US Senate bill aims to fight illegal product imports

A bill introduced in the US Senate is calling for tighter controls on imports of products from e-commerce giants like Shein and Temu to combat the trade in counterfeit and otherwise illegal goods.

The bipartisan Fighting Illicit Goods, Helping Trustworthy Importers, and Netting Gains (FIGHTING) for America Act has been proposed by five senators in the Senate Committee on Finance in response to a quadrupling in the number of small package shipments into the US since 2017 to reach more than a billion valued at more than $50bn in 2023.

"These small packages qualify for streamlined customs procedures under 'de minimis' entry, making it difficult for border security to detect and stop packages containing fentanyl and other illicit drugs, counterfeit goods, and products made with forced labour," said Sen Rony Wyfen (D-Ore), one of the architects of the bill.

"It's time to tighten the rules and crack down on these low-value imports to ensure that unscrupulous foreign actors can no longer game the system and put American communities at risk," he added. The de minimis rules allow packages under $800 to enter the country tariff-free and under a streamlined process.

The sheer volume of packages is "overwhelming" the capacity of Customs and Border Protection (CBP) to protect the US from illegal goods, according to the senators, who also include Cynthia Lummis (R-Wyo), Sherrod Brown (D-Ohio), Susan Collins (R-Maine) and Bob Casey (D-Pa).

"Chinese companies continue to abuse US trade laws. It is necessary that we tighten customs oversight of low-value imports entering the United States to combat these abuses of tariff-free entry procedures," said Collins.

"This bipartisan bill would strengthen CBP enforcement, improve data collection, and streamline the import approval process to address unlawful imports and protect domestic industries while ensuring fair trade practices."

Specifically, FIGHTING would bar certain categories of products from the de minimis loophole, including textiles, apparel and leather goods and any product subject to anti-dumping or countervailing duties or tariffs.

It would also require CBP to collect additional data on low-value shipments to better target and intercept unlawful imports, make it easier for the agency to seize and dispose of them, increase penalties for violations of the rules and introduce a fee of $2 per shipment for any product using the procedure.

Kim Glas, president of the National Council of Textile Organizations (NCTO), was among trade representatives who welcomed the move.

"We fully support the legislation as a strong step toward addressing this glaring loophole, which facilitates four million packages a day that bypass federal scrutiny and enter the US duty-free," she said.

The current situation "acts as a gateway for products made with forced labour, counterfeits, toxic products and illicit narcotics such as fentanyl," she added.

CBP estimates the average value of de minimis shipments entering the US is about $54, well below the maximum threshold for duty-free purchases from abroad.