How Can Foreign - Trade Enterprises Avoid Risks and Break Through with the Tightening of US Trade Policies?

The current global trade landscape is changing rapidly. The frequent adjustments of the US governments import policies, especially the tightening of the de minimis exemption policy and the increase of tariffs, haveforeign tradeposed greater challenges to enterprises. How can enterprises turn the situation around against the wind in such an environment? How to accurately interpret policies, avoid risks, and ensure business stability?

Background of the De Minimis Exemption Policy

The de minimis exemptionis a policy of the US Customs that allows goods worth $800 or less to enter the US duty - free and with little scrutiny. This policy was originally designed to facilitate individual consumers, reducing the burden of customs clearance when shopping overseas or bringing back souvenirs from travel.

Emergence of the Problem

However, in 2023, the number of packages entering the US through the de minimis exemption exceeded 1 billion, with nearly 4 million packages entering the US daily on average, reaching a record high. Most of these packages came from Chinese e - commerce platforms such as Temu and Shein. According to a report by the US House of Representatives Committee, the packages of these two companies accounted for about one - third of the total.

Concerns of the US Government

The US government believes that the surge in small packages makes it easier for illegal or unsafe goods to enter the US through this channel, including products with safety defects, goods produced using forced labor, and even a means of drug trafficking (such as fentanyl).

Deputy National Security Advisor Daleep Singh said, The sharp increase in de minimis imports makes it increasingly difficult to combat and prevent illegal or unsafe goods from entering the US through this channel.,

Proposed Policy Adjustments

To address this issue, the Biden administration plans to issue a Notice of Proposed Rulemaking (NPR) to exclude the following goods from the de minimis exemption:

• Products subject to tariffs under Section 201 or 301 of the Trade Act of 1974
• Products subject to tariffs under Section 232 of the Trade Expansion Act of 1962

Section 301 tariffs currently cover about 40% of US imports, including 70% of textile and clothing imports from China. If the new regulations are implemented, these goods will no longer enjoy the de minimis exemption and will be subject to corresponding tariffs.

Strengthen Information Transparency and Accountability

The Biden administration plans to increase the transparency and accountability of de minimis goods, including:

• Requiring more goods information: such as 10 - digit tariff classification numbers and information of the person applying for the de minimis exemption.
• Clarifying exemption eligibility: The proposed regulatory rules will clarify who is eligible for the exemption to prevent abuse.

Strengthen Law Enforcement

• Intervention of the Consumer Product Safety Commission (CPSC): The CPSC plans to require consumer product importers to electronically submit a Certificate of Conformity (CoC) to the US Customs and the CPSC, including for de minimis goods, to prevent unsafe products from entering the market.
• Combating illegal imports: Strengthen the inspection of small packages, focus on cracking down on illegal textile and clothing imports, and increase customs audits and foreign verifications.

Tariff Adjustments

The Office of the United States Trade Representative (USTR) issued the final action rules for imposing tariffs on China on September 13 after a four - year review:

Starting from September 27, 2024:
• The tariff on Chinese electric vehicles will be increased to 100%
•solarThe tariff on batteries will be increased to 50%
• The tariffs on key minerals such as steel, aluminum, and masks will be increased to 25%

Starting from January 1, 2025:
• The import tariff on Chinese semiconductors will be increased by 50%, with new categories of polysilicon and silicon wafers added

Starting from 2026:
• The tariff on medical masks will be increased to 50%
• The tariff on medical gloves will be increased from 25% in 2025 to 100% in 2026
• The tariffs on laptops and mobile phones will be increased

Retention of Existing Tariff Measures

The Biden administration has retained the tariffs imposed on more than $300 billion worth of Chinese goods during the Trump era, with rates ranging from 7.5% to 25%, covering toys, T - shirts, internet routers, and industrial machinery, etc.

Increase in Costs

• Tariff increase: Importers need to pay higher tariffs, directly leading to an increase in product costs and a reduction in profit margins.
• Prolonged customs clearance time: More inspections and data requirements may lead to longer customs clearance times, affecting the delivery cycle.

Increase in Compliance Risks

• Information disclosure requirements: Enterprises need to provide more detailed goods information, increasing the complexity and cost of compliance work.
• Strengthened law enforcement: Violations may face high - value fines or even legal proceedings, so enterprises need to be more cautious.

Increased market uncertainty

• Frequent policy changes: The uncertainty of trade policies increases market risks and affects the strategic planning of enterprises.

Strengthen compliance management

• Update policy information in a timely manner: Pay close attention to the latest developments of US trade regulations to ensure understanding of policy changes in a timely manner.
• Improve the internal compliance system: Establish a dedicated compliance department or position responsible for compliance review and risk control.
• Train employees: Raise the compliance awareness of all employees to ensure that operational processes comply with regulations.

Optimize the supply chain

• Diversify the market layout: Explore other international markets to reduce dependence on the US market.
• Adjust the supply chain structure: Consider setting up production bases in other countries to avoid high - tariff areas.

Seek professional support

• Foreign trade agency services: Leverage professional foreign trade import and export services to obtain the latest policy interpretations and compliance support, and reduce operational risks.Export Representation• Legal consultation: Hire legal advisors familiar with international trade regulations to provide professional legal advice.
Actively communicate with regulatory authorities

• Take the initiative in information disclosure: Provide the required information in a timely and accurate manner as required to establish a good compliance image.

• Participate in policy discussions: Express corporate demands and influence policy - making through channels such as industry associations.
Facing the complex and changing international trade environment, customers who need foreign trade import and export agency services should actively adapt to changes and improve their compliance levels and risk control capabilities. By strengthening compliance management, optimizing the supply chain, and seeking professional support, enterprises can seek opportunities in challenges and achieve stable development.

We suggest that you:

• Maintain policy sensitivity:

Regularly pay attention to changes in trade policies and make contingency plans.• Strengthen internal management:
Improve the level of compliance and risk management to ensure the stable operation of the business.• Leverage professional strength:
Cooperate with professional foreign trade agencies and legal teams to enhance competitiveness.If you need to further understand trade risk compliance measures or seek professional foreign trade import and export agency services, please feel free to contact us.

We will wholeheartedly provide you with comprehensive support to help your business thrive in the global market.ZhongShen International TradeIn - depth analysis of the EUs New Battery Law: How should battery - exporting enterprises respond?