E-commerce shopping sites expose gaps in modern slavery legislation

E-commerce shopping platforms sell billions of dollars in products in Australia, with Temu estimated to earn $2.6billion in Australian revenue in the last year. Concerns have been raised about how Australia’s tax and regulatory regime applies to such businesses. For the Australian Anti-Slavery Commissioner, these concerns extend to gaps in Australia’s laws aimed at fighting modern slavery.

The Modern Slavery Act 2018 (Cth) requires large companies that carry on business in Australia to report annually on how they assess and address risks of modern slavery. The Australian Government’s Modern Slavery Registry contains no record of any modern slavery statements submitted for Temu, or for its parent company PDD Holdings or related company WhaleCo Inc.

The Australian Anti-Slavery Commissioner, Chris Evans, said: “I’m concerned that some very large foreign companies, supplying a large number and variety of products direct to Australian customers, appear not to be reporting or are not required to report under the Modern Slavery Act. This suggests a major gap in the reach of the legislation.”

The Commissioner has highlighted the need for a level playing field for Australian retailers taking action on modern slavery, saying: “Australian businesses making genuine efforts to address modern slavery in their supply chains and to comply with their reporting requirements, risk being undercut by businesses that operate outside these regimes.”

This concern is heightened by reports from NGOs and a US congressional inquiry on the specific risks of forced labour in the supply chains of Temu and similar businesses. The US inquiry found that Temu’s lack of basic action to prevent forced labour in its supply chains “all but guarantees that shipments from Temu containing products made with forced labor are entering the United States on a regular basis”

These regulatory gaps also highlight Australia’s lack of visibility and control over goods entering Australia that carry high risk of being made with forced labour. In contrast, the US, Canada and Mexico have controls on the import of goods made with forced labour, and the EU’s controls will commence in 2027. Commissioner Evans noted recent commitments from the Malaysian, Indonesian and Cambodian governments to introduce forced labour import bans, and said:

“While other governments around the world are committing to stop goods made with forced labour from entering their markets, Australia currently has no way of systematically identifying or stopping these goods. As more countries take action, we risk becoming a dumping ground.”