Proposed Solution

Change de minimis entry eligibility from a limitless opportunity for foreign entities into a privilege

This would:

  • Eliminate the existing economic advantages offshore distributers have compared to U.S.-based e-commerce fulfillment operations.

  • Create American jobs, as opposed to foreign jobs.

  • Help curb the health and safety risks American consumers face when receiving online purchases.

OUr Two-Tiered Plan

1.

Provide DE Minimis eligibility to goods withdrawn from FTZs

This will create an equitable landscape for U.S. companies, against duty-advantaged foreign competitors, and eliminate the incentive to move facilities and jobs out of the U.S.

Simultaneously, it will help reduce the risk of counterfeit, infringing, and illicit goods from entering U.S. commerce due to CBP’s supervision of U.S. FTZs, versus their negligible visibility over goods shipping directly to consumers from warehouses outside the U.S.

 

WHY U.S. FOREIGN TRADE ZONES?

  • CBP has limited insight into the contents and origin of existing de minimis shipments coming from foreign warehouses. In contrast, CBP has significantly stronger oversight of shipments originating from U.S. FTZs.

  • FTZ operators are inherently compliant, trusted importers.  

  • Facilities must receive FTZ Board and CBP approval before operations can commence.

  • FTZs must adhere to strict regulatory reporting requirements. Failure to do so could revoke FTZ status.

  • CBP regularly inspects for compliance with federal laws, regulations and CBP policies.  Among other things, this prevents the ability to skirt partner governmental agency requirements, like CPSC, FDA, NHTSA product testing standards.

Allowing goods withdrawn from FTZs to be eligible for de minimis entry will help free up CBP resources to focus on shipments that pose risk of having counterfeit or illicit contents.

2.

Make de minimis entry a privilege

Require CBP to work with relevant stakeholders to develop and implement a process to promote de minimis entry eligibility for trusted actors, instead of being a limitless open-ended opportunity.