House China committee targets top clothing brands

A House committee examining the economic relationship between the US government and China has asked some of the world’s largest apparel companies for information about the use of forced labor during production – a potential violation of US trade law.

The lawmakers asked retailers Temu and Shein Nike And Adidas North America regarding the use of materials and labor from China’s Xinjiang Uyghur Autonomous Region, according to letters sent to company leaders on Tuesday. Such practices would constitute violations for the year 2021 The Uyghur Forced Labor Prohibition Actaccording to lawmakers.

Congress passed the UFLPA with bipartisan support after the State Department determined that China was “committing genocide against the Uighurs and other minority groups in Xinjiang”.

The letters were sent to Robert Campbell, President of Adidas North America; Timo’s chief, Kin Soon. Chris Shaw, CEO of Shein and John Donahoe, President and CEO of Nike, Inc. It was signed by Representatives Mike Gallagher, R-Wisk, chairman of the CPC House Select Committee, and Ranking Member Raja Krishnamurthy, D-Ill.

“The use of forced labor has been illegal for nearly a hundred years – but despite knowing their industries are involved, many companies go the other way hoping they won’t get caught, rather than cleaning up their supply chains. This is unacceptable,” Gallagher in a statement. “US companies and businesses that sell to the US market have a moral and legal obligation to ensure that they do not engage themselves, their customers, or their shareholders in forced labor.”

The inquiries also come on the heels of a committee hearing in March that included a report assessing experts that US companies were funding “state-sponsored forced labor programs in the Uyghur region.”

Lawmakers requested responses to their questions, including the identity of material suppliers, supply chain policies and vetting measures for suppliers, by May 16.

Representatives for the companies did not immediately respond to requests for comment from CNBC.

The latest inquiries follow a separate, bipartisan effort earlier this week urging the Securities and Exchange Commission to require Shein to certify that it does not use Uyghur labor before the company can expand into the US market. Shein denied the accusation.

Chinese brands Shein and Temu, owned by Chinese parent company PDD Holdings, are also accused of taking advantage of a 90-year-old loophole to avoid tariffs on several goods sold directly to American consumers, lawmakers said Tuesday.

Lawmakers say Shein and Temu rely heavily on the minimum requirement of Section 321 of the Tariff Act of 1930 to waive import duties if the fair retail value in the shipping country does not exceed $800.