What do the US forced-labour tariffs mean for your business?
Updated: Oct 17
Since 24 July 2026 the US has charged extra tariffs on most imports from 60 economies it says have not banned goods made with forced labour. Goods from Australia, New Zealand and Singapore pay 12.5%, while goods from the UK and the EU pay 10%. The rate is set per country, so no business can change it with better evidence. What the tariff signals is that forced labour now carries commercial consequences, and the laws that do reach individual businesses all ask for the same thing: evidence of what you know about modern slavery risk in your supply chain and what you have done about it.
Last updated: 17 October 2026
What are the US forced-labour tariffs?
On 23 July 2026 the Office of the US Trade Representative (USTR) finalised tariffs on 60 economies that it says have failed to ban imports made with forced labour. Economies that have committed to a ban pay 10%; those that have not pay 12.5% (MFAT):
Australia, New Zealand and Singapore: 12.5% on top of normal US duty.
United Kingdom: 10% on top of normal US duty.
European Union: 10% including normal US duty.
Some goods are exempt, and exemptions differ by product, so a customs broker should confirm specific goods. The tariff is being challenged in the US Court of International Trade, which has not yet ruled (Trade Law Daily).
What are businesses being asked to show?
The tariff applies to countries. The laws below apply to companies and products, and they are tightening in every one of these jurisdictions:
Australia: the Modern Slavery Act 2018 requires entities with consolidated revenue of at least $100 million to report on modern slavery risks in their operations and supply chains. In July 2026 the government announced these companies will have to take reasonable steps to prevent modern slavery, with a criminal offence for failing to do so. No bill has been released yet. See what the proposed reforms would change.
New Zealand: a Modern Slavery Bill would require entities with revenue over NZ$100 million to report, and a parliamentary committee has recommended it recognise equivalent Australian statements (DLA Piper).
Singapore: forced labour is a criminal offence under the Penal Code and the Prevention of Human Trafficking Act 2014. The government has said it is open to exploring systems to improve transparency and traceability in supply chains (People Matters).
United Kingdom: the Modern Slavery Act 2015 requires statements from organisations with turnover of £36 million or more. A bill before Parliament would make their content mandatory, covering supply chains, risks, due diligence, training and effectiveness, with fines of up to the greater of £1 million or 1% of turnover (Linklaters).
European Union: from 14 December 2027 the Forced Labour Regulation bans products made with forced labour at any stage of production from the EU market, for businesses of any size. Documented due diligence can be used as evidence in investigations (Baker McKenzie).
United States: Section 307 of the Tariff Act bans imports made with forced labour. To get detained goods released, an importer must show it made "every reasonable effort" to find out what labour was used in the goods and their components (Congressional Research Service).
Large companies pass these questions down to their suppliers, whatever the suppliers' size.
How does a structured evidence approach help?
The same few things come up across these laws: knowing who your suppliers are, knowing where the risks sit, setting expectations in contracts, and being able to show what you did. ESG Verified's Modern Slavery domain checks four evidence items that cover those points:
Supplier list: who your suppliers are. A US importer has to trace the labour behind its goods, and the EU regulation looks at every stage of production. Neither is possible without knowing who supplies you.
Modern slavery risk assessment: where the risks sit. Australia's Act requires reporting entities to describe the risks in their operations and supply chains, and the UK bill would make that mandatory content.
Supplier contract clauses: what you require of suppliers. The Australian Government's model modern slavery clauses require suppliers to address modern slavery risks and pass the obligations on to their subcontractors.
Modern Slavery Policy: your commitment, which the other three items put into practice.
What makes the approach structured:
Checked against the same rules for everyone. Each item is checked against fixed rules, the same for every organisation, rather than self-scored, so a buyer can compare suppliers on the same basis.
Kept current. Evidence is updated through a continuous cycle, and the exact versions behind each certificate are recorded, so you can show what was in place and when.
One evidence set for many requests. The same checked evidence answers questionnaires from different buyers, instead of a new set of documents for each. Our guide explains how a Modern Slavery Statement uses supplier evidence.
Easy for a buyer to check. A certificate has a public page and a listing in the ESG Verified directory. For a real example, see CFO Evolve's certification, which includes the Modern Slavery domain.
What it does not do: certification is not an audit or assurance engagement, it does not change any tariff rate, and it does not by itself make an organisation compliant with any specific law. See how certification works.
What can organisations do now?
Map where modern slavery risk sits in your operations and supply chain.
Get your core evidence in order and keep it current: policy, risk assessment, supplier contract clauses and supplier list.
Track the laws in the markets you sell into, not only your own.
If you export to the US, confirm your rate and any exemption with a customs broker.
Frequently asked questions
Can a business avoid the tariff by showing strong modern slavery evidence?
No. The rate is set per country, based on whether that country has a forced-labour import ban. Evidence matters for the import bans and due diligence laws that apply to individual businesses.
Which laws ask businesses for modern slavery evidence?
Examples include Australia's Modern Slavery Act 2018, the UK's Modern Slavery Act 2015, the US ban on forced-labour imports and, from 14 December 2027, the EU Forced Labour Regulation. Reforms are under way in Australia, New Zealand and the UK.
Is ESG Verified certification an audit?
No. No level of ESG Verified certification is an audit or assurance engagement. More answers are in our FAQ.
If your organisation, consultancy, procurement team or investment group needs structured, defensible Modern Slavery evidence, contact us through our Enquiry page.
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