thailand were ending up on the shelves of major U.S. retailers like Wal-Mart and Whole Foods.