Last month, supply chain transparency software provider, Sourcemap, launched its Forced Labor Due Diligence Solution (FLDD) to help U.S. businesses meet standards mandated by the Uyghur Forced Labor Prevention Act (UFLPA), which had a June 21, 2022 enforcement deadline. According to the press release:
The UFLPA aims to prevent products from entering the United States if they were made wholly or in part in the Xinjiang Uyghur Autonomous Region (XUAR), or made from Uyghur labor elsewhere in China. When the UFLPA goes into effect, many of the world’s largest industries will be vulnerable to U.S. Customs and Border Protection (CBP) enforcement, facing risk of detentions, exclusions, seizures and civil or criminal liability if forced labor is found in any tier of their supply chains.
UFLPA’s passage was in December 2021, and Sourcemap developed the FLDD to help “companies solve the ‘chain of custody challenge’ – proving that they can trace products from raw material to US import – by assembling definitive proof of the entities within their supply chains.”
The Solution “marries Sourcemap’s supplier network discovery capabilities,” which allows companies to map their supply chains all the way down to the raw materials suppliers, by tracing and verifying the chain of custody “for every container entering a U.S. port.” Suppliers from Tier 1 to Tier N can be traced and proof of the origin of imported goods (required by U.S. law) can be presented.
Key features of the FLDD:
- Supplier Discovery: Expands on Sourcemap’s supplier discovery software with an automatic classification of suppliers through forced labor risk heat maps for enhanced due diligence.
- End-to-End Traceability: Collects all of the documentation needed to validate the chain of custody, compliance with forced labor regulations, and to root out fraud, waste or abuse that may obscure the presence of forced labor.
- Real-Time Monitoring: Collects real-time data to monitor supplier and overall supply chain risk exposure to fast-changing conditions including sanctions, affiliations, and adverse media, including exposure to the Office of Foreign Assets Control (OFAC) list.
- On-Demand Reporting for CBP: Automatically generates detailed reports on the chain of custody and compliance of individual shipments in response to CBP inquiries and Withhold Release Orders (WROs).
CEO and founder of Sourcemap, Leonardo Bonanni, in an article in Sourcing Journal, expanded on the importance of the UFLPA. “The new law marks a ‘huge shift’ in the responsibility the businesses have over their supply chains. And where supply-chain mapping and tracing was challenging a decade ago, it’s now ’eminently possible’…The ULFPA is a turning point where no company can ignore its raw materials, its suppliers…It’s really a leadership position that the U.S. government is taking worldwide in enforcing the ban of forced labor and because of that, it’s become so much easier to do this because now every company that exports to the U.S. has to respond. [Businesses are] all providing traceability and transparency in their supply chain. And they’re providing it much more quickly than ever before.”