Temu’s Fast Fashion Empire Lacks Safeguards Against Forced Labor — Retail Bum

Chinese fast fashion retailer Temu is evading safeguards against the use of forced labor, according to an interim report by the American Select Committee on the Chinese Communist Party, chaired by Mike Gallagher and with Raja Krishnamoorthi as the ranking member.

The report, which is based on an investigation into the business practices of Shein and Temu, along with those of Nike and Adidas, found issues pertaining to forced labor and the exploitation of import regulations.

Shein and Temu were found to be abusing the ‘de minimis’ provisions, which let them evade customs enforcement. These provisions enable the entry of their products, valued under $800, into the United States without inspection or duties. Of particular concern is Temu’s lack of a robust system to ensure adherence to the Uyghur Forced Labour Prevention Act (UFLPA), raising worries about the potential introduction of fashion items produced through forced labor into consumers’ homes.

Speaking on the report’s findings, Chairman Gallagher expressed deep dismay, specifically underscoring Temu’s negligence in ensuring that its supply chains remain free from exploitative labor practices. He also highlighted that Shein and Temu’s exploitation of the de minimis loophole allows them to bypass import taxes and evade scrutiny.

Gallagher is calling for a thorough investigation into the exploitation of this loophole, asserting that it grants an unfair advantage to Shein, Temu, and other companies and places American companies at a disadvantage within the marketplace.

Krishnamoorthi echoed Gallagher’s concerns, emphasizing the crucial requirement of transparency from companies that may be benefiting from forced labor practices associated with the Chinese Communist Party (CCP).

The report’s initial findings reinforce the urgent need to confront and tackle these alarming practices. Krishnamoorthi said he is determined to strengthen the effectiveness of current laws, including the Uyghur Forced Labour Prevention Act (UFLPA), to eradicate forced labor and establish robust mechanisms for accountability.

Originally published at https://retailbum.com on June 29, 2023.