On June 28, 2023, Mike Gallagher (R-WI), Chairman of the Select Committee on the Chinese Communist Party, and James Comer (R-KY), Chairman of the House Oversight and Accountability Committee, jointly sent a formal letter addressed to USPS Postmaster General Louis DeJoy requesting data on Chinese-origin mail and shipments entering the United States. The letter also requests all records related to de minimis shipments from 2021-2022 and the total U.S. dollar value of terminal dues and inward land rates currently assessed to the PRC.
The letter reflects a determined effort to combat Section 321 (de minimis rule) used by many exporters and importers of products into the U.S. Given USPS's significant role in handling a substantial proportion of small parcel shipments, accessing its records is key to fully assessing the impact of the alleged problems created by Section 321. While other federal agencies, such as Customs and Border Protection (CBP), provide data on de minimis entry shipments originating from the People's Republic of China (PRC), this does not include data from USPS. Detailed information on inbound mail data, de minimis shipments, and revenue statistics will equip lawmakers with a comprehensive understanding of the scale of regulatory evasion.
Congress has found that Chinese e-commerce companies have utilized the de minimis provision to their advantage. Using tactics such as breaking down larger shipments into smaller ones, these companies are able to exploit the de minimis threshold, avoiding customs duties and tariffs. A report from the House Select Committee on the Strategic Competition between the United States and the Chinese Communist Party released on June 22, 2023, states that Chinese e-commerce companies "account for almost 600,000 such packages shipped to the United States daily." Such practices undermine fair trade, posing significant risks to both the U.S. economy and national security.
Crowell & Moring, LLP continue to monitor this development and the potential impact to businesses and consumers moving forward.
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