Xinjiang: deadline passes for US firms to cut XPCC from supply chains
- US sanctions had been imposed on the sprawling Xinjiang Production and Construction Corps (XPCC) and its network of majority-owned subsidiaries
- Former Trump White House officials expect movement on the Uygur Forced Labour Bill in the lame duck congressional period, but it will be a race against time
The deadline has passed for American entities to comply with human rights sanctions and rid their supply chains of ties to the sprawling Xinjiang Production and Construction Corps (XPCC) and its network of majority-owned subsidiaries.
XPCC, a quasi-military entity estimated to employ 12 per cent of Xinjiang’s population and generate 17 per cent of its cotton-heavy economy, was sanctioned under the Magnitsky Act on July 31 by the US Treasury Department’s Office of Foreign Assets Control (OFAC) in connection “with serious rights abuses against ethnic minorities” in the northwestern Chinese region.
XPCC has been accused of using forced labour by Uygurs and other Muslim minority groups throughout its various supply chains. Experts say it is impossible to do business with China’s cotton and textile industries without also engaging with XPCC in some way.
The US Treasury Department’s sanctions initially gave companies until September 30 to cut ties with the XPCC, but the deadline was extended by two months, to Monday, after industry groups argued that they needed more time because the Xinjiang supply chain was too opaque for them to quickly comply.
As the extended deadline approached, the US Treasury Department received a negligible number of requests for another extension, an official familiar with US policy on Xinjiang told the Post.