Decision overturned. ‘Watershed’ ruling confirms that UK companies trading in forced labour goods risk prosecution

A 2023 High Court ruling was today successfully overturned. 

27.06.24: Global Legal Action Network (GLAN) and the World Uyghur Congress (WUC) have won in the Court of Appeal, which ruled that the UK National Crime Agency’s (NCA) refusal to investigate Uyghur forced labour cotton imported from China was unlawful.  

This landmark win will have massive consequences for high street retail giants trading and importing forced labour goods, confirming they are now exposed to legal risk. If a company knowingly or with suspicion imports goods which have been made in criminal circumstances - such as through forced Uyghur labour - they could be prosecuted under the Proceeds of Crime Act for trading criminal property 

This is the first case in the world involving Uyghur forced labour to successfully disrupt supply chains which are complicit in the ongoing genocide of Uyghur and other Turkic peoples in East Turkestan / Xinjiang, China. Companies must now clean up their supply chains or risk prosecution. 

A press conference will be held at 4pm today – details below. 

Our case challenged the failure of UK’s National Crime Agency (NCA) to investigate companies suspected of importing and trading in forced labour cotton. Today’s ruling declared the NCA’s refusal to investigate as unlawful and requires the UK authority to remake its decision. GLAN and WUC expect that this new decision will lead to full investigation into imports from the Uyghur region, and a commitment from the NCA to stopping tainted goods entering UK markets. 

The Court of Appeal rejected the NCA’s argument that once “adequate consideration” (i.e. market value) is paid for criminal property, the property is cleansed of its criminal character and is free to be bought and sold without consequence. Instead, the Court determined that while a purchaser is protected when they pay adequate consideration for criminal property, as soon as they transfer that property they are exposed to criminal liability. This means criminal property can be bought but not passed on.  

The majority of Chinese cotton sold by high street retailers is implicated in forced labour and this ruling is a major step towards ridding the UK high street of the proceeds of crime. Consumers unwittingly buying clothes and goods from cotton produced as part of ongoing atrocity crimes have the right to expect that tainted cotton should no longer reach high street stores. 

The Court of Appeal further determined that the NCA had made an error of law in stating that a specific consignment of forced labour cotton needed to be identified in order to commence an investigation. 

This decision is important for the Uyghur people’s fight to end complicity in the ongoing mass detainment and repression by the Chinese government and serves as a warning to those companies involved in forced labour supply chains that they risk being prosecuted for money laundering or having their criminal products confiscated.   

From the outset, this litigation has been significant due to the government and the court’s ready acceptance that forced labour is occurring in China and that goods produced in these circumstances amount to the proceeds of crime under UK law. This was reiterated by the Court of Appeal, which noted that the lower court had identified “a “striking consensus” as to the clear and widespread exploitation and abuses in that industry involving forced labour, and that forced labour accounts for a significant proportion of all cotton originating from China”. 

The Chinese detention program is the largest of its kind since World War II, aiming to destroy the Uyghur identity and unique culture. Well-documented evidence has proven that detainees are subjected to torture, sexual violence, deprivation of necessities, forced medical experimentation, and forced labour. An independent tribunal led by Sir Geoffrey Nice KC declared it as genocide and crimes against humanity, while the UN concluded it could constitute possible crimes against humanity. UK MPs and several countries, including the US, Canada and the Netherlands have declared this programme to be genocide and accused China of crimes against humanity. Millions of Uyghurs are now detained and forced to produce cotton which evidence suggests ends up in UK high street stores such as Uniqlo and Zara. The UK authorities could determine this as part of an investigation but have refused.     

Dearbhla Minogue, GLAN Senior Lawyer said, “This litigation has been critical in recognising the mass atrocities being committed against Uyghur and other Turkic Muslim people by the Chinese government, and holding to account those complicit in, or profiting from, these crimes. There is an abundance of evidence that UK companies are importing forced labour cotton from China. Following this ruling, we expect the National Crime Agency will investigate and prosecute where appropriate to prevent forced labour cotton from flooding the UK market.” 

Leanna Burnard, GLAN lawyer said, “This judgement is a watershed moment for supply chains profiting from forced labour and other crimes. Where companies know or suspect they are trading the proceeds of crime, they will themselves be committing a crime whenever they transfer those goods. We hope this will mark the end of the UK market being used to launder the profits of mass atrocities, and that UK high street shoppers can expect that their purchases will no longer support the suffering of others.” 

Alice Hardy, Partner at Bindmans LLP said “The government accepted at the outset of this case that forced labour is being used in China and goods that are the product of that labour are the proceeds of crime. It is fantastic that the Court of Appeal have recognised the need for an effective mechanism to investigate those crimes and confirmed that the National Crime Agency was wrong to take the view that a consignment of cotton must be identified as criminal proceeds before an investigation could commence was wrong.” 

Rahima Mahmut UK Director, World Uyghur Congress said, “This is a monumental victory and a moral triumph. For far too long, there has been no international court to hold China accountable. The UK government's lack of action forced us to pursue this case, and it is incredibly heartening to see the judges' findings support our arguments. Our fight has not only been against genocide but also against the forced labour imposed on countless Uyghurs in East Turkestan under the suffocating CCP regime. This win represents a measure of justice for those Uyghurs and other Turkic people who have been tortured and subjected to slave labour there. We are deeply grateful to the judges who sided with us and to the brilliant lawyers from GLAN and Bindmans LLP who worked diligently on this case. Now, we urgently call on the government to implement tougher legislation.” 

Dr Gearóid Ó Cuinn, Director of GLAN said, “The landmark judgement is not only significant for the UK, it sends a message to other countries which allow the importation of Uyghur cotton and other atrocity crime goods. They ought to address retailers operating in their markets who are trading in and profiting from these proceeds of crime.” 

WUC is represented by Dearbhla Minogue and Leanna Burnard of GLAN and Bindmans LLP, Alice Hardy of Bindmans LLP, Jonathan Fisher KC, Tom Forster KC, and Anita Clifford of Red Lion Chambers, Russell Hopkins of Temple Garden Chambers, and Admas Habteslasie of Landmark Chambers.   

Ends  

Notes to editors:   

GLAN lawyers and WUC representatives are available for interview or further comment.   

Global Legal Action Network (GLAN) is an independent organisation made up of legal practitioners, investigative journalists and academics. We identify and pursue legal actions that promote accountability for human rights violations occurring overseas by working in partnership with other international and local grassroots organisations. GLAN provides the necessary platform to explore and develop legal strategies by combining legal and investigatory expertise. glanlaw.org     

Contact: cbaker@glanlaw.org  

The World Uyghur Congress (WUC) is an international organisation that represents the collective interest of the Uyghur people both in East Turkistan and abroad. The WUC was established on 16 April 2004 in Munich, Germany, after the East Turkistan National Congress and the World Uyghur Youth Congress merged into one united organisation. The main objective of WUC is to promote the right of the Uyghur people to use peaceful, nonviolent, and democratic means to determine the political future of East Turkistan. www.uyghurcongress.org