The de minimis trade loophole has been a significant issue for the United States, particularly in recent years as online retailers from China have gained popularity among American consumers. This provision allowed shipments worth less than $800 to enter the U.S. duty-free, which led to an influx of packages from Chinese e-commerce companies like Temu and Shein that offer low-cost apparel, electronics, and other items. The Trump administration had initially sought to close this loophole due to concerns about facilitating shipments of illicit substances such as fentanyl and the potential for counterfeit or unsafe goods entering the country.
President Donald Trump signed an executive order in February 2019, ending the de minimis trade exemption; however, he later reversed course and delayed its cancellation. The recent announcement by President Trump to shut down this loophole on May 2 comes alongside a set of sweeping new tariffs, giving customs officials, retailers, and logistics companies more time to prepare for these changes. Goods that qualify under the de minimis exemption will now be subject to either a duty of 30% of their value or $25 per item, with this rate increasing to $50 per item on June 1.
The use of the de minimis provision has seen significant growth in recent years as more consumers turn to Chinese e-commerce companies for affordable products. However, critics argue that it provides an unfair advantage to these companies and raises concerns about counterfeit goods entering the country with minimal documentation or inspection. As a result, U.S. Customs and Border Protection processed over 1.3 billion de minimis shipments in 2024 alone – up from over 1 billion shipments just one year prior.
In response to increased scrutiny of this loophole, Temu and Shein have taken steps to expand their operations within the U.S., onboarding sellers with inventory stored in American warehouses. This move suggests that these companies are adapting to changing regulations while still seeking to capitalize on the popularity of low-cost online shopping among American consumers.
Overall, the closure of the de minimis trade loophole represents a significant shift in U.S.-China trade relations and highlights ongoing concerns about counterfeit goods entering the country through these types of shipments. As customs officials, retailers, and logistics companies prepare for these changes, it remains to be seen how this will impact consumer behavior and online shopping trends moving forward.
[Original Article](https://www.nbcnews.com/news/world/de-minimis-trade-loophole-boosted-chinese-online-retailers-end-may-2-rcna199425) #minimis #trade [Visit GhostAI](https://ghostai.pro/)
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