China Launches Probe into PVH Group Over Xinjiang Supply Chain #

China’s Ministry of Commerce announced on Tuesday the launch of an investigation into PVH Group, the parent company of Calvin Klein, regarding alleged business disruptions in its Xinjiang supply chain.

The probe is part of China’s ‘unreliable entities’ list mechanism, which is similar to the U.S. Commerce Department’s entity list that restricts companies from accessing U.S.-originated items.

The investigation alleges that PVH targeted Xinjiang suppliers, violating normal market transaction principles and disrupting normal business operations with Chinese entities. The U.S. retail group has been given 30 days to respond to the allegations.

This move comes amid ongoing scrutiny of foreign retail companies in China over their efforts to distance themselves from alleged forced labor issues in the Xinjiang region. PVH, which also owns Tommy Hilfiger, has previously stated that Xinjiang is one of the regions where no direct or indirect sourcing is permitted.

The probe coincides with recent U.S. actions, including plans announced by the U.S. Commerce Department to ban the import or sale of cars with specific hardware or software linked to China or Russia.

PVH’s international revenue, which accounts for more than half of its total revenue, has recently faced challenges in the Asia Pacific region, particularly in China and Australia.

The Xinjiang region, home to the Uyghur Muslims, has been a point of contention between China and several Western countries. While some nations and organizations have raised concerns about human rights issues in the region, China has consistently denied allegations of forced labor and other abuses, stating that facilities in question are vocational training centers.