A Senate bill aims to increase scrutiny of US e-commerce imports to address shipments containing illegal and counterfeit products.

The proposed legislation, titled the "Fighting Illicit Goods, Helping Trustworthy Importers, and Netting Gains (FIGHTING) for America Act," was introduced in response to the influx of e-commerce shipments from Chinese online shopping giants like TEMU and Shein into the US in recent years.

The bipartisan bill would end current tariff exemptions for packages valued under US$800.

The proponents of the FIGHTING For America bill argue that the increasing volume of e-commerce goods being imported into the US is making it more challenging for Customs and Border Protection (CBP) to monitor these shipments.

"The surge in low-value shipments has been facilitated in part by a provision of US law called 'de minimis' entry, which allows packages valued at less than US$800 to enter the United States tariff-free and under a streamlined process," the proposal said.

"While de minimis was intended to conserve government resources and simplify customs procedures for small businesses and consumers, unscrupulous corporations like Shein and Temu have abused the system, building entire business models around their ability to flood the US market with direct-to-consumer shipments that avoid both tariffs and Customs scrutiny," it added.

The bill still needs to be passed by both the US Senate and the House of Representatives before it can be signed into law by the president.

The proposed legislation noted that the number of low-value shipments imported into the United States quadrupled from 299 million to 1 billion between 2017 and 2023, and this number continues to grow.

"This dramatic increase in small packages is overwhelming CBP, making it increasingly difficult to effectively target shipments for scrutiny and stop packages containing illicit drugs, counterfeits, and other goods that endanger American communities or violate US law," it said.

Bill provisions

The bill would bar certain categories of products from being imported through de minimis, including goods designated as "import-sensitive" such as textiles, apparel, and leather goods; goods subject to anti-dumping or countervailing duties; goods subject to tariffs imposed pursuant to a Section 301, Section 232, or Section 201 investigation; and other types of goods that CBP has identified as experiencing a surge in de minimis imports or presenting a persistent risk of illegal importation.

The proposed legislation would also require the CBP to collect additional data on low-value shipments to better target and interdict unlawful imports, streamline procedures for the CBP to seize and dispose of unlawful goods shipped through de minimis, and increase penalties for violations of de minimis rules.

It will also establish a fee of US$2 per shipment for the use of de minimis entry procedures.

The five senators proposing the bill said the practice of shipping small packages to individual consumers has come to rely on international air courier services, making it far more carbon-intensive than the traditional model of importing goods via container ship and sending them to consumers from warehouses.

The US has been tightening up its rules on e-commerce shipments entering the country.

The CBP, on February 15 this year, updated the deadline for filing a Type 86 entry to "upon or prior to arrival" of the cargo. Prior to this change, entry Type 86 could be filed within 15 days of cargo arrival.

It also suspended "multiple customs brokers" from its Entry Type 86 Test programme that covers the duty-free import of shipments worth less than US$800 into the US.

The CBP has issued the change to address compliance challenges related to 'de minimis' entries.

Since its introduction in 2019, CBP has seen an influx of shipments cleared under Entry Type 86 — which allows for goods under the de minimis value of US$800 to be imported without payment of duties and taxes.​

The adjusted clearance deadline helps CBP effectively mitigate the risk previously enabled by shipments leaving the port of entry prior to CBP review. This change also promotes better visibility of goods entering US commerce.