BTA Supports Labor Act, Discusses Implications of Ninestar Ban

Exploring the ripple effects of forced labor prevention and its impact on the business technology landscape

The Business Technology Association (BTA) has expressed support for the Uyghur Forced Labor Prevention Act (UFLPA), affirming that any product produced through forced labor should be removed from industry use. This statement came in response to the US Department of Homeland Security’s ban on importing goods produced by Ninestar Corporation and eight of its subsidiaries, based in Zhuhai, China, amid concerns over forced labor practices. BTA is currently seeking to understand the breadth of the ban and the specific products affected. Notably, the ban does not apply to Ninestar’s global operations beyond the Zhuhai region.

Notice to Ninestar that the conduct cited by the Forced Labor Enforcement Task Force (FLETF) is contrary to the high standards of BTA and violation has resulted in a motion to remove Ninestar as a BTA member. Consistent with due process, Ninestar must respond on or before Aug. 4, 2023.

BTA, July 2023

Ninestar, which owns a 63.04% stake in Lexmark and has extended financial support to the company, issued a statement asserting adherence to international labor protection standards. It’s worth noting that while Ninestar is the majority owner, Lexmark’s investors do not hold operational control over the company.

The ban’s implications have affected not just Lexmark, but also other manufacturers that incorporate Ninestar components in their products, igniting a scramble for alternative sources. Several suppliers confirmed to the BTA that they were discontinuing the use of Ninestar products and actively seeking replacements, thus adding a layer of uncertainty until new sources are identified.

In response, the BTA has engaged in ongoing dialogues with the FLETF to ascertain the full scope of the Ninestar ban, particularly whether Lexmark or its products are (or should be) included. BTA has also notified Ninestar of its non-compliance with the association’s high standards, triggering a motion to remove Ninestar as a BTA member, pending a response from the company by August 4, 2023. Further, BTA is in discussions with other suppliers to gauge the impact of the ban and their countermeasures.

Highlighting the relevance and urgency of the issue, BTA’s 2023 National Conference in Boston, Massachusetts, will feature a discussion titled “Will Slave Labor Disrupt the Supply Chain?” Moderated by BTA General Counsel Bob Goldberg, the panel will convene leading industry executives to address current developments and future projections related to the Ninestar embargo and its potential ripple effects on other OEMs that rely on Chinese-made components and supplies.

Press release, here.

– Greg Walters, Head Writer