CECC Hearing Turns Spotlight On Supplier Audits & Certifications In China

On April 30, 2024, the Congressional-Executive Commission on China ("CECC") held a hearing entitled "Factories and Fraud in the PRC: How Human Rights Violations Make Reliable Audits Impossible," in which expert witnesses¹ testified that it was impossible to conduct reliable social compliance audits not only in the Xinjiang Uyghur Autonomous Region ("XUAR"), but throughout the People's Republic of China ("PRC").

The witnesses asserted that supplier audits conducted in the XUAR are unreliable, as the Chinese government obfuscates forced labor practices and criminalizes the investigation of such practices as a matter of policy. The discussion touched on the illustrative example of an audit conducted by Loening GmbH on a Volkswagen joint venture in the XUAR, which found no indication of forced labor at the site, despite the region's widely-acknowledged state-sponsored forced labor programs. Although several senior staff at Loening disavowed the audit results