Biden administration announces de minimis crackdown

The Biden administration proposed several new policies Friday with the goal of curtailing the abuse of the de minimis rules, action long advocated by many in the textile industry.

Current de minimis rules allow any package valued at under $800 to enter the United States with little to no scrutiny. An estimated 3 million packages a day come into the country under the existing rules. Many of these packages contain apparel from Chinese firms and opponents argue that they are being used to skirt rules around tariffs and the Uyghur Forced Labor Prevention Act (UFLPA).

The administration announced three actions Friday:

• A Notice of Proposed Rulemaking that would exclude from the de minimis exemption all shipments containing products covered by tariffs imposed under Sections 201 or 301 of the Trade Act of 1974, or Section 232 of the Trade Expansion Act of 1962. Section 301 tariffs currently cover approximately 40% of U.S. imports, including 70% of textile and apparel imports from China. 
• A Notice of Proposed Rulemaking regarding the entry of low-value shipments that will propose to strengthen information collection requirements to promote greater visibility into de minimis shipments. This would require specific, additional data for de minimis shipments – including the 10-digit tariff classification number and the person claiming the de minimis exemption – which will improve targeting of de minimis shipments and facilitate expedited clearance of lawful de minimis shipments. This is designed to help U.S. Customs and Border Protection (CBP) protect consumers from goods that do not meet regulatory health and safety standards and protect U.S. businesses from unfair competition against imported goods that would otherwise be charged duties or restricted from entry. 
• Consumer Product Safety Commission (CPSC) staff intend to propose a final rule requiring importers of consumer products to file Certificates of Compliance (CoC) electronically with CBP and CPSC at the time of entry, including for de minimis shipments. This regulation would strengthen CBP’s and CPSC’s ability to target and block unsafe products from entering the U.S. market

The administration also called on Congress to take action on de minimis, such as excluding textile and apparel products from the de minimis exception. A bipartisan group of senators introduced the Import Security and Fairness Act in June with the goal of addressing the de minimis loophole. The bill was referred to the Senate Finance Committee in June, but no further action has been taken.

Also Friday, the administration said it was considering other action to support the U.S. textile industry. These include exploring ways to increase procurement of certain U.S. textile and apparel products across agencies and prioritizing enforcement efforts against illicit textile and apparel imports through intensified targeting of small package shipments, joint trade special operations, increased customs audits and foreign verifications, and the expansion of the UFLPA Entity List.