How the Uyghur Forced Labor Prevention Act Impacts Retail

U.S. retailers now face a heightened antislavery risk at the border. Picture a routine day at a busy port. An inspector opens a box of imported snacks and notices a small logo. The shipment stops immediately. U.S. Customs and Border Protection detains the goods and flags related shipments at other ports. Inside the company, teams scramble to trace ingredients, storage fees accumulate, shipping costs rise, and sales stall. This scenario doesn't involve a paperwork mistake. It reflects a suspicion that the goods connect to forced labor.

The Legal Framework

The Uyghur Forced Labor Prevention Act (UFLPA), enacted in 2021, is a statute every retail executive should understand. Unlike the U.K. Modern Slavery Act or the California Transparency in Supply Chains Act, the UFLPA doesn't focus on disclosure or public reporting. It governs market access. In practical terms, it determines whether goods may enter the U.S. at all. Within its first year of enforcement, CBP detained more than $1 billion in merchandise. The message is clear: Retailers must know, and must be able to demonstrate, exactly how their products are made.

Under the UFLPA, any goods with a nexus to China’s Xinjiang Uyghur Autonomous Region or to companies listed on the UFLPA Entity List are presumed to have been made with forced labor. Once CBP identifies a credible connection, the legal burden shifts entirely to the importer. The shipment remains detained unless and until the importer can affirmatively prove otherwise.

This framework leaves little room for argument. Importers cannot rely on good intentions, contractual assurances, or lack of visibility into upstream factory operations. Following a detention notice, importers typically have a short window, generally 30 days under current CBP practice, to submit “clear and convincing” evidence. That evidence must trace the supply chain in full, often down to the raw material level, and demonstrate that no forced labor occurred at any stage of production.

The stakes extend beyond the detained shipment. CBP may pursue civil penalties and refer matters for further investigation. Oversight doesn't stop at the border. U.S. Department of Homeland Security, through the interagency Forced Labor Enforcement Task Force, maintains and updates the UFLPA Entity List, expanding enforcement reach across industries and geographies. Even where penalties do not materialize, prolonged detentions and supply disruptions often draw attention from customers, investors, and business partners who begin to question how operational failures align with a company’s stated ethical commitments.

Retail supply chains remain particularly exposed. Short response deadlines collide with complex and opaque networks of manufacturers, sub-assemblers, and raw materials suppliers across sectors such as electronics, apparel, footwear, pharmaceuticals, agriculture, industrial goods, and automotive products. In this environment, reactive compliance proves costly and uncertain. Retailers benefit most from a proactive compliance plan that maps supply chains, documents sourcing, and prepares evidentiary packages before a shipment ever reaches the port.

A Practical Compliance Framework for Retailers

Compliance requires more than checking a box. It starts with prioritization and a disciplined framework:

• Map supply chains beyond the first tier and screen suppliers for forced labor risk.
• Maintain complete, traceable production records at each stage of manufacturing.
• Draft contracts that mandate full supply chain visibility and prohibit forced labor.
• Train internal teams on UFLPA requirements, detention triggers, and red flags.
• Engage external support, including laboratories, compliance vendors, and counsel.

This approach takes effort, but it proves far easier than responding to regulatory action or defending ethical commitments to customers and investors.

Allison Raley is a partner at law firm Arnall Golden Gregory LLP, leader of its Global Trade & Sanctions team, and co-chair of its Emerging Technologies industry team and Women in Tech Law group. 

Nikita Kulkarni, an associate at Arnall Golden Gregory LLP, advises corporate and institutional clients on complex business disputes, government investigations, and securities litigation.