I 

114TH CONGRESS 

1ST SESSION H. R. 3226 

To amend the Securities Exchange Act of 1934 to require certain companies 

to disclose information describing any measures the company has taken 

to identify and address conditions of forced labor, slavery, human trafficking, and the worst forms of child labor within the company’s supply 

chains. 

IN THE HOUSE OF REPRESENTATIVES 

JULY 27, 2015 

Mrs. CAROLYN B. MALONEY of New York (for herself and Mr. SMITH of New 

Jersey) introduced the following bill; which was referred to the Committee 

on Financial Services 

A BILL 

To amend the Securities Exchange Act of 1934 to require 

certain companies to disclose information describing any 

measures the company has taken to identify and address 

conditions of forced labor, slavery, human trafficking, 

and the worst forms of child labor within the company’s 

supply chains. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Business Supply Chain 

5 Transparency on Trafficking and Slavery Act of 2015’’. 


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1 SEC. 2. FINDINGS AND SENSE OF CONGRESS. 

2 (a) FINDINGS.—Congress finds the following: 

3 (1) In 2014, the Department of Labor identi4 fied 136 goods from 74 countries around the world 

5 made by forced labor and child labor. 

6 (2) The United States is the world’s largest im7 porter, and in the 21st century, investors, con8 sumers, and broader civil society increasingly de9 mand information about the human rights impact of 

10 products in the United States market. 

11 (3) Courts have ruled that consumers do not 

12 have standing to bring a civil action in United 

13 States courts for enforcement of a provision in the 

14 Smoot Hawley Tariff Act of 1930 prohibiting impor15 tation of goods made with forced labor or convict 

16 labor, and furthermore, the provision has a broad 

17 exception for goods that cannot be produced in the 

18 United States in sufficient quantities to meet the de19 mands of American consumers from tainted goods, 

20 consequently, there are fewer than 40 enforcement 

21 actions on record in the past 80 years. 

22 (4) Mechanisms under Federal law to prevent 

23 and punish perpetrators of forced labor, slavery, 

24 human trafficking, and the worst forms of child 

25 labor in the stream of commerce suffer from prob26 lems of limited scope, broad expectations, and lack 


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1 of available information about goods that are pro2 duced along supply chains tainted by these crimes 

3 and imported by the United States. 

4 (5) The Trafficking Victims Protection Reau5 thorization Act of 2003 (Public Law 108–193) to6 gether with the Trafficking Victims Protection Act 

7 of 2005 (Public Law 109–164) provide for the ter8 mination of Federal contracts where a Federal con9 tractor or subcontractor engages in severe forms of 

10 trafficking in persons or has procured a commercial 

11 sex act during the period of time that the grant, 

12 contract, or cooperative agreement is in effect, or 

13 uses forced labor in the performance of the grant, 

14 contract, or cooperative agreement. The Trafficking 

15 Victims Protection Act of 2005 also provides United 

16 States courts with criminal jurisdiction abroad over 

17 Federal employees, contractors, or subcontractors 

18 who participate in severe forms of trafficking in per19 sons or forced labor. 

20 (6) Executive Order 13126, Prohibition of Ac21 quisition of Products Produced by Forced or Inden22 tured Child Labor, Executive Order 13627, 

23 Strengthening Protections Against Trafficking In 

24 Persons In Federal Contracts, and title XVII of the 

25 National Defense Authorization Act for Fiscal Year 


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1 2013 (Public Law 112–239) have prohibited Federal 

2 contractors, subcontractors, and their employees 

3 from engaging in the following trafficking-related ac4 tivities: charging labor recruitment fees; confiscating 

5 passports and other identity documents of workers; 

6 and using fraudulent recruitment practices, includ7 ing failing to disclose basic information or making 

8 material misrepresentations about the terms and 

9 conditions of employment. Such Executive order and 

10 Acts also require Federal contractors, subcontrac11 tors, and their employees to maintain an anti-traf12 ficking compliance plan that includes, among other 

13 elements, a complaint mechanism and procedures to 

14 prevent subcontractors at any tier in the supply 

15 chain from engaging in trafficking in persons. 

16 (b) SENSE OF CONGRESS.—It is the sense of Con17 gress that— 

18 (1) forced labor, slavery, human trafficking, 

19 and the worst forms of child labor are among the 

20 most egregious forms of abuse that humans commit 

21 against each other, for the sake of commercial prof22 it; 

23 (2) the legislative and regulatory framework to 

24 prevent goods produced by forced labor, slavery, 

25 human trafficking, and the worst forms of child 


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1 labor from passing into the stream of commerce in 

2 the United States is gravely inadequate; 

3 (3) legislation is necessary to provide consumers 

4 information on products that are free of child labor, 

5 forced labor, slavery, and human trafficking; and 

6 (4) through publicly available disclosures, busi7 nesses and consumers can avoid inadvertently pro8 moting or sanctioning these crimes through produc9 tion and purchase of raw materials, goods and fin10 ished products that have been tainted in the supply 

11 chains. 

12 SEC. 3. DISCLOSURE OF INFORMATION RELATING TO EF13 FORTS TO COMBAT THE USE OF FORCED 

14 LABOR, SLAVERY, TRAFFICKING IN PERSONS, 

15 OR THE WORST FORMS OF CHILD LABOR. 

16 Section 13 of the Securities Exchange Act of 1934 

17 (15 U.S.C. 78m) is amended by adding at the end the 

18 following new subsection: 

19 ‘‘(s) DISCLOSURES RELATING TO EFFORTS TO COM20 BAT THE USE OF FORCED LABOR, SLAVERY, TRAF21 FICKING IN PERSONS, OR THE WORST FORMS OF CHILD

22 LABOR.— 

23 ‘‘(1) REGULATIONS.—Not later than 1 year 

24 after the date of enactment of the Business Supply 

25 Chain Transparency on Trafficking and Slavery Act 


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1 of 2015, the Commission, in consultation with the 

2 Secretary of State, shall promulgate regulations to 

3 require that any covered issuer required to file re4 ports with the Commission under this section to in5 clude annually in such reports, a disclosure whether 

6 the covered issuer has taken any measures during 

7 the year for which such reporting is required to 

8 identify and address conditions of forced labor, slav9 ery, human trafficking, and the worst forms of child 

10 labor within the covered issuer’s supply chain, and 

11 a description of such measures taken. Such disclo12 sure shall include, under the heading ‘Policies to Ad13 dress Forced Labor, Slavery, Human Trafficking, 

14 and the Worst Forms of Child Labor’, information 

15 describing to what extent, if any, the covered issuer 

16 conducts any of the following activities: 

17 ‘‘(A) Whether the covered issuer maintains 

18 a policy to identify and eliminate the risks of 

19 forced labor, slavery, human trafficking, and 

20 the worst forms of child labor within the cov21 ered issuer’s supply chain (such disclosure to 

22 include the text of the policy or substantive de23 scription of the elements of the policy), and ac24 tions the covered issuer has taken pursuant to 

25 or in the absence of such policy. 


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1 ‘‘(B) Whether the covered issuer maintains 

2 a policy prohibiting its employees and employ3 ees of entities associated with its supply chain 

4 from engaging in commercial sex acts with a 

5 minor. 

6 ‘‘(C) The efforts of the covered issuer to 

7 evaluate and address the risks of forced labor, 

8 slavery, human trafficking, and the worst forms 

9 of child labor in the product supply chain. If 

10 such efforts have been made, such disclosure 

11 shall— 

12 ‘‘(i) describe any risks identified with13 in the supply chain, and the measures 

14 taken toward eliminating those risks; 

15 ‘‘(ii) specify whether the evaluation 

16 was or was not conducted by a third party; 

17 ‘‘(iii) specify whether the process in18 cludes consultation with the independent 

19 labor organizations (as such term is de20 fined in section 2 of the National Labor 

21 Relations Act (29 U.S.C. 152)), workers’ 

22 associations, or workers within workplaces 

23 and incorporates the resulting input or 

24 written comments from such independent 

25 labor organizations, workers’ associations, 


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1 or workers and if so, the disclosure shall 

2 describe the entities consulted and specify 

3 the method of such consultation; and 

4 ‘‘(iv) specify the extent to which the 

5 process covers entities within the supply 

6 chain, including entities upstream in the 

7 product supply chain and entities across 

8 lines of products or services throughout the 

9 covered issuer’s product manufacturing. 

10 ‘‘(D) The efforts of the covered issuer to 

11 ensure that audits of suppliers within the sup12 ply chain of the covered issuer are conducted 

13 to— 

14 ‘‘(i) investigate the working conditions 

15 and labor practices of such suppliers; 

16 ‘‘(ii) verify whether such suppliers 

17 have in place appropriate systems to iden18 tify risks of forced labor, slavery, human 

19 trafficking, and the worst forms of child 

20 labor within their own supply chain; and 

21 ‘‘(iii) evaluate whether such systems 

22 are in compliance with the policies of the 

23 covered issuer or efforts in absence of such 

24 policies. 

25 ‘‘(E) The efforts of the covered issuer to— 


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1 ‘‘(i) require suppliers in the supply 

2 chain to attest that the manufacture of 

3 materials incorporated into any product 

4 and the recruitment of labor are carried 

5 out in compliance with the laws regarding 

6 forced labor, slavery, human trafficking, 

7 and the worst forms of child labor; 

8 ‘‘(ii) maintain internal accountability 

9 standards, supply chain management, and 

10 procurement systems, and reporting proce11 dures for employees, suppliers, contractors, 

12 or other entities within its supply chain 

13 failing to meet the covered issuer’s stand14 ards regarding forced labor, slavery, 

15 human trafficking, and the worst forms of 

16 child labor, including a description of such 

17 standards, systems, and procedures; 

18 ‘‘(iii) train the employees and man19 agement who have direct responsibility for 

20 supply chain management on issues related 

21 to forced labor, slavery, human trafficking, 

22 and the worst forms of child labor, particu23 larly with respect to mitigating risks within 

24 the supply chains of products; and 


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1 ‘‘(iv) ensure that labor recruitment 

2 practices at all suppliers associated with 

3 the supply chain comply with the covered 

4 issuer’s policies or efforts in absence of 

5 such policies for eliminating exploitive 

6 labor practices that contribute to forced 

7 labor, slavery, human trafficking, and the 

8 worst forms of child labor, including by 

9 complying with audits of labor recruiters 

10 and disclosing the results of such audits. 

11 ‘‘(F) The efforts of the covered issuer in 

12 cases where forced labor, slavery, human traf13 ficking, and the worst forms of child labor have 

14 been identified within the supply chain, to en15 sure that remedial action is provided to those 

16 who have identified as victims, including sup17 port for programs designed to prevent the re18 currence of those events within the industry or 

19 sector in which they have been identified. 

20 ‘‘(2) REQUIREMENTS FOR AVAILABILITY OF IN21 FORMATION.— 

22 ‘‘(A) DISCLOSURE ON COMPANY

23 WEBSITE.—The regulations promulgated under 

24 paragraph (1) shall require that the required 

25 information be disclosed by the covered issuer 


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1 on the Internet website of the covered issuer 

2 through a conspicuous and easily understand3 able link to the relevant information that shall 

4 be labeled ‘Global Supply Chain Transparency’. 

5 ‘‘(B) DISCLOSURE ON COMMISSION

6 WEBSITE.—The Commission shall make avail7 able to the public in a searchable format on the 

8 Commission’s website— 

9 ‘‘(i) a list of covered issuers required 

10 to disclose any measures taken by the com11 pany to identify and address conditions of 

12 forced labor, slavery, human trafficking, 

13 and the worst forms of child labor within 

14 the covered issuer’s supply chain, as re15 quired by this subsection; and 

16 ‘‘(ii) a compilation of the information 

17 submitted under the rules issued under 

18 paragraph (1). 

19 ‘‘(3) DEFINITIONS.—As used in this sub20 section— 

21 ‘‘(A) the term ‘covered issuer’ means an 

22 issuer that has annual worldwide global receipts 

23 in excess of $100,000,000; 

24 ‘‘(B) the terms ‘forced labor’, ‘slavery’, and 

25 ‘human trafficking’ mean any labor practice or 


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1 human trafficking activity in violation of na2 tional and international standards, including 

3 International Labor Organization Convention 

4 No. 182, the Trafficking Victims Protection Act 

5 of 2000 (Public Law 106–386), and acts that 

6 would violate the criminal provisions related to 

7 slavery and human trafficking under chapter 77 

8 of title 18, United States Code, if they had 

9 been committed within the jurisdiction of the 

10 United States; 

11 ‘‘(C) the term ‘remedial action’ means the 

12 activities or systems that an issuer puts in place 

13 to address non-compliance identified through 

14 monitoring or verification, and may apply to in15 dividuals adversely affected by the non-compli16 ant conduct or address broader systematic proc17 esses; 

18 ‘‘(D) the term ‘supply chain’, with respect 

19 to a covered issuer disclosing the information 

20 required under the regulations promulgated 

21 under this section, means all labor recruiters, 

22 suppliers of products, component parts of prod23 ucts, and raw materials used by such entity in 

24 the manufacturing of such entity’s products 


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1 whether or not such entity has a direct relation2 ship with the supplier; and 

3 ‘‘(E) the term ‘the worst forms of child 

4 labor’ means child labor in violation of national 

5 and international standards, including Inter6 national Labor Organization Convention No. 

7 182.’’. 

Æ 


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