In a major shift as reported in China latest news, online shopping platform Temu has said that it will no longer be shipping products directly from China to American consumers. All U.S. purchases are now instead being shipped by locally based sellers.
This action is taken against the restriction of controls on a duty-free import policy known as the de minimis exemption. Temu and its large Chinese competitor Shein had previously employed this loophole to export inexpensive products to American shoppers without the payment of import taxes or duties.
Temu made it public that it is proactively looking for U.S.-based businesses to collaborate on the platform.
All American sales are now serviced by domestically based sellers, with fulfillment coming from within the country," the company said. "This move is designed to assist American merchants in expanding their reach."
This move has caught the eyes of trade watchers and policymakers monitoring China latest news, especially as the U.S. government intensifies scrutiny of imports entering the country from China.
What Is the De Minimis Exemption?
The term de minimis, which is Latin for "of minimal things," is an American trade policy enacted in 1938 to avoid investing resources in collecting minimal import duties. The level was raised over time, eventually allowing goods worth under \\$800 to arrive duty-free.
This exception became a chief windfall for such sites as Temu and Shein, whose models are predicated on the sale of low-cost items directly from China. As of a year ago, the U.S. Customs and Border Protection (CBP) reported that over 90% of all US-bound freight were de minimis.
But more and more, fears are being mentioned over and over again in China latest news to inspire bipartisan efforts to fortify or eliminate the exception.
Why the Crackdown?
Critics argue that the exemption harmed American businesses and was exploited for illegal smuggling, primarily synthetic opioids like fentanyl. The Trump administration in its second term has been focused on cutting the supply of such drugs—many of which supposedly pour in through cheap packages from China.
The president previously signed an executive order declaring that Chinese carriers typically hide illicit drugs in cargoes under the de minimis threshold. The administration testified that fentanyl alone accounted for over 75,000 American fatalities annually.
Based on China latest news, during an earlier suspension of the exception, the U.S. Postal Service temporarily suspended mainland China and Hong Kong imports, resulting in great inconvenience for retail merchants as well as freight carriers.
Market Reaction and Future Trends
Temu and Shein last month identified rising operating costs related to shifts in global trade policy. The two companies posted price adjustments effective April 25. Shein has yet to post a response to recent regulatory policies.
The Biden administration has also supported initiatives to close loopholes exploited under the de minimis exception. Authorities argue that the volume of shipments with low-value items renders it impossible to screen out dangerous or illicit items.
This new policy aligns with Trump's aggressive stance on Chinese imports. His administration, since he returned to office, has imposed tariffs as much as 145% on some products. Adding to the current levies, the overall Chinese import tariffs could be as much as 245% in some cases—a trend that is being followed closely in China latest news.
As Chinese online retailing giants adapt to these evolving regulations, their models of business are being radically rewritten. For now, platforms like Temu are attempting to localize operations and adapt to the new world of trade in the U.S., a topic that continues to be at the top of China latest news headlines.