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US Customs says it is prepared to handle new inspection

volume

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Airlines, ocean vessel operators to collect new duties on

parcels

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Duties to be collected before goods are shipped out of

China and

Hong Kong

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Shipping industry concerned about renewed delays,

disruptions

By David Lawder and Lisa Baertlein

WASHINGTON/LOS ANGELES, May 2 (Reuters) - The Trump

administration ended U.S. duty-free access for low-value

shipments from China and Hong Kong on Friday, removing the "de

minimis" exemptions availed of by Shein, Temu and other

e-commerce firms as well as traffickers of fentanyl and other

illicit goods.

The action restores an executive order from President Donald

Trump in February that was quickly suspended due to a lack of

screening procedures for sub-$800 shipments that sparked chaos

at airports and caused millions of packages to pile up.

U.S. Customs and Border Protection has "a massive task at

hand" but is ready to handle the enforcement and collection of

Trump's tariffs on small Chinese shipments, a spokesperson for

the agency said.

"We are prepared and equipped to carry out enhanced package

screening and enforce orders effectively as outlined" in Trump's

executive order ending de minimis treatment for China, the

spokesperson added.

The new procedures should not affect passenger wait times at

airports and ports of entry, the spokesperson said. The packages

are handled in the cargo section of airports, even when they

arrive in the bellies of passenger planes.

Under CBP's latest guidance, shipments from China and Hong

Kong regardless of size will now be subject to Trump's new

tariffs of 145% plus any prior duties, except for products such

as smartphones which were excluded last month. These will

largely be handled by express shippers such as FedEx ( FDX ),

United Parcel Service ( UPS ) or DHL, which have their

own cargo handling facilities.

Items valued at up to $800 and sent from China via postal

services are treated differently. They are now subject to a tax

of 120% of the package's value or a flat fee of $100 per package

- an amount that rises to $200 in June.

COLLECTIONS AT TAKE-OFF

The U.S. Postal Service said it would not be involved in any

duty collections. Instead, a USPS spokesperson said, airlines

and vessel operators would need to work with shippers and

Chinese postal authorities to pay the import taxes and show

proof before the goods are transported out of China or Hong

Kong.

Although de minimis is a Latin term referring to matters of

little importance, low-value shipments from China to the U.S.

reached an estimated $5.1 billion in 2024, according to U.S.

Census Bureau data. That made it the seventh-largest U.S. import

category from China, behind video game consoles, but just ahead

of computer monitors.

Shippers were bracing for more package chaos, and some

questioned whether airlines were prepared to handle duty

collection from China Post and Hongkong Post.

"We have the same worry about bottlenecks," said Kate Muth,

executive director of the International Mailers Advisory Group

(IMAG), whose members include Amazon.com ( AMZN ), eBay ( EBAY )

and divisions of United Parcel Service ( UPS ), FedEx ( FDX ) and DHL.

"I don't think we're ready for the change because we're

still awaiting some clarification around the rules," including

how to define Chinese origin for goods that are shipped from

other countries, Muth said.

FORMAL ENTRY SHIFT

A late change in the CBP's guidance took away a major

complication for shippers, but created a potential new hurdle to

enforcement as CBP temporarily suspended a rule that would have

required formal customs entry for all shipments valued at over

$250 containing goods that are also subject to punitive tariffs.

Formal customs entry, normally associated with larger,

containerized cargo, requires full 10-digit tariff codes for all

items, advance electronic transmission of entry data and a bond

to cover for customs liability.

And it would have applied to many other countries now

subject to U.S. tariffs imposed by Trump, creating a potential

new crush of administrative paperwork for shippers.

Instead, the suspension allows the use of informal entry

procedures for shipments from China and Hong Kong valued at up

to $800 and up to $2,500 from elsewhere, requiring no tariff

codes and a less detailed contents description.

Lori Wallach, director of Rethink Trade, which has advocated

an end to the de minimis exemption, said the use of informal

entry would make it harder to screen packages.

"Without it being electronic or having an HTS code, the

whole system that's used to inspect and to prioritize things

that should be pulled for inspection doesn't work," Wallach

said.

Trump ended the de minimis exemption for China largely

because it was being used for largely unscreened low-value

shipments containing fentanyl precursor chemicals into the U.S.,

a phenomenon documented in a Reuters series about fentanyl.

(Reporting by Lisa Baertlein in Los Angeles and David Lawder in

Washington; additional reporting by David Shepardson in

Washington; Editing by Muralikumar Anantharaman)