You can’t sell your merchandise if it’s held up at Customs.
Notoriously complex and opaque global supply chains have made the fashion industry especially vulnerable to shipment detentions from U.S. Customs and Border Protection. In fact, fashion is second only to the electronics in terms of CBP examinations, so an ounce of prevention is worth a pound of cure. Not knowing exactly what’s in your textiles or apparel—from where the raw materials were sourced to what type of labor was or wasn’t used along the supply chain—is a costly gamble amid CBP crackdowns over forced labor regulations like the Uyghur Forced Labor Prevention Act (UFLPA).
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As explained in the recent Sourcing Journal webinar The True Cost of Detention: Mitigating CBP Seizures with Supply Chain Visibility, costs start incurring as soon as goods are detained under suspicion of forced labor or other violations, including legal fees, container fees and demurrage fees as importers scramble to produce reams of documents from numerous global suppliers along the supply chain. In addition, garments detained over suspicion of non-compliance might mean missing a crucial fashion selling season. With approximately $468 billion dollars of garment imports in the G20 at risk of modern slavery according to Fashion Revolution’s 2023 Fashion Transparency Index, it pays to be vigilant.
And while UFLPA gets most of the attention, it’s not just UFLPA that can hold up goods. The Tariff Act of 1930 gives CBP authority to detain, further examine or seize goods that violate laws ranging from country of origin to intellectual property rights. Willful ignorance won’t get seized shipments out of CBP detention, nor will it prevent future Withhold Release Orders (WROs). The key is to know what’s in your supply chain before it’s too late.
Under UFLPA, for example, companies are given 30 days to submit a “rebuttal presumption” admissibility package demonstrating that the detained goods are not produced with forced labor or not connected to the Xinjiang region of China.
“It’s really important to note that 30 days is not a lot of time, especially if you haven’t already started collecting your supply chain data,” said Ana Hinojosa, former CBP executive director and Oritain advisor, in the webinar, moderated by SJ editor-in-chief Peter Sadera. “It’s virtually impossible to pull up an admissibility package if you haven’t already started doing your homework and collecting and getting transparency into your supply chain. It’s really important to start that process ahead of time.”