Companies, business groups lobby against forced labor act
— Nike and Coca-Cola are among the major companies and business groups lobbying Congress to weaken a bill that would ban imported goods made with forced labor in China’s Xinjiang region, according to congressional staff members and other people familiar with the matter.
The bill, which would prohibit broad categories of certain goods made by persecuted Muslim minorities in an effort to crack down on human rights abuses, has gained bipartisan support, passing the House in September by a margin of 406-3. Congressional aides say it has the backing to pass the Senate and could be signed into law by either the Trump administration or the incoming Biden administration.
But the legislation, called the Uyghur Forced Labor Prevention Act, has become the target of multinational companies including Apple, whose supply chains touch the far western Xinjiang region, as well as of business groups including the U.S. Chamber of Commerce.
Lobbyists have fought to water down some of its provisions, arguing that while they strongly condemn forced labor and current atrocities in Xinjiang, the act’s ambitious requirements could wreak havoc on supply chains that are deeply embedded in China.
Xinjiang produces vast amounts of raw materials like cotton, coal, sugar, tomatoes and polysilicon, and supplies workers for China’s apparel and footwear factories. Human rights groups and news reports have linked many multinational companies to suppliers there, including tying Coca-Cola to sugar sourced from Xinjiang, and documenting Uyghur workers in a factory in Qingdao that makes Nike shoes.
In a report issued in March, the CongressionalExecutive Commission on China, a bipartisan group of lawmakers, listed Nike and Coca-Cola as companies suspected of ties to forced labor in Xinjiang, alongside Adidas, Calvin Klein, Campbell Soup Co., Costco, H&M, Patagonia, Tommy Hilfiger and others.
In a statement, CocaCola said it “strictly prohibits any type of forced labor in our supply chain” and uses third-party auditors to closely monitor its suppliers. It also said that the COFCO Tunhe facility in Xinjiang, which supplies sugar to a local bottling facility and had been linked to allegations of forced labor by The Wall Street Journal and Chinese-language news media, “successfully completed an audit in 2019.”
Greg Rossiter, the director of global communications at Nike, said the company “did not lobby against” the Uyghur Forced Labor Prevention Act but instead had “constructive discussions” with congressional staff aides aimed at eliminating forced labor and protecting human rights.
Asked about the allegations of forced labor, Nike referred to a statement in March in which it said that it did not source products from Xinjiang and that it had confirmed that its suppliers were not using textiles or yarn from the region.
Nike said that the Qingdao factory had stopped hiring new workers from Xinjiang in 2019, and that an independent audit confirmed there were no longer employees from there at the facility.