U.S.-China Trade:

Implementation of the 1992 Prison Labor Memorandum of Understanding

GGD-95-106: Published: Apr 3, 1995. Publicly Released: Apr 3, 1995.

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GAO reviewed issues regarding the memorandum of understanding between the U.S. and China that prohibits the import of goods made with Chinese prison labor, focusing on the: (1) Customs Service's assessment of China's compliance; and (2) government's ability to obtain information sufficient to enforce the agreement.

GAO found that: (1) while China had not sufficiently demonstrated a willingness to meet its responsibilities under the agreement, Customs reported more recent signs of cooperation; (2) China recently signed an implementation agreement that could enhance mutual compliance and increase Customs' ability to visit prisons suspected of producing goods for export; (3) recordkeeping practices in China's prison system may inhibit its ability to comply with the agreement; (4) recently Customs has succeeded in obtaining information sufficient to make administrative determinations regarding potential prison-labor goods; (5) the Department of Justice was concerned that it might not get sufficient information to cost-effectively defend Customs' decisions; (6) Justice attorneys must produce information before the U.S. Court of International Trade (CIT) to defend Customs determinations to exclude apparent prison-labor imports; (7) in December 1994, a CIT decision that affirmed a Customs finding was upheld for the first time; and (8) Justice officials are concerned that its ability to sustain Customs' findings may be inhibited because much of the information necessary to uphold Customs' findings is no longer published in China.

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