Congress Urges DHS to Protect American Textile Industry from ‘Illegal Customs Practices’

Congressional lawmakers are throwing their weight behind the Department of Homeland Security’s (DHS) pledge to safeguard the American textile sector from illegal foreign influence.

This week, 40 House Democrats and nine Senate Democrats penned letters to Secretary of Homeland Security Alejandro Mayorkas underscoring DHS’ commitment to bump up efforts to detect, prevent and prosecute customs fraud through a dedicated textile sector enforcement plan.

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On Jan. 30, Mayorkas met with members of the National Council of Textile Organizations (NCTO)—including manufacturers that support the apparel, home goods, PPE and industrial textile supply chains—to discuss how Uyghur Forced Labor Prevention Act (UFLPA) violations and a deluge of de minimis shipments have harmed U.S. industry. Under existing trade law, shipments from foreign markets worth under $800 can be delivered to shoppers’ doorsteps duty free.

As a result of that meeting, Mayorkas directed U.S. Customs and Border Protection (CBP), Homeland Security Investigations (HSI), and other agencies and offices within DHS to step up UFLPA enforcement efforts and develop an action plan to address the limitations of current trade legislation within 30 days.

“The importance of the contents of the action plan and its immediate implementation cannot be overstated,” Rep. Rosa L. DeLauro (D-Conn.) wrote on behalf of the House Democratic Caucus on Wednesday. The issues outlined “are of utmost concern to our constituents and the future of the American textile industrial base, an essential industry that not only contributes significantly to the U.S. economy but also supplies essential products, such as critical national defense materials and medical personal protective equipment,” she added.

“Without a demonstrative, expeditious, and effective customs enforcement plan, the devastation currently felt throughout the critically important textile production chain that employs nearly 550,000 U.S. workers and produces almost $66 billion in output annually will only worsen,” the letter said.

Signatories noted that the impacts of the forthcoming plan will reverberate beyond the U.S. textile sector, as the industry is part of “a broader hemispheric co-production chain” with partners in Mexico and Central America. Those relationships are built on free trade agreements that include rules of origin, labor and environmental standards, supporting 2 million textile and apparel jobs.

Allowing shipments from non-market economies like China unfettered access to the U.S. market undercuts economic opportunity across the Western hemisphere, they argued. At least 10 textile plants have closed in the U.S. alone in recent months.

Rep. DeLauro said the group is “keenly interested” in the contents of the forthcoming action plan and follow-through “given its importance to our constituents and policy priorities around trade enforcement, jobs, nearshoring, and critical industries.”

Friday morning saw Senate Democrats follow up with their own missive to the DHS lead.

“The scale and scope of illegal customs practices undercutting the competitiveness of domestic manufacturers is daunting, and this problem cannot be fixed without a robust, expeditiously deployed enforcement plan,” Sen. Sheldon Whitehouse (D-R.I.) wrote. The lawmaker previously helped convene the Rhode Island Textile Innovation Network and is a co-sponsor of Sen. Sherrod Brown’s (D-Oh.) Import Security and Fairness Act, which aims to stop non-market economies from exploiting the de minimis trade rule.

“Harmful and illegal customs practices take various forms,” including abuses of the Section 321 de minimis tariff waiver system, circumvention of the UFLPA and Section 301 punitive tariffs on China-made goods. “As part of your enforcement plan, we encourage you to comprehensively address each of these avenues for fraud,” the letter continued.

The immediate implementation of a robust customs enforcement plan is imperative to secure the future of the U.S. textile production sector.

“After facing decades of unfair trade practices, textiles manufacturers are seeing unprecedented demand destruction and dangerously low capacity utilization rates,” Sen. Whitehouse wrote. “Without an expeditious and effective enforcement plan, the devastation felt throughout the production chain will only worsen.”

Sen. Whitehouse also wrote that an enforcement plan is critical to advance President Joe Biden’s White House Council on Supply Chain Resilience, which DHS helped launch in November with the goal of bolstering operations critical to the country’s economic and national security.

“In closing, we welcome your call for an action plan and will be keenly interested in the contents and follow-through given its importance to our constituents and American economic

competitiveness,” the letter said. It was signed by Senators Brown, Elizabeth Warren (D-Mass.), Mark Warner (D-Va.), Jon Ossoff (D-Ga.), Raphael Warnock (D-Ga.), Jeanne Shaheen (D-N.H.), Tim Kaine (D-Va.) and Jack Reed (D-R.I.).

The issue of de minimis reform is quickly gaining traction on The Hill. On Saturday, Senators Brown and Rick Scott (R-Fla.) wrote to President Biden, urging him to use his executive authority to end de minimis altogether.

Meanwhile, Representatives Earl Blumenauer (D-Ore.), Neal Dunn (R-Fla.) and Dan Bishop (R-N.C.) announced the Coalition to Close the De Minimis Loophole on Friday. The lawmakers and other advocates, including labor unions, law enforcement, manufacturers and business associations, will hold a press conference March 6 to talk about congressional efforts to alter the provision.

Also on Friday, the U.S.-China Economic and Security Review Commission hosted an all-day hearing dubbed “Consumer Products from China: Safety, Regulations and Supply Chains” hosted by Committee Chairman Robert Cleveland and Commissioner and NCTO lead Kim Glas.