Business and Human Rights: NGOs Set Out Key Considerations for EU Import Controls to Tackle Forced Labour

There is an undisputed trend of increased and strengthened human rights and environmental due diligence laws (for example, see our previous Blogs here and here).  A related trend is the rise of import controls to supplement such measures.  For example, the United States’ Customs and Border Protection agency have in recent times increasingly issued Withhold Release Orders to detain shipments of products suspected to be produced, in whole or in part, using forced labour (for example, see our Legal Updates here and here).

The European Commission is now assessing the adoption of action and enforcement instruments to tackle forced labour. Its consideration of such mechanisms coincides with the forthcoming legislative proposals from the European Commission on Sustainable Corporate Governance (SCG), a key element of which includes an obligation for corporations to undertake human rights and environmental due diligence (HREDD).

A coalition of NGOs, including Anti-Slavery International and the European Coalition for Corporate Justice, have released an NGO position paper raising some key considerations in the development of potential import control measures in tandem with a mandatory corporate HREDD obligation.

The NGOs raise the following considerations in their position paper:

Relationship between potential EU import controls and upcoming mandatory HREDD

1. The EU must establish a separate law that requires corporations to undertake HREDD and provide remedies to victims of corporate abuse.
2. The SCG directive must contain both administrative enforcement by authorities and judicial enforcement by virtue of injunctive, compensatory and/or restorative claims by (potential) victims and representative stakeholders.
3. EU import controls on products made or transported with forced labour would be a powerful supplementary instrument to enforce forthcoming HREDD laws.
4. For EU import controls to remain effective, the SCG directive must require corporations to disclose their subsidiaries, business partners and suppliers to ensure that stakeholders and public officials can externally monitor their operations, and ultimately, hold them accountable.

Scope of import controls

5. In order to better align the functioning of any future import controls regime with the forthcoming HREDD obligation, the European Commission should actively explore extending import controls on products made in violation of other types of human rights or environmental harm.

Elements of a forced labour import controls instrument

6. Stakeholders should have the right, through a formalised and secure procedure and on a confidential or anonymous basis, to make complaints to relevant authorities without fear of reprisal, concerning products made or transported in whole or in part, with forced labour. An investigation must then be carried out by the relevant authorities and response provided to the complainant within a reasonable time frame.
7. During the investigation, the relevant authorities must consult relevant stakeholders and invite them to provide any evidence prior to the imposition of any import controls as part of a human rights impact assessment in order to determine potential consequences.
8. The easing of import controls should be made strictly contingent on the remediation of harmed rights-holders as well as on measures taken to guarantee non-repetition and the prevention of new harm.
9. Monitoring of remediation/corrective actions should be undertaken in cooperation with relevant civil society stakeholders, including trade unions.
10. A public list of sanctioned entities, regions and products should be created and maintained.

The paper notes that it is crucial to ensure improved public access to customs data in order to facilitate the identification and monitoring of the importation of products made in whole or in part by, or transported with, forced labour.  It follows that the European Commission and Member States must amend the Union Customs Code to clarify that customs data is not confidential and can be disclosed publicly.  The paper also notes that, in other jurisdictions, such as the United States, customs data is subject to Freedom of Information requests.

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Best-in-class companies are applying the below strategies to continually improve their human rights and environmental risk management:

1. Integrating human rights into group policies and strategic planning processes;
2. Disclosing how human rights considerations are integrated into strategies, policies and procedures;
3. Carrying out a human rights impact assessment and taking proportionate counter-measures, as well as communicating internally and externally on what measures have been taken;
4. Reviewing and reinforcing complaints mechanisms and speak-up programs;
5. Ensuring the business is well equipped to deal with ‘crises’;
6. Reviewing the extent to which their board is equipped to address supply chain risks; and
7. Reviewing the role, resources and expertise of the legal and compliance functions, who should play a key part in addressing these new challenges.

Read more of our Business and Human Rights perspectives.

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