New US de minimus rules are not the main threat to ecommerce traffic – The Loadstar

New de minimis The US proposals may raise fears of a reduction in air cargo demand, but it is complex data requirements that will prove the biggest hurdle for the global ecommerce market.

On Friday, the White House said: “The Biden-Harris administration is taking new actions to… address the significantly increased abuse of de minimis exemption, in particular e-commerce platforms established by China, and strengthening efforts to target and block shipments that violate US laws.”

The de minimis The rule allows shipments valued at $800 or less to enter the US duty-free and with minimal scrutiny and has seen US imports jump from 140 million packages a year to more than a billion in only for 12 months.

This is largely due to the flood of low-value goods coming from China through ecommerce platforms.

In the US proposal, the goods are no longer covered under de minimis represents about 40% of US imports and includes 70% of textile and apparel exports from China.

However, Ryan Keyrouse, CEO of market intelligence platform Rotate, told delegates at the EU CBEC ecommerce forum last week: “When you consider ‘what are the risks to e-commerce growth?’, many people talking about changes in de minimis in the US.

“But that change is not what you say is the biggest risk,” he added, referring to Rotate’s September 2024 industry survey on the main risks to ecommerce growth over the next two years.

My Keyrouse explained that, according to ecommerce data from the US, the average value density of shipments is around $15 per kg.

“These are small parcels,” he said. “So, you can have half a kilo, five kilos, etc… to give you an average value of $7.50/$75. You can keep playing it for a long time and you will see that it will be very difficult to reach $200, $400.

“So, if the at least is reduced from $800 to, say, $165, how much of an impact does that have on volumes? Most things will still fit in there.”

Over 80% of survey respondents agreed that if the de minimis has dropped or created a new policy barrier,”[ecommerce] will find another way.”

Mr Keyrouse added: “Security concerns from misstatements and politically motivated policies are said to be the biggest risks at the moment.”

In fact, 33 respondents listed ‘politically motivated policies’, such as raising tariffs to gain electoral favor, as their main concern. 24 respondents said security risks will be the biggest drag on ecommerce growth and only 22 listed a change in de minimis.

The White House proposal also promises to “strengthen information collection requirements” to gain visibility de minimis shipments.

Requirements will include specific additional data for de minimis shipments, including the 10-digit tariff classification number and the person claiming the exemption.

“These new requirements will help US Customs and Border Protection (CBP) protect consumers from goods that do not meet regulatory health and safety standards and protect US businesses from unfair competition against imported products,” it said.

Additionally, Consumer Product Safety Commission (CPSC) staff will require importers to file Certificates of Compliance electronically with CBP and CPSC at the time of entry, including for de minimis shipments.

But an industry executive said The Loadstar: “If you have to give all the data, you need a lot of permission, and each country has different rules; in Kenya, it is illegal to give people’s data, for example.

“A recent rule said it needed IP addresses – but what about VPNs? Impossible.”

They added: “The new Transport Canada rules says you can only ship if you have a six-shipment relationship with the sender, which effectively means you can’t switch to a new forwarder.

“So, your existing forwarder can charge whatever it likes because you cannot change. So, another stupid government has come forward.”