White House pauses de minimis ban on Chinese e-commerce

President Donald Trump has delayed his ban on duty-free treatment of low-value shipments from China until border agencies can figure out how to collect and process single parcels without backing up the import clearance system.

The White House on Wednesday amended its recent executive order closing the duty exemption for de minimis shipments valued at $800 or less, but only publicly unveiled the new order on Friday.

“Duty-free de minimis treatment under [U.S. law] is available for otherwise eligible covered articles described in subsection (a) of this section, but shall cease to be available for such articles upon notification by the Secretary of Commerce to the President that adequate systems are in place to fully and expediently process and collect tariff revenue applicable pursuant to subsection (a) of this section for covered articles otherwise eligible for de minimis treatment,” the updated executive order said.

The change appears to be a response to massive industry confusion on how to immediately adapt to the rule change and some  buildup of packages at U.S. airport facilities. Since 2023, Chinese and U.S. marketplace sellers have rushed to take advantage of de minimis, which also requires limited customs documentation.

U.S. Customs and Border Protection is the primary agency that must operationalize enforcement of the de minimis shut down, but other agencies with jurisdiction over imports are also involved. 

The Trump administration without warning last weekend eliminated the exemption for de minimis along with imposing a 10% tariff on all Chinese goods, citing the need to stop smuggling of the dangerous opioid fentanyl and precursor chemicals. The move effectively made direct-to-consumer parcels subject to tariffs up to 38% when counting previous tariffs.

In response, the U.S. Postal Service on Tuesday suspended receiving all inbound packages from China. It reversed course the next day, saying it would accept packages while it works with CBP on procedures for collecting new China tariffs to ensure minimal disruption to package delivery.

The elimination of the de minimis benefit meant that inexpensive goods from China would have to go through the traditional formal entry process for imports, which requires more information and processing time in addition to duties and taxes.

Many trade professionals have warned that CBP would have difficulty enforcing restrictions on de minimis shipments without causing backlogs because it doesn’t have the personnel and equipment to process millions of packages a day through the formal, or informal, entry system.

The National Foreign Trade Council has argued that the cost to collect duties under tighter de minimis rules would be more than the revenue collected and that other types of cargo would face clearance delays because the short-staffed CBP would have to spend more time processing small packages.

Click here for more FreightWaves/American Shipper articles by Eric Kulisch.

Write to Eric Kulisch at ekulisch@freightwaves.com.

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