KUALA LUMPUR: The government is actively addressing the regulatory "gap" highlighted in the Office of the United States Trade Representative's (USTR) report, says the Investment, Trade and Industry Ministry.
It also emphasised that Malaysia has a comprehensive domestic legal framework prohibiting forced labour, which is rigorously enforced by the relevant authorities.
"USTR's finding does not mean Malaysia practises forced labour and is not a reflection of labour conditions in Malaysia. What the report found is that Malaysia does not yet have a specific import prohibition law to screen goods and raw materials entering the country from third countries with forced labour content and the government is actively working to address this import gap," the ministry said in a statement on Thursday (June 4).
The ministry noted that the USTR initiated two investigations against Malaysia on March 11 and 12, relating to excess capacity and the failure to address the importation of goods containing forced labour content, respectively. In response, Malaysia submitted its formal comments on April 15, 2026 and appeared before the USTR on May 12, 2026.
On June 2, 2026, the USTR published its findings under the Section 301 investigation on forced labour involving Malaysia and proposed a 10% tariff on Malaysian goods upon the expiry of the tariff imposed under Section 122 of the Trade Act 1974 on July 24, 2026.
The ministry noted that no final tariff determination has been made against Malaysia, as the proposed 10% tariff remains subject to the USTR's investigation process and formal determination.
Requests to appear at the hearings, together with a summary of testimony, must be submitted by June 22, 2026, while written comments are due by July 6, 2026. Public hearings are scheduled for July 7, 2026.
A final decision is expected in late July 2026, around the expiry of the Section 122 temporary tariff on July 24, 2026, with the Section 301 tariffs intended to take effect thereafter.
Malaysia will continue engaging with the USTR throughout the process, including at the hearings, to present its case and protect national trade interests. – Bernama
