U.S. Customs and Border Protection (CBP) announced a Notice of Proposed Rulemaking (NPRM) that would impose new data collection requirements on low-value shipments, also known as de minimis shipments. If adopted, the rule would create a new, alternative process for entering low-value shipments. The new process would require the submission of advance data such as origin, destination, and contents of the shipment.
De Minimis Background
The concept of de minimis shipments into the United States stems from customs regulations aimed at simplifying the importation of low-value goods. The term "de minimis" refers to shipments that fall below a certain value threshold, allowing them to enter the country with minimal duties or taxes.
Historically, the threshold was set at $200 but was raised to $800 in 2016 under the Trade Facilitation and Trade Enforcement Act (TFTEA). This change was designed to reduce administrative burdens on CBP and facilitate faster processing of e-commerce shipments, which were rapidly increasing in volume. Over the last decade, the number of shipments claiming the de minimis exemption has increased significantly, from approximately 140 million a year to over one billion a year.
Today, CBP processes over 4 million de minimis shipments into the U.S. each day. Current regulations require very little information about these shipments, making it increasingly difficult for CBP to identify and intercept high-risk shipments. The U.S. Congress and the Biden Administration have called for de minimis reforms.
The Proposed Rule
The rule proposes the establishment of an enhanced entry process that would require the submission of advanced data elements, including:
- Clearance tracing identification number (CTIN)
- Country of shipment of the merchandise
- 10-digit HTSUS classification
- Seller name and address
- Purchaser name and address
- Any documents required by other government agencies
- Advertised retail product description
- Marketplace name and website or phone number
The rule also aims to clarify the meaning of "one person" to ensure that the fair retail value of articles imported by one person on one day does not exceed $800. CBP proposes to amend the regulation to require that the "one person" is the owner or purchaser of the merchandise imported on one day.
Finally, CBP proposes amending the definition of "shipment" to clarify that a single shipment corresponds to an individual bill of lading.
CBP's stated purpose of the rule is to enhance supply chain visibility and enable CBP to better interdict illegal shipments across U.S. ports of entry.
Request for Input
Members of the public have until March 17, 2025, to comment on the proposed rule. If you will be impacted by the new requirements, make your voice heard by filing a comment! Diaz Trade Law can help you draft and file a comment and/or help you understand how this rule may impact your business.
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