Forced Labor 301 Doesn't Detail Harm Attributable to Each Country; Says Complying With UFLPA Costly

The report concludes that most countries should face a 12.5% tariff on a subset of their exports to the U.S. due to the harm their lack of action has inflicted; the EU, the United Kingdom, Canada, Ecuador, Indonesia, Mexico, Pakistan, Argentina, Bangladesh, Cambodia, El Salvador, Guatemala, Malaysia and Taiwan should have 10% tariffs, the USTR says.

There will be many exceptions to these tariffs, including USMCA-compliant goods of Canada or Mexico; and textiles and apparel articles covered by CAFTA-DR; tropical fruits and vegetables and spices; oil, gas and coal-related products, numerous chemicals, minerals and ores; medicines; goods for the aerospace sector; goods already subject to Section 232 tariffs, metals in chapters 80 and 81, and semiconductor-related items.

Scottish whiskey is, however, subject to the tariffs, though the president earlier said he would exempt it from 10% tariffs after a plea from King Charles.

As was done in the Bangladesh reciprocal trade deal, the USTR proposes that a tariff rate quota be granted to some apparel, in an amount equivalent to the quantity of U.S. textile exports the apparel-producing country imports. It didn't say whether it proposes tariff-free access within the quota, and solicited comments on how this mechanism should be set up, "including the U.S. and foreign products to be covered, the relative market opportunities for each side, and the tariff rate (if any) to be applied to products subject to that mechanism, as well as whether a similar mechanism should apply to any other product or sector."

The report's case studies include that Poland's imports of U.S. tobacco declined by 57% between 2015 and 2025 at the same time its imports of tobacco from Malawi increased by 171%. The U.S. imposed a withhold release order on Malawi tobacco, though some producers were later able to get removed from the WRO due to mitigation. Poland then made cigarettes that were exported to many of the countries under investigation, the report noted, which shows the competitive disadvantage can extend to downstream products.

The report also argued that a decline in rice exports to these 60 economies of 24% from 2014 to 2025 was concurrent with an increase of imports of rice from Myanmar, which employs forced labor. However, the amount of rice imported from Myanmar in 2025 was still lower than the U.S. rice volume that year.

The report said it's "well documented that forced labor is used in the production of cattle in Brazil." It noted that the 60 economies subject to the review nearly doubled their imports of frozen beef from Brazil while only increasing imports of U.S. beef by 21% from 2015 to 2025. It shared a chart of the relative size of Brazilian and U.S. sales to China over the period, but that chart didn't support the argument that Brazil has a cost advantage due to forced labor; rather, the U.S. sold more to China from 2020 to 2024, and the trade war last year caused a precipitous decline.

The report quoted evidence from the National Council of Textile Organizations that a significant amount of apparel imports use Xinjiang cotton, which is presumed to be harvested with forced labor and that "Bangladesh, Cambodia, Indonesia, and Vietnam [are] the primary producers of such exports."

The report said, "While not all of the decline in U.S. apparel production is necessarily the result of competition from forced labor goods, the prevalence of such goods in global apparel supply chains strongly suggests that unfair competition from apparel goods produced with forced labor inputs is one factor that has contributed to this decline."

Most of the decline in textile production in the U.S., according to a fashion industry professor, was before 2010; the intense oppression of Uyghurs in China began in 2014.

Aside from these case studies, the report didn't point to the burden on commerce attributable to each country's lack of an import ban, or insufficient design or enforcement of such bans.

It argued that forced labor laws are effective if they include a public entity list and the use of a rebuttable presumption where the use of forced labor is established for a particular good, with clear evidentiary standards. Laws should also include an accessible way to make allegations and public disclosures. However, the U.S. law, outside of the Uyghur Forced Labor Prevention Act, doesn't include a rebuttable presumption, even when a good was identified as being at high risk of being made with forced labor from a particular country.

The report also argued that because other countries don't enforce an import ban, their importers are spared due diligence costs. It said it's estimated that the costs of complying with UFLPA are equivalent to a 2.5% tariff on goods that have heightened risks of links to Uyghur labor. It quoted Nate Herman, from the American Apparel and Footwear Association, estimating that compliance costs may be in the billions of dollars.

Peter Harrell, a former Biden supply chain adviser on the National Economic Council, wrote on X that "while there is some country-by-country analysis of how individual investigated countries either do not have or do not enforce prohibitions on importers made by forced labor, there is not detailed country-by-country analysis about how those imports harm US commerce. Instead, USTR relies on the case studies and more general, global macroeconomic studies of forced labor in the global economy to argue harm."

He said this report is less detailed than past Section 301 investigations that describe the offending trade practices, and he said he thinks they're an attempt to recreate the International Emergency Economic Powers Act tariffs.

"There will be litigation around the tariffs, and it will be interesting to see how that plays out," he wrote.

Members of Congress split on their views of the proposal. Sen. Jeanne Shaheen, D-N.H., the top Democrat on the Senate Foreign Relations Committee, issued a statement that said, "his latest attempt to impose sweeping tariffs on dozens of our trading partners under the guise of cracking down on forced labor practices is a transparent pretext to force a new tax on the American people, who are already paying more for everyday essentials as a result of the President’s war in Iran and economic agenda."

House Ways and Means Committee Chairman Jason Smith, R-Mo., issued a statement saying: “President [Donald] Trump is standing up for American workers, fulfilling his commitment to use tariffs to address unfair trade practices, and continuing America’s longstanding leadership in the fight to prohibit trade in goods made with forced labor.

“USTR’s report makes clear that too many of our trading partners fall short of even basic cooperation with the United States on this issue, as very few trading partners even have laws on the books to prohibit trade in goods made with forced labor.”

The EU has a law, but it won't take effect until early 2027. Bernd Lange, the head of the trade committee in the EU Parliament, wrote, "Accusing [the] EU of not doing enough against forced labour is absurd. The EU has adopted the world's most stringent rules against products made with forced labour. This looks very much like trying to make the facts fit a legal justification for tariffs that has already been decided."