Move condemns charity’s claims of poor working practices within its UK supply chain
The US authorities are investigating allegations of forced labor in Boohoo’s UK supply chain. This could result in the goods of the online fashion seller being confiscated at ports.
Customs and Border Protection (CBP), an agency that investigates modern slavery, is believed to have found enough grounds to conduct the investigation after Liberty Shared, a charity fighting against modern slavery, submitted a petition on February 1st detailing problems at Boohoo factories located in Leicester. CBP can order ports to stop releasing goods if it finds evidence that they were made with forced labor.
On 7 February, a second petition similar to this was sent. It highlighted potential problems at clothing factories in the Leicester East district. Boohoo is believed to have purchased more than 60% of these goods.
Boohoo refers to a variety of studies on conditions in Leicester factories, including an independent review by Alison Levitt QC last years and a study done by the Centre for Social Justice and Justice &. Last year, Care was published.
Boohoo-commissioned Levitt reviewed the allegations that poor working practices were a part of the company’s supply chains. Sir Brian Leveson, a retired judge who was involved in the phone hacking investigation, has been appointed by the company to oversee the restructuring of its supply chain.
Liberty Shared, a Hong Kong-based company, argues that Leicester’s supply chain has “a high potential to force labour”. This is partly due to the inability of the local police and government to provide protection, protection and prosecution for forced labor issues. The vulnerable are therefore at high risk.
Boohoo stated that it had not received any correspondence and was unaware of any investigation by CBP. CBP has the power to prohibit imports into the USA if it finds evidence modern slavery.
Manchester-based Boohoo stated that it was confident in its actions to ensure all its products comply with the CBP criteria to prevent forced labor entering the US (or any other market). Boohoo continues fulfilling orders in the US for all its brands. The group will cooperate with any authority that can ensure products coming from its supply chain comply with the requirements.
CBP stated that it couldn’t comment on whether any particular company was under investigation.
The body does however investigate allegations from a variety sources including campaigning groups and private citizens.
It can issue a “withhold order” to instruct ports to stop shipments if it finds “reasonably informing” evidence that forced labour was used in the production of goods. The importers have three months to return the goods or provide evidence that the merchandise was not manufactured using forced labour. The CBP issued 13 such orders last year, which was more than the four previous years.
Simon Bowler, an analyst with Numis, stated that orders to stop product imports under these regulations seem to be rare and that the nature of an investigation across an intricate supply chain that is currently being overhauled (for which no evidence has been found to support modern slavery) makes it feel remote.
He said that Boohoo was an important market in the USA, accounting for 25% of its revenues. However, concerns about a ban were another risk for investors.
Boohoo shares, which recently purchased Debenhams to go alongside its PrettyLittleThing and NastyGa, Warehouse, Karen Millen, Warehouse, Karen Millen, Oasis labels were down 4.5% Tuesday afternoon.