I 

112TH CONGRESS 

1ST SESSION H. R. 2759 

To require companies to include in their annual reports to the Securities 

and Exchange Commission a disclosure describing any measures the 

company has taken during the year 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 

AUGUST 1, 2011 

Mrs. MALONEY (for herself, Mr. SMITH of New Jersey, Ms. SPEIER, and Mr. 

MCGOVERN) introduced the following bill; which was referred to the Committee on Financial Services 

A BILL 

To require companies to include in their annual reports to 

the Securities and Exchange Commission a disclosure 

describing any measures the company has taken during 

the year 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, ETC. 

4 (a) SHORT TITLE.—This Act may be cited as the 

5 ‘‘Business Transparency on Trafficking and Slavery Act’’. 


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1 (b) FINDINGS.—Congress finds that— 

2 (1) in 2010, the Department of Labor identified 

3 128 goods from 70 countries around the world made 

4 by forced labor and child labor; 

5 (2) the United States is the world’s largest im6 porter, and in the twenty-first century, investors, 

7 consumers, and broader civil society increasingly de8 mand information about the human rights impact of 

9 products in the United States market; 

10 (3) in 2010, California enacted the first State 

11 law requiring manufacturers and retail companies to 

12 publicly disclose their policies to eradicate slavery, 

13 forced labor, and human trafficking within their 

14 supply chains; 

15 (4) the Smoot-Hawley Tariff Act of 1930, 

16 which prohibits importation of goods made with 

17 forced labor or convict labor, has a broad exception 

18 for goods that cannot be produced in the United 

19 States in sufficient quantities to meet the demands 

20 of American consumers; 

21 (5) courts have also ruled that consumers do 

22 not have standing to bring a civil action in United 

23 States courts for enforcement of this provision of the 

24 Tariff Act, because the legislative intent was to pro25 tect American manufacturers from unfairly priced 


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1 goods, not to protect consumers from tainted goods, 

2 consequently, there are fewer than 40 enforcement 

3 actions on record in the past 80 years; and 

4 (6) other mechanisms related to slavery and 

5 trafficking in the stream of commerce suffer from 

6 similar problems of limited scope, broad exceptions, 

7 and inability to provide information about specific 

8 suppliers whose goods are tainted. 

9 (c) SENSE OF CONGRESS.—It is the sense of Con10 gress that— 

11 (1) forced labor, slavery, human trafficking and 

12 the worst forms of child labor are among the most 

13 egregious forms of abuse that humans commit 

14 against each other, in the name of commercial prof15 it; 

16 (2) the legislative and regulatory framework to 

17 prevent goods produced through forced labor, slav18 ery, human trafficking, and the worst forms of child 

19 labor from passing into the stream of commerce in 

20 the United States is gravely inadequate; and 

21 (3) legislation is necessary to provide the infor22 mation that the public demands, recognizing that 

23 businesses can be part of the solution to these prob24 lems when they transparently provide information to 

25 consumers and investors, and subsequently respond 


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1 to consumer and investor demands for business rea2 sons, rather than solely reacting to governmental 

3 prescriptions on how to conduct their business. 

4 SEC. 2. DISCLOSURE TO SEC RELATING TO SLAVERY CON5 DITIONS WITHIN PRODUCT SUPPLY CHAINS. 

6 Section 13 of the Securities Exchange Act of 1934 

7 (15 U.S.C. 78m), is amended by adding at the end the 

8 following new subsection: 

9 ‘‘(r) DISCLOSURES RELATING TO SLAVERY CONDI10 TIONS WITHIN PRODUCT SUPPLY CHAINS.— 

11 ‘‘(1) REGULATIONS.—Not later than 270 days 

12 after the date of the enactment of this subsection, 

13 the Commission shall promulgate regulations requir14 ing any person required to file reports with the Com15 mission under this section to include annually in 

16 such reports, beginning with the person’s first full 

17 fiscal year that begins after the date of promulga18 tion of such regulations, a disclosure of any meas19 ures such person has taken during the year for 

20 which such reporting is required to identify and ad21 dress conditions of forced labor, slavery, human traf22 ficking, and the worst forms of child labor within 

23 such person’s supply chains. Such disclosure shall 

24 include the following information under the heading 

25 ‘Policies to Address Forced Labor, Slavery, Human 


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1 Trafficking and the Worst Forms of Child Labor’ 

2 describing to what extent, if any, the person con3 ducts any of the following activities: 

4 ‘‘(A) Maintains a policy to identify and 

5 eliminate risks of forced labor, slavery, human 

6 trafficking, and the worst forms of child labor 

7 within its supply chain. If the person maintains 

8 such a policy, the disclosure shall include the 

9 text of the policy or a substantive description of 

10 the elements of the policy. 

11 ‘‘(B) Maintains a policy prohibiting the use 

12 of the person’s corporate products, facilities, or 

13 services to obtain or maintain someone under 

14 conditions of forced labor, slavery, human traf15 ficking, and the worst forms of child labor. 

16 ‘‘(C) Engages in verification of product 

17 supply chains to evaluate and address risks of 

18 forced labor, slavery, human trafficking and the 

19 worst forms of child labor. The disclosure 

20 shall— 

21 ‘‘(i) describe the greatest risks identi22 fied within the supply chain, and the meas23 ures taken toward eliminating those risks; 


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1 ‘‘(ii) specify whether the verification 

2 was or was not conducted by a third party; 

3 and 

4 ‘‘(iii) specify whether the verification 

5 process includes consultations with inde6 pendent unions, workers’ associations, or 

7 workers within workplaces and incor8 porates the resulting certification or writ9 ten comments from such independent 

10 union, workers’ associations, or workers. 

11 ‘‘(D) Ensures that audits of suppliers are 

12 conducted to evaluate supplier compliance with 

13 the person’s company standards for eliminating 

14 forced labor, slavery, human trafficking, and 

15 the worst forms of child labor in supply chains. 

16 The disclosure shall specify if the verification 

17 was not an independent, unannounced audit. 

18 ‘‘(E) Assesses supply chain management 

19 and procurement systems of suppliers in the 

20 person’s supply chain, to verify whether said 

21 suppliers have in place appropriate systems to 

22 identify risks of forced labor, slavery, human 

23 trafficking, and the worst forms of child labor 

24 within their own supply chain. 


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1 ‘‘(F) Requires suppliers in its supply chain 

2 to certify that materials incorporated into the 

3 product comply with the laws regarding forced 

4 labor, slavery, human trafficking, and the worst 

5 forms of child labor of the country or countries 

6 in which they are doing business. 

7 ‘‘(G) Maintains internal accountability 

8 standards, supply chain management and pro9 curement systems, and procedures for employ10 ees or contractors failing to meet the person’s 

11 company standards regarding forced labor, slav12 ery, human trafficking, and the worst forms of 

13 child labor. The report shall describe such 

14 standards and systems. 

15 ‘‘(H) Provides the person’s employees and 

16 management who have direct responsibility for 

17 supply chain management, training on forced 

18 labor, slavery, human trafficking and the worst 

19 forms of child labor, particularly with respect to 

20 mitigating risks within the supply chains of 

21 products. 

22 ‘‘(I) Ensures that recruitment practices at 

23 all suppliers comply with the person’s company 

24 standards for eliminating exploitive labor prac25 tices that contribute to forced labor, slavery, 


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1 human trafficking, and the worst forms of child 

2 labor, including by conducting audits of labor 

3 recruiters and disclosing the results of such au4 dits. 

5 ‘‘(J) In cases where forced labor, slavery, 

6 human trafficking, and the worst forms of child 

7 labor have been identified within the supply 

8 chain, ensures that remediation is provided to 

9 those who have been identified as victims. 

10 ‘‘(2) INTERACTIVE DATA FORMAT.—The rules 

11 issued under paragraph (1) shall require that the in12 formation included in the person’s annual report be 

13 submitted in electronic form in an interactive data 

14 format. 

15 ‘‘(3) PUBLIC AVAILABILITY OF INFORMATION.— 

16 To the extent practicable, the Commission shall 

17 make available to the public in a searchable format 

18 on a website, a compilation of the information re19 quired to be submitted under the rules issued under 

20 paragraph (1). 

21 ‘‘(4) PUBLICATION ON THE COMPANY’S

22 WEBSITE.—Any person filing the disclosure required 

23 by paragraph (1) shall make available such disclo24 sure on the person’s Internet website with a con25 spicuous and easily understood link to the relevant 


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1 information placed on the homepage of the website. 

2 The link on the homepage shall be labeled ‘‘Policies 

3 to Address Forced Labor, Slavery, Human Traf4 ficking and the Worst Forms of Child Labor.’’ In 

5 the event the person does not have an Internet 

6 website, the person shall provide the written disclo7 sure within 30 days after receiving a written request 

8 for the disclosure from an investor or consumer. 

9 ‘‘(5) DEFINITIONS.—For purposes of this sub10 section— 

11 ‘‘(A) the term ‘‘forced labor, slavery, 

12 human trafficking and the worst forms of child 

13 labor’’ means child labor in violation of inter14 national standards including International 

15 Labor Organization Convention No. 182 and 

16 acts that would violate the criminal provisions 

17 related to slavery and human trafficking under 

18 chapter 77 of title 18 if they had been com19 mitted within the jurisdiction of the United 

20 States; 

21 ‘‘(B) the term ‘person’ means any publicly22 traded or private entity required to submit any 

23 annual report to the Commission, and having 

24 annual worldwide global receipts in excess of 

25 $100,000,000; 


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1 ‘‘(C) the term ‘remediation’ means the ac2 tivities or systems that a company puts in place 

3 to address non-compliance with the standards 

4 identified through monitoring or verification, 

5 which may apply to individuals adversely af6 fected by the non-compliant conduct or address 

7 broader systematic processes; 

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

9 to a person filing the disclosure required by 

10 paragraph (1), means all suppliers of products, 

11 component parts of products, and raw materials 

12 used by such person in the manufacturing of 

13 such person’s products or the provision of such 

14 person’s services, whether or not such person 

15 has a direct relationship with the supplier; and 

16 ‘‘(E) the term ‘verification’ means the 

17 process by which a company is evaluated to de18 termine compliance with its documented pro19 gram, including standards on forced labor, slav20 ery, human trafficking, and the worst forms of 

21 child labor, including an evaluation of— 

22 ‘‘(i) data gathered through monitoring 

23 activities to ensure results are reliable and 

24 process is credible; and 


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1 ‘‘(ii) the system established to reme2 diate violations to determine if remediation 

3 is implemented and effective.’’. 

Æ 


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