101ST GENERAL ASSEMBLY
State of Illinois
2019 and 2020
SB3623

 

Introduced 2/14/2020, by Sen. Jacqueline Y. Collins

 

SYNOPSIS AS INTRODUCED:
 
New Act

    Creates the Business Supply Chain Transparency for Slavery, Trafficking, and Child Labor Act. Provides that every retail seller and manufacturer doing business in the State and having annual worldwide gross receipts that exceed $100,000,000 shall disclose its efforts to eradicate slavery, human trafficking, and child labor from its direct supply chain for tangible goods offered for sale. Provides requirements and process for disclosures. Provides that the Department of Revenue shall make available to the Attorney General a list of retail sellers and manufacturers required to disclose efforts to eradicate slavery, human trafficking, and child labor pursuant to the Act. Provides that the list shall be based on tax returns filed for taxable years beginning on or after January 1, 2021 and shall be submitted annually to the Attorney General by November 30, 2021, and each November 30 thereafter. Provides that the list shall be derived from original tax returns received by the Department on or before December 31, 2020, and each December 31 thereafter. Effective January 1, 2021.


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A BILL FOR

 

SB3623LRB101 14940 TAE 63947 b

1    AN ACT concerning business.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 1. Short title. This Act may be cited as the
5Business Supply Chain Transparency for Slavery, Trafficking,
6and Child Labor Act.
 
7    Section 5. Findings. The General Assembly finds and
8declares that:
9        (1) Modern slavery, human trafficking, and child labor
10    are crimes under State, federal, and international law but
11    still continue to exist, including in the State of
12    Illinois.
13        (2) These crimes are often hidden from view and are
14    difficult to uncover and track.
15        (3) Legislative efforts to address the market for goods
16    and products tainted by slavery, trafficking, and child
17    labor have been lacking.
18        (4) As of September 20, 2018, the List of Goods
19    Produced by Child Labor or Forced Labor, published by the
20    United States Department of Labor, comprised 148 goods from
21    76 countries.
22        (5) Consumers and businesses are inadvertently
23    promoting and sanctioning these crimes through the

 

 

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1    purchase of goods and products that have been tainted in
2    the supply chain.
3        (6) Absent publicly available disclosures, consumers
4    are at a disadvantage in being able force the eradication
5    of slavery and trafficking by way of the market and their
6    purchasing decisions.
7        (7) It is the policy of this State to ensure large
8    retailers and manufacturers provide consumers with
9    information regarding their efforts to eradicate slavery,
10    human trafficking, and child labor from their supply
11    chains, to educate consumers on how to purchase goods
12    produced by companies that responsibly manage their supply
13    chains, and, thereby, to improve the lives of victims of
14    slavery, human trafficking, and child labor.
 
15    Section 10. Definitions. As used in this Act:
16    "Child labor" means work that is mentally, physically,
17socially, or morally dangerous and harmful to children and
18interferes with their schooling by depriving them of the
19opportunity to attend school; obliging them to leave school
20prematurely; or requiring them to attempt to combine school
21with excessively long and hard work conditions.
22    "Doing business in this State" means actively engaging in
23any transaction for the purpose of financial or pecuniary gain
24or profit.
25    "Gross receipts" means the sum of money and the fair market

 

 

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1value of other property or services received on the sale or
2exchange of property, the performance of services, or the use
3of property or capital (including rents, royalties, interest,
4and dividends) in a transaction that produced business income,
5in which the income, gain, or loss is recognized (or would be
6recognized if the transaction were in the United States) under
7the Internal Revenue Code. Gross receipts does not include:
8        (1) Repayment.
9        (2) The principal amount received under a repurchase
10    agreement or other transaction properly characterized as a
11    loan.
12        (3) Proceeds from the issuance of the taxpayer's own
13    stock or from sale of treasury stock.
14        (4) Damages and other amounts received as a result of
15    litigation.
16        (5) Property acquired by an agent on behalf of another.
17        (6) Tax refunds and other tax benefit recoveries.
18        (7) Pension reversions.
19        (8) Contributions to capital (except for the sale of
20    securities by a securities dealer).
21        (9) Income from the discharge of indebtedness.
22        (10) Amounts realized from exchanges of inventory that
23    are not recognized under the Internal Revenue Code.
24        (11) Amounts received from transactions in intangible
25    assets held in connection with a treasury function of the
26    taxpayer's unitary business and the gross receipts and

 

 

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1    overall net gains from the maturity, redemption, sale,
2    exchange, or other disposition of those intangible assets.
3        (12) Amounts received from hedging transactions
4    involving intangible assets.
5    "Hedging transaction" means a transaction related to the
6taxpayer's trading function involving futures and options
7transactions for the purpose of hedging price risk of the
8products or commodities consumer, produced, or sold by the
9taxpayer.
10    "Human trafficking" means a violation or attempted
11violation of subsection (d) of Section 10-9 of the Criminal
12Code of 2012.
13    "Manufacturer" means a business entity with manufacturing
14as its principal business activity.
15    "Retail seller" means a business entity with retail trade
16as its principal business activity.
17    "Slavery" means a violation or attempted violation of
18subsection (b) of Section 10-9 of the Criminal Code of 2012.
19    "Treasury function" means the pooling, management, and
20investment of intangible assets for the purpose of satisfying
21the cash flow needs of the taxpayer's trade or business, such
22as providing liquidity for a taxpayer's business cycle,
23providing a reserve for business contingencies, and business
24acquisitions, and also includes the use of futures contracts
25and options contracts to hedge foreign currency fluctuations. A
26taxpayer principally engaged in the trade or business of

 

 

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1purchasing and selling intangible assets of the type typically
2held in a taxpayer's treasury function, such as a registered
3broker-dealer, is not performing a treasury function with
4respect to income so produced.
 
5    Section 15. Retail and manufacturing.
6    (a) Every retail seller and manufacturer doing business in
7this State and having annual worldwide gross receipts that
8exceed $100,000,000 shall disclose its efforts to eradicate
9slavery, human trafficking, and child labor from its direct
10supply chain for tangible goods offered for sale.
11    (b) The disclosure shall be posted on the retail seller's
12or manufacturer's website with a conspicuous and easily
13understood link to the required information placed on the
14homepage of the business. If the retail seller or manufacturer
15does not have a website, the manufacturer shall provide the
16written disclosure within 30 days of receiving a written
17request for the disclosure from a consumer.
18    (c) The disclosure shall, at a minimum, disclose to what
19extent, if any, the retail seller or manufacturer does each of
20the following:
21        (1) Engages in the verification of product supply
22    chains to evaluate and address risks of slavery, human
23    trafficking, and child labor. The disclosure shall specify
24    if the verification was not conducted by a third party.
25        (2) Conducts audits of suppliers to evaluate supplier

 

 

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1    compliance with company standards for the elimination of
2    slavery, trafficking, and child labor in supply chains. The
3    disclosure shall specify if the audit was not an
4    independent, unannounced audit.
5        (3) Requires direct suppliers to certify that
6    materials incorporated into the product comply with the
7    laws regarding slavery and human trafficking of the country
8    or countries in which they are doing business.
9        (4) Maintains internal accountability standards and
10    procedures for employees or contractors failing to meet
11    company standards the elimination of regarding slavery,
12    human trafficking, and child labor.
13        (5) Provides company employees and management who have
14    direct responsibility for supply chain management training
15    on slavery, human trafficking, and child labor,
16    particularly with respect to mitigating risks within the
17    supply chains of products.
18    (d) The exclusive remedy for a violation of this Act shall
19be an action brought by the Attorney General for injunctive
20relief. Nothing in this Act shall limit remedies available for
21a violation of any other State or federal law.
 
22    Section 20. Companies subject to disclosure.
23    (a) Notwithstanding any provision of law, the Department of
24Revenue shall make available to the Attorney General a list of
25retail sellers and manufacturers required to disclose efforts

 

 

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1to eradicate slavery, human trafficking, and child labor
2pursuant to this Act.
3    (b) The list shall be based on tax returns filed for
4taxable years beginning on or after January 1, 2021.
5    (c) The list required by this Section shall be submitted
6annually to the Attorney General by November 30, 2021, and each
7November 30 thereafter. The list shall be derived from original
8tax returns received by the Department on or before December
931, 2020, and each December 31 thereafter.
10    (d) Each annual list required by this Section shall include
11the following information for each retail seller or
12manufacturer:
13        (1) entity name; and
14        (2) an Illinois tax identification number.
 
15    Section 99. Effective date. This Act takes effect January
161, 2021.