Recent statistics from the International Labour Organisation show that the number of victims of forced labour has been on the rise since 2016, amounting to nearly 28 million people worldwide. They are usually the most vulnerable: migrant workers whose documents have been confiscated and are forced to work long hours in unsafe conditions with little to no pay, often producing goods aimed at Europe.
It is high time for the European Union, as one of the largest trading blocs in the world, to stand among the United States and other global partners in taking firm action against forced labour.
In the US, the Tariff Act of 1930 prohibits the import of goods manufactured wholly or partly by forced labour. However, the rule only began to have teeth in 2015, when Congress closed a major loophole in the law. This has allowed the US Customs Border Protection (CBP) to initiate investigations and seize and detain imports suspected to be tainted with forced labour.
It is high time for the European Union ... to stand among the United States and other global partners in taking firm action against forced labour.
The US example is encouraging. Working together with civil society activists, trade unions and the media, the CBP has been able to gather information on forced labour in global supply chains and block goods made by forced labour from entering the US. Given the importance of the US market, this has pushed many manufacturers to reform their operations.
For example, in 2019, the CBP banned the import of disposable rubber gloves manufactured by WRP Asia Pacific in Malaysia due to the company’s treatment of migrant workers. The workers were forced to pay exorbitant recruitment fees – a far too common practice that often leads to debt bondage and forced labour. A year later, under pressure, the company started a remediation programme aimed at repaying the recruitment fees demanded from the workers.
In her State of the European Union address last year, European Commission President Ursula von der Leyen declared that her Commission would publish a proposal on banning goods made by forced labour from the EU market. This long-awaited proposal was finally tabled in mid-September, just one day before President von der Leyen was due to give her next SOTEU speech.
The regulation proposed by the Commission has the necessary elements to be an important tool for companies – alongside the EU corporate sustainability due diligence obligations – in cleaning European supply chains of human rights abuses. These two tools complement each other in crucial ways.
On the one hand, the corporate sustainability due diligence directive translates the 2011 UN Guiding Principles on Business and Human Rights into law. The obligations aim to level the playing field for companies, obliging them to trace their supply chains and identify risks for negative human rights and environmental impacts in order to prevent and mitigate them.
On the other hand, the forced labour product ban will set up a mechanism whereby products tainted with forced labour will be withdrawn from the markets. This product-based ban applies to all entities placing products on the market. And it applies to forced labour whether it takes place in supply chains inside the EU or in third countries.
The Commission’s proposal is encouraging and a definitive step in the right direction. However, it contains some key weaknesses that the European Parliament needs to address.
First, the system proposed by the Commission is retroactive and aims at withdrawing goods from the market rather than stopping them at the border as in the US. In other words, the proposed system will not stop goods made by forced labour from flowing into the EU, but it will catch some after they have entered the internal market. In its current form, the proposal lacks the powers that the US authorities have to hold shipments until it is proven that they are not linked to forced labour.
[T]he proposed system will not stop goods made by forced labour from flowing into the EU, but it will catch some after they have entered the internal market.
Secondly, the proposal does not include provisions for victims of forced labour. In its June 2022 resolution, the European Parliament called for the new instrument to require responsible companies to provide remediation to the affected workers prior to import restrictions being lifted, and the monitoring of these corrective actions in cooperation with civil society and trade unions.
Finally, the burden of proof in cases of forced labour lies with Member States’ authorities, and the bar is set worryingly high. Companies do not need to prove anything unless someone raises an issue. By the time under-resourced authorities find conclusive proof of forced labour, the product could already be on the market and sold to people.
It is now up to the European Parliament to strengthen the proposal so that we can be certain that no products tainted with forced labour enter the EU market. The ban will be a crucial tool, together with the corporate sustainability due diligence legislation, to strengthen corporate accountability and uphold human rights in global value chains.