A shopper holds a bag of Nike merchandise in the Magnificent Mile shopping district on December 21, 2022 in Chicago, Illinois.
Scott Olson | Getty Images
WASHINGTON — A House committee examining the U.S. government’s economic relationship with China is demanding information from some of the world’s largest apparel companies about the use of forced labor in their production processes — a possible violation of U.S. trade law.
Lawmakers ask retailers Temu, Shein, nike and adidas North America’s use of materials and labor from China’s Xinjiang Uyghur Autonomous Region, according to a letter sent to company leaders on Tuesday. This approach will constitute a 2021 Uyghur Forced Labor Prevention Actaccording to lawmakers.
Congress passed UFLPA with bipartisan support after the State Department determined that China was “perpetrating genocide against Uyghurs and other ethnic minorities 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. They were signed by Rep. Mike Gallagher, R-Wisc., chairman of the House Select Committee on China, and Raja Krishnamoorthi, ranking member, Dill.
“The use of forced labor has been illegal for nearly a hundred years – yet too many companies hope they won’t get caught rather than clean up their supply chains despite knowing their industry is being implicated. This is unacceptable Accepted,” Gallagher said in a statement. “U.S. businesses and companies selling products in the U.S. market have a moral and legal obligation to ensure that they do not involve themselves, their customers, or their shareholders in slave labor.”
The investigation also comes on the heels of the committee’s March hearings, which included an expert assessment that found U.S. companies funded “state-sponsored forced labor programs in the Uyghur region.”
Lawmakers have until May 16 to have their questions answered, including the identities of material suppliers, supply chain policies and supplier auditing measures.
Representatives for the companies did not immediately respond to CNBC’s request for comment.
The latest probe follows another bipartisan effort earlier this week urging the SEC to require Shein to certify that it does not use Uighur labor before the company can expand into the U.S. market. Shein has denied the allegation.
Chinese brands Shein and Temu, owned by Chinese parent company PDD Holdings, have also been accused of exploiting a 90-year-old loophole to avoid tariffs on many goods sold directly to U.S. consumers, lawmakers said Tuesday.
Lawmakers said Shein and Temu relied heavily on the de minimis provision of Section 321 of the Tariff Act of 1930, which exempts import duties if the fair retail value in the country of shipment does not exceed $800.