A client carries a bag of Nike merchandise along the Magnificent Mile shopping district on December 21, 2022 in Chicago, Illinois.
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WASHINGTON — A House committee examining the U.S. government’s economic relationship with China is asking among the world’s largest clothing corporations for information in regards to the use of forced labor during production — a possible violation of U.S. trade law.
Lawmakers asked retailers Temu, Shein, Nike and Adidas North America in regards to the use of materials and labor sourced from the Xinjiang Uyghur Autonomous region of China, in response to letters sent to company leaders on Tuesday. Such practices would constitute violations of the 2021 Uyghur Forced Labor Prevention Act, in response to the lawmakers.
Congress passed the UFLPA with bipartisan support after the State Department determined China is “committing genocide against Uyghurs and other minority groups in Xinjiang.”
The letters were sent to Rupert Campbell, president of Adidas North America; Qin Sun, president of Temu; Chris Xu, CEO of Shein and John Donahoe, president and CEO of Nike, Inc. They were signed by Reps. Mike Gallagher, R-Wisc., chair of the House Select Committee on the Chinese Communist Party, and Rating Member Raja Krishnamoorthi, D-Ailing.
“Using forced labor has been illegal for nearly 100 years—but despite knowing that their industries are implicated, too many corporations look the opposite way hoping they do not get caught, fairly than cleansing up their supply chains. That is unacceptable,” Gallagher in a press release. “American businesses and firms selling within the American market have an ethical and legal obligation to make sure they will not be implicating themselves, their customers, or their shareholders in slave labor.”
The inquiries also follow a March hearing of the committee that included an authority assessment finding that U.S. corporations finance “state-sponsored forced labor programs within the Uyghur region.”
The lawmakers requested responses to their questions, including the identity of materials suppliers, supply chain policies and audit measures for suppliers, by May 16.
Representatives for the businesses didn’t immediately reply to requests for comment from CNBC.
The newest inquiries follow a separate bipartisan effort earlier this week urging the Securities and Exchange Commission to require Shein to certify it doesn’t use Uyghur labor before the corporate can expand into the U.S. market. Shein has denied the accusation.
Chinese brands Shein and Temu, which is owned by Chinese parent company PDD Holdings, are also accused of capitalizing on a 90-year-old loophole to avoid tariffs on many goods sold on to U.S. consumers, the lawmakers said Tuesday.
The lawmakers say Shein and Temu rely heavily on the de minimus provision of Section 321 of the Tariff Act of 1930 to waive import tariffs if the fair retail value of within the country of shipment doesn’t exceed $800.
