On April 23, 2024, the European Parliament overwhelmingly approved the Regulation Prohibiting the Marketing of Products Made with Forced Labor (EUFLR), with 555 votes in favor and 51 against. Following the European Parliament's re-election in June of the same year, the EU Council of Ministers is expected to formally approve the final text. The regulation will come into effect one day after its publication in the Official Journal of the European Union and will be implemented 36 months thereafter.
1. Scope of application:
(1) Products imported from the EU and products produced in the EU for domestic consumption or export;
(2) Products manufactured using various forms of forced labor.
(3) Products produced by any industry.
2. Authority for Investigations:
📍 When the risk of forced labor arises outside the EU, the European Commission will conduct the investigation. With the consent of the third country's government and industry, the Commission may also carry out on-site investigations in the third country.
📍 If forced labor occurs within the EU, the relevant authorities of the member states will handle the investigation.
3. Evaluating violations of regulations based on "risk" will consider the following criteria:
(1) The scale and severity of forced labor;
(2) The volume of products listed or circulated in the EU market;
(3) The proportion of parts produced using forced labor in relation to the final product;
(4) The distance between the operator’s position in the supply chain and the location of forced labor, along with the operator's ability to address the issue;
(5) The European Commission will create a " database of forced labor risk areas or products " to identify specific regions and industries where state-driven forced labor occurs, assisting the Commission and member state authorities in assessments. Additionally, the European Commission may require importers or exporters to provide extra information to customs (e.g., manufacturer and supplier details) for certain products or product categories.
4. Penalties:
📍If the European Commission or the competent authorities of member states determine that products are made using forced labor, they can order the removal of the affected products from the EU market (including e-commerce platforms) or confiscate them at the EU border. The operators will be required to report the donation, recycling, or destruction of the products.
📍If only certain parts of the final product violate the regulations and those parts are replaceable, only the illegal components need to be disposed of.
📍If the product is of strategic importance to the EU, it may be temporarily detained until the manufacturer addresses the issue of forced labor in its supply chain.
5. Information Disclosure and Exchange:
📍The European Commission will establish a "Single Portal for Forced Labor," offering guidelines, bans, a forced labor risk database, and a whistleblower portal.
📍The European Commission and the relevant authorities of member states will also form a network to improve information exchange.
📍The European Commission may work with third countries (especially those with similar legislation to the EU) through existing dialogue mechanisms or free trade agreements. This collaboration may involve sharing information on risk areas or products, as well as exchanging up-to-date enterprise data and best practices.
6. Implementation Date:
The regulations will take effect the day after their publication in the European Journal and will be fully implemented 36 months after publication. However, certain provisions, including Articles 5(3), 7, 8, 9(2), 11, 33, 34, 35, and 37(3), will come into force immediately upon publication.
References:
1. European Parliament press release:
2. Draft text of the EUFLR:
https://www.europarl.europa.eu/meetdocs/2014_2019/plmrep/COMMITTEES/CJ33/AG/2024/03-20/1298958EN.pdf
