Last week, the Biden administration took two separate actions related to forced labor in commercial fishing. The first action was by U.S. Customs and Border Patrol (CBP), and directly targeted Chinese practices with an import ban on certain products tied to a particular Chinese company. The second action was by the U.S. Trade Representative's Office (USTR), which raised the issue of forced labor in the context of WTO talks of fisheries subsidies. These two actions illustrate the importance that the Biden administration is putting on labor rights in general, and forced labor in particular, with China being one of the bigger targets in the effort.
The direct targeting of China took place on May 28, when the Department of of Homeland Security announced that U.S. CBP had issued a Withhold Release Order (WRO) against the Chinese company Dalian Ocean Fishing Co., Ltd. "based on information that reasonably indicates the use of forced labor in the entity’s fishing operations." (A WRO bars entry of certain goods made by forced labor. See this report by the Congressional Research Service for more). The announcement explains the findings as follows:
CBP identified all 11 of the International Labour Organization’s indicators of forced labor during its investigation including physical violence, withholding of wages, and abusive working and living conditions. Effective immediately, the new Withhold Release Order instructs CBP personnel at all U.S. ports of entry to begin detaining tuna, swordfish, and other seafood harvested by vessels owned or operated by the Dalian Ocean Fishing Co., Ltd. This is the first Withhold Release Order CBP has issued against an entire fleet of fishing vessels.
As further support for taking action here, the announcement also describes the problem of forced labor in this industry more generally:
The distant water fishing industry is at high risk of forced labor as foreign companies often coerce vulnerable migrant workers to perform hazardous labor for little or no pay aboard distant water fishing vessels that may spend months at sea without making port calls.
Forced labor in the distant water fishing industry is often linked to other fisheries abuses. Illegal, unreported, and unregulated fishing threatens the livelihoods of law-abiding American seafood producers and damages ocean ecosystems.
A State Department press release on this issue ties the actions to a 2020 Human Rights Report which documented forced-labor practice among Chinese companies:
Reports of the use of forced labor by PRC fishing vessels were described in the Department’s 2020 Human Rights Report. The report noted other PRC firms that abuse migrant workers subjected to forced labor. These workers are forced to work 18 to 22 hours a day, often in illegal, unreported, and unregulated fishing. They are prevented from leaving their ships while facing hunger, restricted communication, inadequate medical care, degrading living and working conditions, physical abuse, and debt-based coercion. The Department of Labor similarly has reported on widespread use of forced labor in the PRC’s distant-water fishing fleet.
The Biden administration's action was praised by some Democratic lawmakers, with House Trade Subcommittee Chairman Earl Blumenauer (D-OR) releasing a statement applauding the decision:
The Biden administration’s action represents an important step forward on forced labor enforcement – the previous administration had only been willing to take action against individual vessels, even though it is widely recognized that when forced labor occurs it’s often pervasive throughout entire fishing fleets. In this case, CBP’s actions come after several reports indicated that crew members aboard the fishing company have died due to harsh working conditions.
Not surprisingly, the WRO was not well received by the Chinese government. At its regular press conference on May 31, the Chinese Ministry of Foreign Affairs rejected the CBP’s findings about forced labor when responding to a question from Bloomberg, as follows:
To our knowledge, the US Customs and Border Protection's claim of "forced labor, abuse of crew members and withholding of pay" is fabrication that is totally inconsistent with facts.
Dalian Ocean Fishing Company Limited has never sold any products to the US, and there's nothing to detain in the first place.
This assertion conflicts with CBP Acting Commissioner Troy Miller’s statement at a press conference on May 28 to the effect that last year Dalian made two entries of seafood into the United States with a value of about $233,000, and had delivered $21.6 million worth of goods previously. The press conference was hosted by the Department of Homeland Security (DHS) and CBP, at which both Miller and DHS Secretary Alejandro Mayorkas spoke about the WRO. The transcript of the press conference is attached at the end of this post.
While this WRO is very clearly targeted at China, other Biden administration actions on labor issues target China more indirectly. Two days earlier, on May 26, USTR put forward a proposal in the WTO fisheries subsidies negotiations that raised the issue of forced labor. USTR explained the issue as follows:
The U.S. proposal ... calls for WTO Members’ explicit recognition of the forced labor problem and the need to address it, and proposes additional transparency with respect to those vessels or operators that use forced labor. For several years, WTO Members have been engaged in multilateral negotiations to prohibit harmful fisheries subsidies, including subsidies that contribute to overcapacity and overfishing and subsidies to vessels engaged in IUU fishing. The United States has played a leadership role in seeking a meaningful outcome, both in effective disciplines on harmful subsidies to protect our oceans and fisheries resources, and supporting our fishers and workers.
In its proposal, USTR ties forced labor to the subsidies often provided to illegal, unreported and unregulated fishing, which the WTO negotiations aim to address through new disciplines. In this regard, USTR states:
Members are currently negotiating disciplines on harmful fisheries subsidies, including with respect to illegal, unreported, and unregulated (IUU) fishing, certain distant water fishing, and fishing by vessels not flying the subsidizing Member’s flag. The use of forced labor has often been associated with these types of fishing. Disciplines to prohibit these harmful subsidies can therefore contribute to Members’ efforts to address the use of forced labor on fishing vessels, provided they are effective and not subject to unnecessary carveouts or exemptions. These disciplines should therefore be included in any outcome.
China was not specifically mentioned in the USTR proposal, but the CBP action against Dalian makes clear the U.S. concerns with the practices of Chinese companies in the fishing industry. It remains to be seen how China and other countries will respond to the USTR proposal.
Partial Transcript from DHS/CBP May 28 press conference
Secretary Mayorkas
Thank you so much, and good morning, and thanks to everyone for joining the call today. We’re going to be discussing an important update on our efforts to eliminate goods produced with forced labor from entering the United States as part of our commitment to ending trafficking and persons.
By way of background, Section 307 of the Tariff Act of 1930 prohibits the importation of goods, mined, manufactured, or produced wholly or in part by forced labor. This week, US Customs & Border Protection used its authorities under the Tariff Act to issue a withhold release order on seafood harvested by vessels owned or operated by the Dalian Ocean Fishing, a Chinese company. This is the first time CBP has used its withhold release order authority on an entire fleet of vessels, as opposed to a single ship. The fleet includes 32 vessels.
CBP issued the withhold release order based on information reasonably indicating that the Dalian fleet uses forced labor to harvest tuna, swordfish, and other seafood. This withhold release order instructs CBP personnel at all US ports of entry to detain shipments containing seafood harvested by Dalian vessels.
Today’s enforcement action reaffirms that the Department of Homeland Security will not tolerate goods made by forced labor being sold in US supply chains. These withhold release orders have been an effective tool in preventing goods made by forced labor from entering the United States, where they could hurt American consumers, businesses, and our economy.
I also want to be very clear about the human and economic cost of forced labor. Forced labor is a form of modern day slavery, characterized by horrific human rights abuses. Those abuses include activities we commonly associate with slavery, such as physical and sexual violence and withholding of wages, but they also include other means of exploiting workers. These abuses violate international labor laws and universal human rights. Victims of forced labor come from all walks of life, and our targeted across a number of industries, both domestically and internationally.
Criminal enterprises exploit workers through forced labor for one reason, profit. The International Labor Organization estimates that forced labor generates up to $150 billion in illicit profits every year.
The distant water fishing industry is at high risk of forced labor, as foreign companies often force vulnerable migrant workers to perform hazardous labor. They do so for little or no pay, aboard distant water fishing vessels that may spend months at sea without making port calls.
During fiscal year 2021, CBP has so far issued five withhold release orders, and has detained approximately 550 shipments containing more than $71.5 million worth of goods suspected to be made by forced labor. These goods, ranging from palm oil and hair products, to apparel and computer parts, might otherwise have ended up in our food supply and in American households.
I want to take a moment, if I may, to recognize the phenomenal measures that CBP’s public servants have taken to enhance the agency’s forced labor enforcement capabilities. CBP has developed a civil investigative program for forced labor that is truly world class. And we are very grateful to receive additional appropriations from Congress this fiscal year to help ensure that we can properly execute our forced labor enforcement mission.
Through the DHS Blue Campaign, our department also leads a nationwide effort to educate the public, law enforcement, and other industry partners to recognize and report indicators of human trafficking. DHS will continue to aggressively investigate the use of forced labor by distant water fishing vessels, and by a wide range of other industries. Producers and US importers alike should understand that there will be consequences for entities that attempt to exploit workers to sell goods in the United States.
I’m now very pleased to introduce the Acting Commissioner of US Customs & Border Protection, Troy Miller, who will share additional details about his agency’s investigation into the Dalian fleet.
Troy, the floor is yours.
Troy Miller
Thank you, Mr. Secretary, and thank you to our media partners for covering this important issue. As the secretary stated, CBP issued a withhold release order on seafood from the Dalian Ocean Fishing company. I have instructed CBP personnel at all US ports of entry to detain shipments containing tuna, swordfish, and other seafood harvested by Dalian’s 32-vessel fleet. The withhold release order also applies to end products, such as canned tuna and pet foods.
When conducting forced labor investigations, CBP evaluates a wide range of source material, including government reports, studies by nongovernment organizations, media reporting, and firsthand accounts. It’s important to note CBP’s forced labor investigations are based on internationally recognized labor standards, and are guided by the International Labor Organization’s 11 indicators of forced labor. CBP self-initiated the investigation into the Dalian Fleet in spring 2020. We found evidence of all 11 forced labor indicators, including physical violence against fishers, debt bondage, withholding of wages, and abusive living and working conditions.
Pursuant to the procedures governing withhold release orders, CBP personnel will detain shipments containing seafood from the Dalian fleet to ask more questions about how it was harvested. When shipments are detained, the importer of record will have three months to give proof that the seafood wasn’t harvested using forced labor, or to reexport the seafood. If they fail to do either, CBP will consider the seafood abandoned, and will seize and destroy the shipment.
The withhold release order joins a growing list of enforcement actions that CBP is taking to combat forced labor. To date, CBP enforces a total of 48 active withhold release orders, and 8 active forced labor findings. As the secretary mentioned, CBP issued five withhold release orders so far in fiscal year 2021, and detained approximately 550 shipments. These shipments contained more than $71.5 million of goods suspected to be made by forced labor. But the detention numbers don’t tell the whole story. This fiscal year, CBP targeted the total of 1,174 shipments subject to withhold release orders that contained goods worth more than $735 million. Some importers, recognizing that their merchandise may be subject to detention, chose not to file for entry when their merchandise at US ports of entry. This tells us that withhold release orders act as a deterrent to importers trying to bring in products made by forced labor.
These enforcement actions send a clear message to the trade community, know your supply chain. Under US law, importers are required to exercise reasonable care and to ensure that their supply chains are free of forced labor. The US government provides numerous resources to do this. The Department of Labor’s comply chain app; the Department of Labor’s list of goods made by child labor or forced labor; the Department of State’s trafficking and person’s report; the Department of State’s country report on human rights practices; and the July 1, 2020 Xinjiang business advisory.
Some of our media partners continue to shine a light on forced labor through all global supply chains. These efforts have produced credible, and often detailed reporting on conditions of forced labor across the globe. Companies can no longer claim ignorance as an excuse for overlooking modern slavery in their supply chains. Consumers also play an important role in ending forced labor. CBP encourages consumers to take simple steps to support the fight against forced labor. Consumers should shop directly with reputable retailers. They should learn about industries and regions that are at high risk of forced labor, and they can report violations online at eallegations.cbp.gov, or by calling 1-800-BEALERT. Use your voice to tell companies that we will not tolerate forced labor in US supply chains.
In closing, I want to thank the men and women of CBP who are working tirelessly to investigate forced labor and eliminate it from US supply chains. They are doing incredible work to ensure a level playing field for [audio drops] to protect American consumers, and to defend basic human rights.
...
The use of forced labor violates fundamental human rights and international labor laws, while introducing unfair competition into the global marketplace. CBP will not tolerate these abuses. We will continue to aggressively investigate and keep goods made by forced labor out of the US, and we continue to encourage like-minded partners to join us in this effort.
Thank you again for joining this briefing, and for your interest in CBP’s efforts to addressed forced labor. The secretary and I look forward to your questions.
[Q & A starts] ...
Demetri Sevastopulo (FT)
I’m just a little bit confused. Can you clarify, have you actually confiscated some seafood shipments from the Dalian fishing company already? And if you had, what kind of volume and value are we talking about?
And then just relatedly, are you also looking at any of the other hundreds of Chinese shipping fleets that bring this kind of project to the US?
Troy Miller
No, we are issuing the withhold release order today. We continue to look at additional fleets across the sector to determine if there is any forced labor.
Ben Fox (AP)
Can you tell us, say, like, in tons and products, how much seafood has come from this fleet in, say, the last 12 months in the United States? And are there shipments that come through third parties, or are they coming directly from Dalian? Thank you.
Troy Miller
To date, this year, we have received no importation. Last year, about $233,000 and two entries.
David Lawder (Reuters)
I’m just wondering if you can talk a bit more about the conditions that your investigation found. These are Chinese nationals that are working on these boats, or are they people from elsewhere? Is there any evidence of Uighur Muslims from Xinjiang that are being pressed into service on these boats? And in terms of the conditions, you mentioned physical violence, withholding of wages, just wondering if you can describe sort of the conditions a bit more in detail. Thanks.
Troy Miller
Thank you for the question, David. There’s no indication of Uighurs being used for forced labor with this particular company. The ships are scattered off of the coast of China, Indonesia, and Senegal. As we indicated, our investigation has found indications of physical violence against the fishers, the fishermen, debt bondage, withholding of wages, abuse of living and working conditions, and really indications of all 11 of the [indiscernible] indicators.
David Lawder
Right, and these are people from other countries, as well as China, or?
Troy Miller
Predominantly Indonesia.
David Lawder
The people that are being, their rights are being abused, are Indonesians?
Troy Miller
Yes, sir.
Geneva Sands (CNN)
To follow up on Ben’s question, I’m wondering if there haven’t been any imports into the US in the last year, what actually will be the impact on the company going forward? Do you think that they see the US market as being important to them?
Troy Miller
They did recently declare bankruptcy, but we’ve seen indications of activity again, and frankly, it does serve a message across the fishing industry that we’re not going to tolerate this type of activity.
Doug Palmer (Politico)
In recent months, there’s been concern about the use of forced labor in Chinese solar products. I wondered, can you comment whether that’s something that CBP is currently looking at, and can we expect action on that in the near future?
Troy Miller
No comments on that particular question at the moment.
Jeanne Whalen (Washington Post)
Do you know much about how the Indonesian workers ended up on these ships in the first place? Is Dalian primarily hiring workers for its fleets in Indonesia, and is it promising them different conditions than they end up experiencing on the ships? Also, are you going to provide anything in writing about your findings, just to give us any more detail about what you actually found?
Troy Miller
We will be issuing a press release. And generally, in these instances, they will recruit the individuals and promise them things that they just don’t withhold, and then they’ll undertake the things that we found, like I said, like physical violence, debt bondage, withhold of wages, and abusive living conditions.
Jeanne Whalen
Just to clarify, did you say last year there was about $233,000 worth of seafood from this company, Dalian, imported into the US?
Troy Miller
Yes, last fiscal year, about $233,000 worth.
Jeanne Whalen
That’s not very big, I take it.
Troy Miller
That’s true. Yes, that’s not a big number. I could clarify, too, going back to 2018, there’s about $21.6 million worth of imports. So, as they come on to bankruptcy and we see activity, we wanted to surely address it now.
Secretary Mayorkas
I should also note, if I may, that we will not tolerate any amount derived from forced labor.
Yuka Hayashi (Wall Street Journal)
I understand that your agency has handled several cases related to forced labor in Xinjiang. Have you done any cases related to forced labor in China, other than those cases and this one?
Troy Miller
I mean, we’ve done several. We just recently did the cotton and tomato withhold release order. I think we have 11 recent withhold release orders from the Xinjiang region in China.
Yuka Hayashi
Okay, but outside of Xinjiang, this seems like the first forced labor related case in China.
Troy Miller
Yes, one other region [background noise] Hero Vast Group, which was related to clothing.
