Solar Dominates Shipments Stopped Under UFLPA, Though Excluded at Much Lower Rate

Shipments of electronics comprised half the number and nearly 90% of the value of all shipments stopped under the Uyghur Forced Labor Prevention Act since enforcement began in the third quarter of 2022, according to data released by CBP as part of its UFLPA “Dashboard,” which debuted March 14. The bulk of those shipments were of solar products, CBP officials said at a press conference that day.

Out of 3,237 shipments stopped under UFLPA, a total of 1,627 have been shipments from CBP’s electronics industry category -- which a CBP data dictionary says covers Harmonized Tariff Schedule chapter 85 and part of chapter 84 -- as compared to 631 for apparel, footwear and textiles under chapters 50-65 and 422 from the industrial and manufacturing materials industry under chapters 25, 39-48 and 68-71.

Only 41 shipments of base metals -- including aluminum -- have been stopped, despite reports that CBP has added aluminum questions to its detention notices (see 2302020040). Likewise, only six shipments of the category covering auto parts have been detained, despite recent attention on potential Xinjiang ties (see 2212060054).

By value, the degree to which CBP is targeting electronics is even higher. After electronics, which account for about $841 million worth of stopped shipments, no other category accounts for more than $40 million worth of shipments stopped under UFLPA.

The “large majority” of the goods stopped by CBP under the electronics category were solar related, said Eric Choy, executive director of CBP’s Trade Remedy and Law Enforcement Division, during a press conference on the sidelines of the agency’s Forced Labor Technical Expo on March 14.

That’s partly because CBP had a “running start” in its forced labor enforcement on solar products, having issued a Withhold Release Order on polysilicon from Hoshine (see 2106240062) that was rolled into the UFLPA about a month later. Solar is a “high-risk area” and “we weren’t starting flat footed,” added AnnMarie Highsmith, executive assistant commissioner of CBP’s Office of Trade, during the press conference

The movement of solar production out of China after the imposition of antidumping and countervailing duties on solar cells and products means that, by far, the highest value of shipments stopped under UFLPA come from Malaysia and Vietnam -- at about $491 million and $394 million, respectively -- not China, at about $90 million. At the same time, other industries have also moved to Southeast Asia, with apparel, footwear and textiles also making up a sizable portion of goods stopped under UFLPA from Vietnam. In general, the region "is one of those areas where a lot of the manufacturing and the inputs coming out of the Xinjiang region of China are being used to manufacture for various reasons," Choy said.

Although CBP has stopped shipments in the electronics category more than any other, it has actually denied many fewer shipments of electronics as a proportion of overall shipments stopped, at least so far, according to the dashboard. CBP has denied 17 shipments of electronics and released 552 shipments, meaning of all the electronics shipments for which CBP has made a decision, it has only denied less than 3% of them. Another 1,058 shipments of electronics are still “pending,” which is over 61% of all pending shipments under all categories.

Overall, CBP has denied 424 shipments under UFLPA and released 1,090, meaning it has denied about 28% of all shipments where it has made a final decision. Not counting electronics, CBP has denied 407 shipments under UFLPA and released 538, putting the rate at which the agency denies non-electronics shipments at over 43%.