NCTO says the de minimis loophole has allowed a flood of low-value, duty-free shipments to enter the US market. Credit: Shutterstock.

The Fighting Illicit Goods, Helping Trustworthy Importers, and Netting Gains (FIGHTING) for America Act would tighten the rules for de minimis entry, which currently allows goods under $800 to reach consumers tariff-free and without thorough inspection.

The US Senate Committee on Finance states: “In recent years, the number of direct-to-consumer shipments from foreign corporate giants like Shein and Temu into the US has quadrupled.”

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It continues: “As the volume of packages has increased, Customs and Border Protection (CBP) has struggled to effectively target shipments and keep out packages containing illicit drugs, counterfeits, products made with forced labour and other goods that violate US law. 

NCTO president and CEO Kim Glas describes the legislation as the “most comprehensive approach to de minimis reform to date.”

She explains it will close the de minimis loophole for the vast majority of textile and apparel imports, impose new penalties for violations, require additional data reporting on all de minimis packages and impose small customs user fees.

Glas asserts the de minimis loophole has already severely harmed domestic textile and apparel manufacturers.

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She continues: “As a result, the US market has been inundated with a flood of low value, subsidised and often illegal and tainted imports that are endangering US consumers and undermining the US textile and apparel production chain.

“We commend Senate Finance Committee chairman Ron Wyden (D-OR), and senators Sherrod Brown (D-OH), Bob Casey (D-PA), Susan Collins (R-ME), and Cynthia Lummis (R-WY) for their leadership and support for this bipartisan legislation.”

Brown joined a call to close the de minimis loophole on 6 August and said he has repeatedly called on President Biden to take executive action to close the loophole.

Glas hopes the legislation will help shield and support the critical domestic textile and apparel manufacturing supply chain.

With the sector employing over 501,000 workers and producing $64.8bn in economic output, she says the bill will “help shield and support the vital domestic textile and apparel manufacturing supply chain.”

Last week (2 August), Glas commended the Protecting American Industry and Labor from International Trade Crimes Act which aims to boost federal investigation and prosecution of international trade crimes and impose strong criminal penalties against offenders.