Senators launch probe into U.S. electronics firm's use of Uyghur labor
A trio of bipartisan senators sent a letter to Universal Electronics demanding the Nasdaq-listed company provide details on an alleged deal it struck with Chinese authorities to transport hundreds of Uyghur workers from Xinjiang to a plant in southern China.
Why it matters: The U.S. government has warned that businesses with supply chains and investments in Xinjiang, where China is accused of carrying out a genocide against Uyghur and other Muslim minorities, run a "high risk" of violating U.S. laws on forced labor.
Background: Universal Electronics acknowledged to Reuters this month that it has employed at least 400 Uyghurs as part of a worker-transfer agreement, but denied that they are treated any differently than other employees.
- It's the first confirmed example of a U.S. company participating in what human rights groups have described as a forced labor program designed to coerce the Uyghur population in Xinjiang, where China has engaged in a campaign of mass detention and surveillance since at least 2017.
- Universal has supplied equipment and software to Sony, Samsung, Microsoft and LG, among other tech companies, according to Reuters.
Driving the news: Sens. Bob Menendez (D-N.J.), Marco Rubio (R-Fla.) and Jeff Merkley (D-Ore.) are calling on Universal to provide details of its agreements with Chinese authorities, documentation proving that it is not using forced labor, and disclosures to shareholders about potential legal risks associated with the program.
- The senators wrote in the letter that the Reuters report suggests the company "is choosing to turn a blind eye" to atrocities.
- "If true, this is a serious failure in your firm’s ethical and fiduciary responsibilities - and, potentially, your duties under U.S. law," they warned.
What they're saying: "We look forward to working with Chairman Menendez, Ranking Member Rubio, and Senator Merkley on the questions they raised in the letter," a Universal spokesman told Axios in a statement.
- "UEI made the decision last week to end its relationship with the staffing agency that hired these workers based on feedback on how to best secure its supply chain and in light of ongoing regulatory and legislative changes globally."
Editor's note: This story has been updated with comment from Universal.