Panelists
- Ralph Carter, Staff Vice President, Regulatory Affairs, FedEx
- Kim Glas, President & CEO, National Council of Textile Organizations; Commissioner, U.S.-China Economic and Security Review Commission
- Melissa Irmen, Director of Advocacy, NAFTZ-National Association of Foreign-Trade Zones
- John Pickel, Senior Director, International Supply Chain Policy, National Foreign Trade Council
- Felicia Pullam, Executive Director, Office of Trade Relations, U.S. Customs and Border Protection
- Ana Swanson, Trade and International Economics Reporter, The New York Times (Moderator)
Event summary: Competing views about de minims and its reform
Arguments supporting De Minimis: Proponents like Ralph from FedEx argue that de minimis reduces trade friction, drives international supply chain efficiency, and allows U.S. companies to offer competitive pricing through free returns and streamlined customs processes. Meanwhile, they argue that the de minimis supports low-income U.S. consumers and enables small U.S. businesses to remain competitive.
Criticism of De Minimis: Critics, including Kim Glas from the National Council of Textile Organizations (NCTO), argue that it undercuts U.S. manufacturers, especially in industries like textiles, by allowing cheap imports from countries like China, often bypassing tariffs and safety regulations. They also say that de minimis was unfair to U.S. retailers that pay millions of dollars of tariff duties. Additionally, there are significant concerns about the safety risks posed by counterfeit goods and dangerous products (e.g., fentanyl) entering under de minimis exemptions.
Challenges of dealing with de Minimis: Felicia from the U.S. Customs and Border Protection (CBP) emphasizes the strain on the agency’s resources due to the sheer volume of de minimis shipments—it surged from about 2.8 million shipments per day in fiscal year 2023 to close to 4 million shipments per day in fiscal year 2024. She highlighted challenges such as the often unreliable information the de minimis imports submitted and the outdated authorities that hinder CBP’s enforcement.
Equal treatment for U.S. Foreign Trade Zones: U.S. Foreign Trade Zones (FTZs) are designated areas within the United States that are considered outside U.S. customs territory for import duties. They allow businesses to import, store, assemble, manufacture, or process goods with deferred or reduced customs duties, which are only paid when goods leave the FTZ and enter U.S. commerce. Currently, U.S. FTZs do not benefit from the de minimis exemption, meaning goods imported directly into the U.S. from overseas warehouses can qualify for de minimis, but goods entering through U.S. FTZs do not.
Melissa Irmen from NAFTZ-National Association of Foreign-Trade Zones advocates for U.S. foreign trade zones to be given the same de minimis privileges as foreign warehouses, arguing that this would ensure better oversight and security while maintaining trade efficiency. Critics, however, say that expanding de minimis in this way would exacerbate the problem rather than fix it.
Reforming the De minimis: There is a push for comprehensive reform of the De minimis system, with proposals ranging from raising duties on certain products to eliminating the exemption altogether for specific categories of goods (e.g., textiles, products subject to Section 301 tariffs).
Particularly, in a face sheet released in September 2024, the Biden Administration announced it would address “the significant increased abuse of the de minimis exemption, in particular China-founded e-commerce platforms.” The announcement said the Biden Administration would issue 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. The announcement also called for Congress to pass new legislation to reform the de minimis rule comprehensively.
Related readings:
- CBP De minimis 101 webinar
- FASH455 Exclusive Interview with the Office of Trade at U.S. Customs and Border Protection (CBP)
- FASH455 Discussion: De Minimis Rule and the US Textile and Apparel Industry
- International Trade and E-Commerce (CRS report, 2022)
FASH455 Global Apparel & Textile Trade and Sourcing 
The following information is generated by ChatGPT and is for consideration only:
When goods are imported into the U.S. under the de minimis provision (typically under Section 321 of the Tariff Act), fewer formalities and documentation are required compared to regular imports. Under the de minimis threshold, goods valued at $800 or less can enter the U.S. duty-free, subject to certain exclusions. Here’s a breakdown of the specific information that is typically not required when importing under de minimis:
Formal Entry Documentation: There is no need to file a formal entry with U.S. Customs and Border Protection (CBP), which means the detailed customs declaration (CBP Form 7501) and entry summary are not required.
Payment of Duties: Since de minimis shipments are duty-free, importers are not required to calculate or pay customs duties, taxes, or fees.
Harmonized Tariff Schedule (HTS) Classification: While a general description of the product is still needed, a precise HTS code is not mandatory for de minimis shipments.
Bond Requirements: Importers are not required to post a customs bond, which is normally necessary for higher-value imports.
Importer Security Filing (ISF): This is typically required for ocean freight, but de minimis shipments, especially by air or express carriers, are exempt.
Additional Documentation: Other documents like commercial invoices, certificates of origin, and product testing certificates may not be required, unless the product falls under specific regulatory requirements (such as food, pharmaceuticals, or certain textiles).
While I do understand that de minims does undercut American businesses as Kim Glas said, I think it’s important to keep de minims in place because of the positives. Helping small businesses remain competitive is so important to keep our economy functioning. Keeping de minims will also help low income Americans with their needs. Perhaps a reform would be necessary to help out manufacturers but to me the concept remains necessary. It doesn’t make sense to put tariffs on products and orders that are so low cost. People are less likely to buy smaller orders if they will have to pay the same tariff regardless, which would leave many small businesses and individuals stranded in the US.
I see both sides of the debate around de minimis but I think keeping it in place is pivotal. While it’s true that large platforms can exploit this policy it also plays a big role in helping small businesses going and being competitive. It also helps on keeping costs down for everyday Americans. Removing or significantly altering it might create more harm than good especially for people who depend on affordable imports for personal or business needs. Instead of removing de minimis altogether I think that reforming it to focus on higher value or high risk shipments could address the concerns raised without negatively affecting smaller players like small businesses. All in all it doesn’t make sense to heavily regulate the lower cost shipments when they provide such a meaningful benefit to so many different businesses.
This discussion on de minimis is an important debate discussing balancing trade efficiency and protecting U.S. manufacturers. While de minimis helps small businesses compete and keeps costs lower for consumers, reforms are needed to address valid concerns. These include safety risks and unfair advantages for larger foreign businesses. I agree with the idea of reforming de minimis rather than eliminating it all together. It plays a crucial role in supporting small businesses and low-income Americans and should still remain in use. Targeting reforms toward higher-value or risky shipments could address issues like counterfeit goods and tariff evasion while maintaining the benefits for smaller businesses.