March 26, 2026

The Impacts of Forced Labor Prevention on U.S. Trade Policy: Trends for 2026

Isa Mirza Foley Hoag LLP - Global Business and Human Rights + Follow Contact LinkedIn Facebook X Send Embed

The Trump Administration has continued to make good use of the Uyghur Forced Labor Prevention Act (UFLPA) as its most potent legal tool for preventing the importation of goods made with forced labor.  While the UFLPA focuses on curbing forced labor abuses against persecuted minority communities in China, the law also strengthened the ability of CBP to detain goods derived from forced labor in many other jurisdictions where forced labor poses significant challenges – in particular Malaysia, Cambodia, Vietnam.  Other countries from which imports have been flagged at high rates include Thailand, India, Bangladesh, the Philippines, and Nicaragua. There is some debate over whether the Trump Administration is paring back UFLPA enforcement or remaining relatively consistent with efforts over previous years, and to the latter extent, whether the Administration is sufficiently building on enforcement.

The law provided human rights NGOs and researchers that map forced labor risks with a more direct conduit to regulators at DHS and CBP, and this input has been playing a sizeable role in setting the direction of CBP inspections into goods from high-risk sectors and countries.  According to a 2025 report led by Laura Murphy – a leading modern slavery researcher and a former top advisor on the issue at DHS – there were periods in 2025 when detentions dropped, particularly in April and May, before returning to levels more in line with past years.  In addition, the report posits that the Administration has not been proactive in adding new companies to the UFLPA Entity List.  The List identifies companies that are legally presumed to be using forced labor and hence bans all of their products from entering the United States.

The vicissitudes of enforcement across time and administration aside, the rate at which detained shipments are subsequently released had on average hovered at about 50% before the Trump Administration, meaning shipments had a fairly significant chance of being eventually deemed free of forced labor.  When the 2025 year is factored into the release rate, detention reversals since the UFLPA went into effect drop to about 35%.  But it’s not yet clear whether this affirms that the evidentiary bar is being raised by Trump’s CBP, or if other factors are at play.

Regardless, the release rates remain high and intimate that regulators may not yet have the resources and manpower to consistently apply the UFLPA’s stringent “clear and convincing” evidentiary standard that importers are supposed to demonstrate in order to rebut a presumption of forced labor.  Although there are likely situations in which importers have successfully challenged detentions that meet or fall below the statutory standard, it would be unwise for any company to conclude that enforcement is lax or unpredictable.

The UFLPA was passed with overwhelming bipartisan support in Congress and both parties see the law as a powerful mechanism for countervailing China’s ambitions.  Additionally, the Trump Administration’s trade war with China stands to gain from consistent application of the UFLPA, insofar as many of our goods flow from supply chains that either originate in China or overlap with Chinese industries.

And lawmakers on both sides of the aisle have taken ample opportunities to criticize enforcement standards.  In this vein, the Senate Finance Committee and the House Select Committee on China have led deeply probing investigations into enforcement practices, in the process calling out specific sectors and companies for alleged linkages to forced labor.  These investigations have also criticized companies for lacking due diligence and risk assessment systems to proactively identify forced labor exposures in their supply chains, particularly in China.

Congress has steadily increased spending levels for UFLPA enforcement and the Trump Administration has clearly signaled that it wants more funding for DHS and CBP as a whole.  Despite the current stalemate in Congress over DHS funding, we expect the appropriators to continue funding for UFLPA enforcement at current levels, if not increase allocations, as they draft the fiscal year 2027 funding bill for CBP this year.

The Administration is continuing to prioritize the inspection of goods in high-risk sectors that include automative manufacturing, electronics, polysilicon, apparels, and steel; and critical minerals such as lithium and copper.  More commercial sectors, product types, and materials could be added in the future, and CBP continues to weigh risk mapping data provided by researchers and civil society.

Addressing Forced Labor in Trade Agreements

The Trump Administration is also taking advantage of new bilateral and regional trade agreements to advance forced labor prevention efforts in key trading partner nations.

Provisions compelling governments to take greater action against forced labor could very well figure into the reauthorization of the U.S.-Mexico-Canada Agreement, which is a key legislative priority for Congress in 2026.  The USMCA, the signature trade policy of Trump’s first term, included language in Articles 23.12 and 23.6 calling for closer coordination between Washington, Mexico City, and Ottawa on eradicating forced labor in North American supply chains.  After the USMCA went into effect, Canada enacted a law that requires companies to report on their efforts to prevent forced labor and child labor, while Mexico’s Department of Labor promulgated a regulation prohibiting the import of goods made with forced labor.

Outside of North America, the U.S.-Malaysia Agreement on Reciprocal Trade that was signed in October 2025 also refers to forced labor obligations.  Article 2.9 requires Malaysia to implement a ban on imports made with forced labor within two years of the Agreement’s enforcement date.  Importantly, Article 2.9 further calls for Washington and Kuala Lumpur to share best practices regarding enforcement of the UFLPA and Malaysia’s import prohibitions.  Similarly, with respect to the U.S.-Cambodia Agreement on Reciprocal Trade, Article 2.8 requires Phnom Penh to implement a UFLPA-like prohibition on imports.  Commitments to eradicating forced labor are also referenced in the White House’s new agreements with Vietnam and Thailand, and Article 1.19 of the U.S.-Bangladesh Agreement on Reciprocal Trade that was signed in February obligates Dhaka to increase the number of labor inspectors and carry out unannounced inspections to identify forced labor and child labor violations.  This extends to Export Processing Zones, where regulatory regimes can be weaker and forced labor risks more acute.

Investigations into the Labor Practices of Trading Partners

We are also closely watching investigations by the Trump Administration into the trading practices of partner nations under authorities in the U.S. Trade Act, with the findings from these investigations expected to shine more light on forced labor challenges in key supply chains and jurisdictions.

Title III of the U.S. Trade Act of 1974 – titled “Relief from Unfair Trade Practices” – allows the Office of the U.S. Trade Representative (USTR) to investigate and take action (e.g., impose a tariff) to enforce U.S. rights under trade agreements and respond to foreign trade practices deemed to be unfair.  Under the Trump Administration, the USTR has framed forced labor prevention as an economic and national security imperative for the United States.  The Administration’s willingness to address this issue through the potential issuance of new tariffs indicates (1) how endemic and widespread forced labor remains, and (2) that forced labor poses major economic and security risks for the U.S trading system.

The USTR’s investigations, however, could have unintended consequences, notably by souring diplomatic relationships between the United States and the trading partners that feel squeezed by the scrutinizing nature of such inquiries.  Already, for example, investigations into Malaysia, Cambodia, and Vietnam have led those governments to consider delaying ratification or halting implementation of their trade agreements with Washington.

To reconcile this, civil society groups such as Transparentem have recommended that the USTR give countries under investigation a clear path and timeframe to address forced labor entering their countries before tariffs are imposed.  The labor rights watchdog group added that “the approach must be backed by investment in the capacity of national actors to develop effective policy, identify abuses both in imported goods and in domestic production, remediate, and prevent recurrence.”

With UFLPA inspections especially trained on these countries, the trade agreements and investigations are a further sign that companies will need to prioritize forced labor prevention in their policies, due diligence, risk assessment process, the monitoring of supply chain partners, and in their relationships with key stakeholders such as civil society and workers.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.
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