U.S. Customs and Border Protection (CBP) recently announced that it will block imports of goods that were produced with North Korean labor even though North Korean workers were employed outside of North Korea. The announcement was made after reports that Chinese-processed seafood Americans buy at Walmart, ALDI, and other stores has been produced with North Korean laborers. The concern is that because most of a North Korean laborer’s salary is paid directly to the North Korean government, Americans may inadvertently be subsidizing North Korean’s missile and nuclear weapons program. However, while CBP’s intentions are good, there is no law on the books that prohibits the importation of goods made by North Koreans outside of North Korea.
Regulations concerning North Korea-related imports include Executive Order 13570 and the Office of Foreign Assets Control (OFAC) North Korea sanctions. But these would not support CBP’s detention and seizure of products made outside of North Korea by North Korean laborers. Executive Order 13570 prohibits “the importation into the United States, directly or indirectly, of any goods, services, or technology from North Korea.” (Emphasis added). Section 510.201(c) of the OFAC sanctions on North Korea, which prohibits any transaction that would violate Executive Order 13570, effectively prohibits imports from North Korea without a license. Notwithstanding CBP’s good intentions, a product does not magically become an import from North Korea because a North Korean laborer worked on the product outside of North Korea.
Resolving a detention and/or seizure of imported products by CBP can be costly and time consuming. Delays can significantly disrupt a business’s operation. In light of CBP’s statements, we recommend that our clients reach out to their suppliers to ensure that their suppliers do not employ North Korean laborers.