human-rights 02 July 2020

US publishes guide on supply chain risk exposure to Xinjiang human rights abuses

A quartet of US government agencies (the departments of State, Commerce, Treasury and Homeland Security) have published an advisory on the human rights-related supply chain risks of doing business connected to the Xinjiang autonomous region of China.

The advisory notes that ‘the People’s Republic of China (PRC) government continues to carry out a campaign of repression in Xinjiang, targeting Uyghurs, ethnic Kazakhs, ethnic Kyrgyz, and members of other Muslim minority groups. Specific abuses include mass arbitrary detentions, severe physical and psychological abuse, forced labor and other labor abuses, oppressive surveillance used arbitrarily or unlawfully, religious persecution, political indoctrination, forced sterilization, and other infringements of the rights of members of those groups in Xinjiang.’

The 19-page document details ‘potential indicators of forced labour or abuses’ including:

  • Lack of transparency: Firms operating in Xinjiang using shell companies to hide the origin of their goods, write contracts with opaque terms, and conduct financial transactions in such a way that it is difficult to determine where the goods were produced, or by whom.
  • Social insurance programs: Companies operating in Xinjiang disclosing high revenue but having very few employees paying into the government’s social security insurance program.
  • Terminology: Any mention of internment terminology (e.g., education training centres (职业教育培训中心) or legal education centres) coupled with poverty alleviation efforts, ethnic minority graduates, or involvement in reskilling.
  • Government incentives: Companies operating in Xinjiang receiving government development assistance as part of the government’s poverty alleviation efforts or vocational training programmes; companies involved in the mutual pairing assistance programme.
  • Government recruiters: Companies operating in Xinjiang implementing non-standard hiring practices and/or hiring workers through government recruiters.
  • Factory location: Companies operating in Xinjiang located within the confines of the internment camps, near internment camps, or within the confines of or adjacent to industrial parks involved in poverty alleviation efforts. New factories built near internment camps.

It also gives guidance on how best to undertake relevant due diligence. But, it warns, ‘Third-party audits alone may not be a credible source of information for indicators of labor abuses for the following reasons:

  • Auditors have reportedly been detained, harassed, threatened, or stopped at the airport.
  • Auditors may be required to use a government translator who conveys misinformation or does not speak in workers’ first language.
  • Auditor interviews with workers cannot be relied upon given the pervasive surveillance, and evidence of workers’ fear of sharing accurate information.’