In August 2022, new compliance requirements related to forced labor were introduced for CTPAT members. New and existing CTPAT Trade Compliance partners now need to meet some rigorous criteria aimed at eradicating the use of forced labor in supply chains. Partners will need to invest time and resources to ensure compliance, and their supply chain management practices will need to change.
New requirements have been introduced related to:
Supply chain mapping
Codes of conduct
Social compliance program implementation evidence
Non-compliance remediation plans
Best practice sharing
The new requirements bring the CTPAT program into line with existing US laws related to the prevention of the importation of goods made with forced labor. Trade Compliance partners are now obliged to take specific actions when it comes to their supply chain management practices. These practices are aimed at identifying the use of forced labor in supply chains and preventing it. As a result of the changes, the United States’ policy of targeting the use of forced labor now directly concerns supply chain management practices.
As well as the new requirements meaning that businesses will have to take action to adapt, there are also some new benefits associated with compliance. We’ll explain what they are later.
Detailed information about the new requirements is available in the CTPAT Trade Compliance Handbook.
The Customs Trade Partnership Against Terrorism (CTPAT) is a US private-public sector partnership that is designed to both strengthen US border security and improve international supply chains. Under CTPAT, US Customs and Border Protection (CBP) work with the private sector to safeguard the supply chain, identify security weaknesses and implement security measures and best practices.
For the private sector, there are numerous benefits to CTPAT membership, such as shorter waiting times at customs and eligibility to other US government programs.
The new requirements target the use of forced labor in supply chains and CTPAT Trade Compliance partners will need to meet 6 new compliance requirements by 1st August 2023.
CTPAT Trade Compliance partners need to carry out risk-based mapping of their supply chains that outlines supply chains in their entirety.
Areas of the supply chain that present the highest risk should be included in mapping. Partners are required to determine for themselves the imports that are considered the highest risk. However, they should also take into account information provided by CBP on the CBP website. Customs and Border Protection can request proof of supply chain mapping at any time.
Partners should produce a code of conduct statement outlining their position against the use of forced labor within their supply chain.
Not only this, but policies and procedures that put this code of conduct into operation and evidence of its implementation should be available. This code of conduct must be uploaded to the CTPAT online portal and published publicly. It should also be included in the partner’s social compliance program.
Evidence that a partner is implementing their social compliance program must be provided to US Customs and Border Protection. There are various things that can be counted as evidence of implementation. One example is the use of third-party supplier auditing, such as with a QIMA ethical audit like a WRAP audit.
Partners need to provide training to suppliers on their social compliance program, and CBP can also request proof of this training. Partners are able to determine the exact requirements of training, but it should ensure that they represent that they will not partner with any business that uses forced labor.
If the use of forced labor is discovered within the supply chain, partners must have a remediation plan in place and be prepared to take action. The steps that the organization should take to correct the situation and to inform CBP should be outlined. This remediation should be available if CBP request to see it.
Finally, partners are obliged to share their best practices with the CTPAT Trade Compliance program.
Note that there are also new requirements for CTPAT Security partners. As of January 2023, CTPAT Security partners are required to have a documented social compliance program in place that addresses forced labor in the supply chain.
Front of the Line Admissibility Review If a partner has a shipment detained because of concerns over the use of forced labor in the supply chain, their admissibility packages will be prioritized for review.
Redelivery Hold If a shipment arrives at a partner’s facility, but is subsequently held because of forced labor concerns, the partner will be able to hold their shipment at their facility rather than move it to a CBP facility.
Movement of Detained WRO Shipments to a Bonded Facility If a partner has a shipment withheld by CBP due to a Withhold Release Order, they will be able to move it to a bonded facility until CBP make an admissibility determination.
The changes to compliance requirements for CTPAT Trade Compliance partners are significant. The US government’s targeting of forced labor in supply chains now means that new practices will need to be followed in supply chain management. How effective the changes are at eradicating the serious problem of forced labor within supply chains remains to be seen, but CTPAT Trade Compliance partners will definitely feel the effect.
No matter where your supply chain extends to, a QIMA auditor can be on-site within 48 hours to perform a CTPAT audit that will provide you with accurate and comprehensive information for your CTPAT risk assessment. QIMA auditors have in-depth and up-to-date knowledge of CTPAT compliance requirements. At the outcome of the audit, we provide you with a detailed report that provides an overall assessment of your supply chain’s security strengths and vulnerabilities, including specific findings and a corrective action plan. Upon request, QIMA experts will work with you on specific areas of your supply chain security to help you meet CTPAT requirements and improve your supply chain. Easily schedule your CTPAT audit through our online platform, or contact us to find out more.
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