WASHINGTON, Jan 17 (Reuters) - The Biden administration

on Friday issued last-minute proposed rules to curb duty-free

imports under the $800 "de minimis" threshold, denying the

low-value shipments exemption for goods that are subject to

other punitive U.S. tariffs.

The move marks a setback for e-commerce firms, including

China-based Shein and PDD Holdings' Temu, which have

exploited the de minimis threshold to ship millions of small

packages a day to U.S. customers.

The Biden administration first announced in September that

it was taking steps to curb the trade "loophole" that it blames

for shipments of fentanyl precursor chemicals to evade customs

inspection and tariffs.

U.S. Customs and Border Protection agency said the proposed

rules would deny duty-free exemptions to low-value packages

containing goods subject to Section 301 tariffs on hundreds of

billions of dollars of Chinese imports, including many apparel

items. They also would eliminate similar exemptions to goods

subject to Section 232 tariffs on steel and aluminum and Section

201 duties on solar products.

In addition, small package shippers also will be required to

include the 10-digit Harmonized Tariff Schedule classifications

for the package contents in order to claim the exemption. The

move will allow customs officials to better identify and

interdict illicit goods.

"We cannot let Chinese-founded e-commerce platforms gain an

unfair trade advantage while American businesses play by the

rules," National Economic Advisor Lael Brainard said in a

statement.

"Today's actions are an important step forward to level the

playing field for American workers, retailers, and manufacturers

and to enforce U.S. laws that protect the health and safety of

our consumers."