Canadian Firm Says Shanghai Factory Under Chinese Control During Period Prison Labour Reportedly Used

Prison labour infects Chinese supply chain, raising issues for foreign companies using Chinese manufacturers, warns expert
August 31, 2020 Updated: September 2, 2020

News Analysis

A Canadian company that makes medical masks says Chinese authorities took control of its facility in Shanghai for two months this year, while a Chinese state media article from that period reported that prisoners were producing masks at that factory at the time.

China has long been reported to use forced prison labour—not only performed by those imprisoned on criminal charges but also by prisoners of conscience—to produce products for distribution in the global supply chain.

According to a March 12 article by a media outlet controlled by Chinese state media Shanghai Daily, a “special group” of “offenders” in the Chinese prison labour system “volunteered” to make masks at a Canadian-owned AMD Medicom facility in Shanghai.

The Chinese article, which was first reported on by Blacklock’s Reporter last week, has since been taken down, but The Epoch Times has seen an archived version of it.

Montreal-based AMD Medicom holds a sole-sourced contract from the federal government to make masks amid the pandemic.

Gayle Padvaiskas, vice-president of marketing with Medicom, told The Epoch Times that during the period of Jan. 26 to March 27, which spans the time that the Chinese article was published, Medicom wasn’t under its own control.

“The Shanghai facility in question was appropriated by Chinese authorities from January 26 to March 27, 2020,” Padvaiskas said in an email.

“The Chinese government controlled all production and operations. Every mask made in the facility during that period was appropriated for domestic use in China.”

Padvaiskas added that none of the masks that were produced while the factory was under “Chinese control” were delivered to Canada.

Medicom received its contract, which a government memo values at $382 million, in April. A Globe and Mail report citing a source says the contract carries a firm $94 million value for the first three years, and the remainder would be negotiated in the future.

China’s Prison Labour

The topic of China’s use of prison labour has faced fresh scrutiny as it has come up recently in the House of Commons, as well as amid a clamp-down by U.S. officials on imports made with Chinese prison labour.

Officials from the Department of Public Services and Procurement told a House of Commons committee on July 23 that the government uses two steps to guard against the potential use of forced labour in imports coming to Canada.

One step is self-certification from the supplier, while the second step is reviewing the “charges against the country,” including reviewing “as much as possible their ethical supply chain.”

Conservative MP Kelly McCauley said he doesn’t think the current approach works to ensure prison labour isn’t used for imports to Canada from countries like China.

“It seems that there’s very little oversight, apart from trusting this despotic country to self-certify. It’s not breaking any laws in China to have forced labour,” McCauley said.

According to Fred Rocafort—a former U.S. diplomat who has worked in China as a commercial lawyer and has conducted audits to see if factories there use forced labour—forced labour is “something that has infected the supply chain in China.”

“If you’re a warden at a prison in China, you have access to labour, and you might be able to offer very competitive prices to … the China supplier,” Rocafort said in a previous interview.

He said international firms face considerable hurdles in getting access to accurate information about the labour practices of their suppliers and their suppliers’ suppliers.

“[A] lack of transparency runs across the supply chain,” he said.

US Scrutiny

In June, U.S. Customs and Border Protection seized 13 tons of human hair products from the northwestern region of Xinjiang, an area notorious for the suppression of Uyghurs and other Muslim minorities, who according to human rights organizations are subjected to forced labour.

Mounting evidence suggests that detainees such as Uyghurs, Falun Gong practitioners, and other prisoners of conscience are being exploited for forced labour in various detention facilities around China.

The conditions in these labour camps have received more attention in recent years with the phenomenon of “SOS notes”—notes hidden in products made by those labouring in the camps as a plea to the outside world for help.

One of the most well-known cases is a note found by Oregon woman Julie Keith in 2012 in Halloween decorations she had bought at Kmart. It was written by a Falun Gong practitioner named Sun Yi who was imprisoned for refusing to give up his faith, and his cry for help exposed the conditions of Masanjia Labour Camp—one of China’s most infamous.

Sun described dyeing Halloween decorations for so many hours a day that his hands continued the repetitive motions in his sleep.

Torture at Masanjia was routine, he said. Sun endured an extended period of intense torture, including being “hung up” from a bunk bed day and night for over a year and regularly shocked with electric batons.

When Keith sent Sun’s letter to local media it ignited a firestorm and set off a chain of events that would shut down the entire labour camp system in China; the camps were officially abolished in 2013. However, human rights observers say the regime still uses prisons, detention centres, mental health centres, and unofficial “black jails” for the very same purposes.

With reporting by Eva Fu and Cathy He

Note: This article was updated to reflect what is known about the funding received by Medicom from the federal government.