Camel Group Urges 'Preponderance' Standard for UFLPA Entity List Removal Decisions

Camel Group is a large manufacturing company, producing over 400 different products, that established two affiliates -- Camel Group Xinjiang Renewable Resources Co. and Camel Group Xinjiang Storage Battery Co. -- in the Xinjiang Uyghur Autonomous Region (XUAR) in 2015 and 2017. However, the company said neither of its Xinjiang affiliates ships products to the U.S. After unsuccessfully requesting to be removed from the UFLPA Entity List, the exporter challenged FLETF's decision, arguing the task force "utterly disregarded, ignored and trampled" its due process rights in a "flawed and poorly executed process" (see 2501210052).

In its motion for judgment, Camel urged the Court of International Trade to impose a "preponderance of the evidence" standard of review. In so arguing, the exporter said this standard of review doesn't cut against the trade court's ruling in another case involving a UFLPA Entity List addition, Ninestar v. U.S., nor does it conflict with Section 307, which bars the import of goods made with forced labor, or the "purpose of the UFLPA."

In Ninestar, CIT applied a "reasonable cause to believe" standard to UFLPA listing decisions. Camel said its case is distinguishable from Ninestar, since the company's case concerns a "removal decision" and not a listing decision. Where a statute is silent on the standard of review for agency decisions issued under its authority, the Administrative Procedure Act compels a "preponderance of the evidence" standard, the brief argued. Removal decisions, unlike listing decisions, involve a "complete administrative adjudicative process where evidence and arguments are submitted, and a hearing is held," prompting a preponderance standard, the company argued.

Camel added that a "preponderance" standard for removal decisions avoids the "illogical symmetry" where the government can more easily obtain an embargo on certain products under Section 307 than under the UFLPA. The company said this would be illogical, since the UFLPA was meant to support action under Section 307, adding that listing decisions under the UFLPA, like Section 307 withhold release order embargoes, are still subject to a "reasonable cause" burden of proof.

Regarding the congressional goals of UFLPA, Camel cited statements from the various representatives who championed the legislation, noting Congress' intent behind the bill was "to combat the lack of transparency by the Chinese government in XUAR and promote awareness for consumers." A "preponderance" standard doesn't conflict with these goals, since FLETF's "ability at the listing stage would not be impaired," the brief said.

Camel's motion for judgment also included a lengthy and often redacted discussion of the evidence and procedure at issue. Central to the exporter's case is its claim that FLETF failed to follow the UFLPA statute, since it never found Camel transferred individuals "out of XUAR," which is an explicit statutory requirement. FLETF doesn't even try to claim Camel transferred anyone "out of XUAR," instead focusing solely on alleged recruitment in Toksun County, a region in XUAR, for Camel's Xinjiang affiliates, the brief said.

The company said that FLETF rested its determination on allegations found in three reports released by Sheffield Hallam University that Camel took part in a XUAR government-sponsored labor transfer program around July 2017. In addition, FLETF relied on a WeChat article on the program that cited Camel Group as one of its participants.

Camel argued that FLETF's interpretation of this evidence, "ignores contradictory evidence, relies on its own assumptions, and rests on a misinterpretation of the evidence" found in the confidential administrative record. The company said the task force had contradictory information in its possession even before the removal petition was filed, since the Sheffield Hallam University reports contained photos the reports "wrongly claimed showed Camel" taking part in the labor transfer program. "Even FLETF admitted that the photos in the SHU Reports do not show any Camel participant," the brief said.

FLETF also "ignored and summarily dismissed" Camel's contradictory evidence, including sworn affidavits from a Camel employee and former general manager for Camel's Xinjiang affiliates confirming Camel declined to take part in the labor transfer program when asked by the local government, the brief said. And while FLETF questioned why "no contemporaneous written records were made" after the local Xinjiang government reached out about participation in the program, Camel said this isn't a "serious consideration of Camel's evidence," since there's no reasonable implication that "Camel should have been aware that 5 years in the future, the U.S. would pass a law specifically concerning forced labor in XUAR."

Camel also accused FLETF of violating its due process rights, since the task force failed to disclose and explain its conflict of interest with DHS employee Dr. Laura Murphy. The exporter said Murphy is the lead author of the SHU reports that FLETF admittedly relied on in its removal decision. Yet, DHS hired Murphy as a policy adviser "only three days after Camel submitted its Removal Petition."

The brief said Camel's concerned that Murphy "improperly influenced FLETF’s Removal Decision and that FLETF gave undue weight to her participation, without considering that her previous work may prejudice her influence in the removal process."