Proposed CBP Rule Changes: Impact on UK-to-USA Shipments

The U.S. Customs and Border Protection (CBP) has proposed significant changes to how low-value shipments (under $800) are handled under the “de minimis” threshold. These changes aim to address concerns that the current system negatively affects domestic production by allowing low-cost imports to undercut U.S. manufacturers. There has been a growing public outcry to close this tax loophole, particularly for Chinese imports.

What is the De Minimis Value?

The de minimis value is a threshold under which imported goods can enter the United States without incurring duties or taxes. Currently set at $800, this policy was introduced to simplify customs processing and reduce administrative burdens for low-value shipments. 92% of shipments currently fall below the De Minimis value.

Benefits to Consumers:

  • Faster shipping times, as goods under the threshold bypass lengthy customs procedures.
  • Lower costs, as consumers are not burdened with additional duties or fees for small purchases.
  • More choice for consumers, as they can source – more easily – from international sellers.
  • Encouragement of cross-border e-commerce by making international goods more accessible.

However, while beneficial to consumers (and businesses wishing to import low-value products or components), this system has faced criticism for creating an uneven playing field for domestic producers, particularly as large e-commerce platforms leverage this exemption to ship vast low-value parcels to U.S. customers.

Key Facts About the Proposed Rule Changes

  • Duty-Free Status Revocation:
    • Goods already subject to U.S. tariffs, such as those under Section 301 (e.g., Chinese imports), Section 232 (steel and aluminium), and Section 201 (solar products), will no longer qualify for duty-free treatment, even if their value is below $800.
  • Enhanced Documentation Requirements:
    • Shippers will need to provide detailed descriptions of goods, including the 10-digit Harmonized Tariff Schedule (HTS) code, to enable CBP to enforce tariff regulations better and identify non-compliant goods.
  • Increased Scrutiny on E-Commerce Platforms:
    • The CBP aims to close loopholes that allow platforms like Shein and Temu to flood the market with low-value, under-declared parcels that bypass tariffs and inspections.
  • Fair Competition for U.S. Businesses:
    • These measures are intended to level the playing field for American manufacturers and retailers while ensuring that imports comply with health and safety standards.

How This Could Impact UK-to-USA Shipments

  1. Additional Administrative Burdens:
    • Small businesses may face more complex customs paperwork, with the requirement to classify items precisely using HTS codes. For many exporters, this could mean investing more time and resources in compliance.
  2. Higher Costs for Certain Products:
    • Goods that previously qualified for duty-free entry may now incur tariffs, increasing the cost of exporting these items to the USA. UK-made goods might require price adjustments to remain competitive.
  3. Longer Processing Times:
    • Stricter customs checks could result in delays for shipments, particularly for small-value goods. This could affect delivery timelines and customer satisfaction.
  4. Increased Competition:
    • Higher tariffs on UK goods might make U.S.-made alternatives more appealing to American consumers. Exporters of premium UK-made goods should highlight quality and unique selling points to maintain demand.

Our Advice for Adapting to These Changes

At Packed Posted, we’re here to help our clients navigate these new regulations and minimise their impact. Here’s how we recommend you prepare:

  • Stay Informed:
    • We keep track of all CBP updates and will share relevant information with you as soon as it becomes available. Staying ahead of policy changes is key to avoiding surprises.
  • HTS Code Compliance:
    • If you’re unsure how to classify your goods, we can help you with the process. Accurate use of Harmonized Tariff Schedule codes is essential to ensure smooth customs clearance.
  • Product Analysis:
    • We encourage you to review your product range and identify any items that might lose duty-free status. Together, we can assess their profitability and help you make informed decisions about your U.S. market strategy.
  • Customised Support:
    • Our logistics solutions are tailored to your needs. Whether it’s preparing detailed documentation or optimising your shipping process, we’ll help you adapt to these changes seamlessly.
  • Communicate with Your Customers:
    • If delays or cost changes are expected, we recommend being transparent with your U.S. customers. We can help you craft clear communication to maintain trust and satisfaction.
  • Highlight Your Product’s Quality:
    • UK-made goods are known for their quality. Use this as a selling point to appeal to U.S. consumers who value premium, well-crafted products. We’ll support you in positioning your brand effectively in this market.

By working with Packed Posted, you’ll be well-prepared to overcome these challenges and continue delivering exceptional service to your customers in the USA.