Congressional-Executive Commission on China (CECC): Upcoming Hearing "Factories and Fraud in the PRC: How Human Rights Violations Make Reliable Audits Impossible"

 

Pix Credit Wall Street Journal

 

The  Congressional-Executive Commission on China (CECC), like other American authorities, have stepped up their pressure on US companies to more resolutely comply with US based sanctions regimes directed. among other places, to China. To that end they have been engaging in what I have called a two thrust policy.

[T]he CECC have begun to understand how one might engage these dual levers to project power across borders and to strengthen (and discipline) a specific norm enhancing narrative that aligns with national policy (and presumably national political and normative values).  To that then, the leadership of the CECC has recently engaged in a two track approach to projecting power and asserting pressure against Chinese policy and policy implementation in Xinjiang.  It has done this by announcing a two thrust campaign.  The first seeks to affect the societal sphere by putting pressure on market actors to evidence fidelity to national (and perhaps international) human rights values in accordance with a specific application, in their market transactions.  In this case CECC chose a high value target-- the endorsement deals of NBA players that are deemed to enhance the ability of Chinese authorities to continue to augment their implementation of what to the US are objectionable policies in Xinjiang. The mechanics are societal.  CECC produced a "noisy" and much publicized letter to the National Basketball Association, which was then widely reported through key press organs in the United States (see, e.g., US News & World Report; New York Times; South China Morning Post; Reuters; Daily Mail; etc.).

Simultaneously CECC's leaders have introduced legislation, the Uyghur Forced Labor Prevention Act (UFLPA) HR 1155 (117th Cong. 1st Sess. 2021), which does two things.  First it serves to develop an authoritative narrative embedded in law (through the preamble and its findings).  This is a tactic that has become quite important in the way that the US legislature seeks to develop authoritative signification, that is the way that an authoritative interpretation of facts is developed by the political authorities in the United States ( UFLPA ¶ 2 (Findings). Second,  it serves to enhance a legal framework for decoupling trade that is connected to "all goods, wares, articles, and merchandise mined, produced, or manufactured wholly or in part in the Xinjiang Uyghur Autonomous Region of China, or by persons working with the Xinjiang Uyghur Autonomous Region government for purposes of the ‘‘poverty alleviation’’ program or the ‘‘pairing-assistance’’ program which subsidizes the establishment of manufacturing facilities in the Xinjiang Uyghur Autonomous Region" (UFLPA § 4(a)). (The US Two-Thrust Campaign Against Chinese Policy in Xinjiang: The Congressional-Executive Commission on China (CECC) Coordinates Use of Markets (NBA Endorsements) and Statutes (Uyghur Forced Labor Prevention Act)). 

The two thrust strategy has been applied to the lucrative sports market (Ramping Up Sanctions Related Pressure on US Enterprises in Sport: Congressional-Executive Commission on China (CECC) Versus National Basketball Association and its Players Association). And it has been applied to borrow the (mostly European) construction of a broadened narrative of complicity (The Emerging (Sanctions Fueled) Face of the Transnational Regulation of the Human Rights Effects of Economic Activity: The CECC Hearing on "Corporate Complicity: Subsidizing the PRC’s Human Rights Violations"). 

And now it has been applied, in a quite interesting way, to the emerging narratives of human rights due diligence. and forced labor. To that end, CECC appears to have begun to put a potentially powerful American spin (see eg here) on the European conversation on mandatory sustainability due diligence (here, here, and here) and forced labor (here). And, indeed, the synergies can produce something of a variegated united front. "Forced labor import bans also are in place in the United States (see here), Canada and Mexico (see here). Several jurisdictions also have modern slavery reporting statutes. The newest of these is Canada’s Fighting Against Forced Labour and Child Labour in Supply Chains Act. The first reports under that Act are due on May 31 (see here, here and here)." (here).  

These might have strong and potentially directed effects  on China. That certainly, may be suggested by the upcoming hearings of the CECC: "Factories and Fraud in the PRC: How Human Rights Violations  Make Reliable Audits Impossible."  The focus is social auditing.

Typically, social audits consist of periodic inspections of work sites, once every year or two. Many auditing firms conduct them on a contract-basis for a fee.  Inspectors—or “auditors”—have a herculean task. They have to assess compliance on a range of human rights concerns within just a few days. Auditors do this by going through documents that workplace managers produce, making observations, and interviewing workers. (Social Audit Reforms and the Labor Rights Ruse)

The hearing is to be held at the 2020 Rayburn House Office Building | Tuesday, April 30, 2024 - 10:00am. Information about the hearing and the program follows.  The written testimony of the participants will be posted when made available. 

 

 

Factories and Fraud in the PRC: How Human Rights Violations

Make Reliable Audits Impossible

 

Tuesday, April 30, 2024

2020 Rayburn House Office Building

10 am-12 pm

 

Social compliance auditing and certifications of factories and supply chains in the People’s Republic of China (PRC) proliferated over the past 20 years as global brands and retailers sought to respond to concerns over human rights and environmental abuses in their supply chains. The Uyghur Forced Labor Prevention Act requires that supply chains be free of forced labor, yet companies are using social audits and certifications to help cover up rather than expose human rights abuses. The recent controversy over German automaker Volkswagen’s use of an auditing company to state that there was no forced labor at its factories in the Xinjiang Uyghur Autonomous Region (XUAR) is an emblematic case that raises questions about corruption, conflicts of interest, unreliability, and other problems with social audits, particularly those conducted in the XUAR, where state-sanctioned forced labor is endemic. The purpose of this hearing is to shine a light on abuses of third-party social audits and certifications in the PRC, and to determine what additional steps need to be taken to uncover human rights violations and labor abuses in supply chains in China.

 

This hearing builds on previous hearings hosted by the Congressional-Executive Commission on China (CECC), highlighting labor abuses in the PRC’s fishing and seafood processing industries and the complicity of corporations in forced labor. Witnesses will describe the connection between social audits and global brands and retailers in China, as well as the problems associated with social audits in the PRC, and offer recommendations on what more can be done to ensure supply chains are free of goods made with forced labor.

 

The hearing will be livestreamed on the CECC’s YouTube channel.

 

Witnesses:

 

Panel 1

 

Thea Lee, Deputy Undersecretary for International Affairs at the U.S. Department of Labor

 

Panel 2

 

Scott Nova, Executive Director of the Worker Rights Consortium    

Adrian Zenz, Senior Fellow and Director in China Studies, Victims of Communism Memorial Foundation

Jim Wormington, Senior Researcher and Advocate on Corporate Accountability, Human Rights Watch