Frequently Asked Questions (FAQs) - SB 657

No. The Act, codified at California Civil Code section 1714.43, sets forth three qualifications for those companies subject to the law. The company must:

1. Identify itself as a retail seller or manufacturer on its California state tax returns.
2. Do business in the state of California, as defined by Revenue and Taxation Code section 23101.
3. Have annual worldwide gross receipts that exceed one hundred million dollars.

The Act requires covered retail sellers and manufacturers to post disclosures – applicable to five specific categories – about their efforts to eradicate slavery and human trafficking from their product supply chains. (Cal. Civ. Code, § 1714.43.)

As to each, the entity must at a minimum “disclose to what extent, if any,” it engages in efforts related to verification, auditing, certification, accountability, and training. Importantly, even if a covered company does not engage in any such efforts, the company must post disclosures to this effect as to each category.

If a company has a website, the required disclosure must be accessible through a “conspicuous and easily understood link” on the company’s homepage. To be most effective and avoid confusing or losing the viewer, the link should go directly to the disclosure page, without requiring the consumer to click multiple links to access the information.

Covered companies without websites must provide a written disclosure within 30 days of receiving a written consumer request. The written disclosure must satisfy the same requirements as the web-based disclosure.

As to each, a covered company must at a minimum “disclose to what extent, if any,” it does the following:

1. Verification. Engages in verification of product supply chains to evaluate and address risks of human trafficking and slavery. The disclosure shall specify if the verification was not conducted by a third party.
2. Audits. Conducts audits of suppliers to evaluate supplier compliance with company standards for trafficking and slavery in supply chains. The disclosure shall specify if the verification was not an independent, unannounced audit.
3. Certifications. Requires direct suppliers to certify that materials incorporated into the product comply with the laws regarding slavery and human trafficking of the country or countries in which they are doing business.
4. Accountability. Maintains internal accountability standards and procedures for employees or contractors failing to meet company standards regarding slavery and trafficking.
5. Training. Provides company employees and management, who have direct responsibility for supply chain management, training on human trafficking and slavery, particularly with respect to mitigating risks within the supply chains of products.

The Attorney General has the exclusive jurisdictional authority to bring an action for injunctive relief for a violation of this law.

The Attorney General has created an email account to accept inquiries and reports related to the California Transparency in Supply Chains Act. Please direct any such inquiries or reports to SB657@doj.ca.gov.

Yes, the California Department of Justice has issued an informational Resource Guide containing recommendations for companies to consider in complying with the Transparency in Supply Chains Act and model disclosures inspired by real-world company disclosures. The guide is not a set of regulations, mandates, legal opinions, or legal advice, and it will not create any enforceable rights. The model disclosures are examples of best practices, but the resource guide does not exhaust the full range of possible disclosure options and discretion that covered companies have in complying with the Act. Because the Resource Guide is not be a substitute for the law, a person or entity with questions about the Act’s requirements should consult the statute.

Please seek out help immediately by calling the National Human Trafficking Resource Center Hotline at 1-888-373-7888 or the U.S. Department of Justice Hotline at 1-888-428-7581. For more information, please visit the Attorney General's Human Trafficking page.