‘Comprehensive’ De Minimis Reform Bill Targets Apparel and Textile Products
A bipartisan group of Congressional lawmakers has introduced legislation aimed at reforming the de minimis trade provision to stop cheap and illicitly produced apparel and textile products from entering the American market.
Senators Ron Wyden (D-Ore.), Cynthia Lummis (R-Wyo.), Sherrod Brown (D-Ohio), Susan Collins (R-Maine) and Bob Casey (D-Pa.) on Thursday announced the Fighting Illicit Goods, Helping Trustworthy Importers, and Netting Gains (FIGHTING) for America Act, which they said would help empower Customs and Border Protection (CBP) to curb the influx of prohibited products—including counterfeits, items made with forced labor and goods that contain fentanyl.
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The proposed law’s central intention is to tighten the import requirements for low-value shipments, freezing out the most prolific offenders. Under the de minimis trade provision, foreign parcels worth $800 or less can enter the country duty free.
The FIGHTING Act would bar certain categories of products from using de minimis. The proposal specifically calls out those designated as “import-sensitive” under the Generalized System of Preferences (GSP)—most notably, textiles, apparel and leather goods.
Goods subject to anti-dumping or countervailing duties (AD/CVD), as well as those subject to tariffs resulting from a Section 301, Section 232, or Section 201 investigation would also be barred from entering the country, along with products that CBP has identified as “experiencing a surge” in de minimis activity or “presenting a persistent risk of illegal importation.”
Customs would be required to collect more data about the de minimis shipments they inspect in order to bolster their ability to intercept them. The law would streamline CBP procedures for seizing and disposing of these products, increase penalties for violators and establish a $2 per-shipment fee for the use of de minimis entry.
That’s a hefty sum, considering Shein and Temu are shipping a combined 600,000 packages into the country each day, according to House data. The lawmakers believe taking the actions laid out in the FIGHTING Act would effectively cut off Shein and Temu’s access to American consumers after quadrupling their volume of shipments into the U.S. in recent years.
“Foreign corporate giants are inundating our borders with millions of low-value packages, making it tough for customs agents to stop dangerous goods like fentanyl from falling into Americans’ hands,” Sen. Wyden said. “Americans should feel confident that anything arriving on their doorstep is safe, legal, and ethically produced. Our legislation would crack down on foreign companies abusing the law and make sure they play by the rules.”
“Chinese companies continue to abuse U.S. trade laws. It is necessary that we tighten customs oversight of low-value imports entering the United States to combat these abuses of tariff-free entry procedures,” Sen. Collins added. “This bipartisan bill would strengthen CBP enforcement, improve data collection, and streamline the import approval process to address unlawful imports and protect domestic industries while ensuring fair trade practices.”
Sen. Brown said the legislation would also help American enterprises that have lost business due to the competition created by cheaply-produced imports. “By cracking down on this loophole and providing law enforcement with more resources, this bipartisan legislation will begin to level the playing field for Ohio workers and Ohio manufacturers and retailers—while helping to stop the deadly flow of fentanyl into Ohio communities,” he explained.
Oregon American Federation of Labor and Congress of Industrial Organizations (AFL-CIO) president Graham Trainor said the group stands behind Sen. Wyden’s efforts “to close a dangerous trade loophole that has undermined policy and makes it vastly easier for illicit goods, including fentanyl, to enter our country.”
“Unions have always stood on the side of fair trade, and the bill proposed by Senator Wyden is a step in the right direction toward trade policies that protect American workers and consumers,” he added.
Meanwhile, Washington, D.C. trade group the National Council of Textile Organizations (NCTO) also backed the bill due to the impact it could have on American textile producers.
“We sincerely appreciate Chairman Wyden’s leadership and the support of all the co-sponsors on this critical bipartisan legislation designed to reform the outdated de minimis provision in U.S. trade law and curtail the abuse of this loophole, which has had a devastating impact on U.S. manufacturers,” said NCTO president Kim Glas.
“The bill is by far the most comprehensive legislative proposal to date that would impose new penalties for violations, require additional data reporting on all de minimis packages, and impose a small customs user fee on packages,” she added. “We fully support the legislation as a strong step toward addressing this glaring loophole, which facilitates 4 million packages a day that bypass federal scrutiny and enter the U.S. duty free, and acts as a gateway for products made with forced labor, counterfeits, toxic products and illicit narcotics such as fentanyl.”
Glas said NCTO was “encouraged” by the thoroughness of the framework’s “sound legislative approach,” and that it was hopeful about the bill’s ability to “shield and bolster vital domestic supply chains.”
The Outdoor Industry Association (OIA), which counts outdoor sector leaders like The North Face, Patagonia, REI, JanSport and Eastern Mountain Sports as founding members, applauded the introduction of the FIGHTING Act this week. The group’s president, Kent Ebersole, said the legislation “provides a comprehensive and enforceable solution to protect American outdoor consumers and businesses from unfair foreign competition.”
“As the e-commerce market has exploded, Section 321 de minimis entry has become a pathway for bad actors to flood the U.S. market with inferior, illicit, and counterfeit goods—some of which may have been created using forced labor,” he added. “De minimis shipments do not pay duty, tax, or other customs fees—leaving companies in the outdoor industry that are shipping in bulk and distributing from U.S. warehouses at an extreme economic disadvantage.”
According to Ebersole, “The difference is so great that a new logistics industry has emerged across our southern and northern borders—at the expense of American investment and employment.” The bill would reduce the “perverse incentive” to offshore operations, giving U.S. brands the ability “to compete once again on a more level-playing field.”