The proposed changes mark a significant development in the ongoing U.S.-China trade tensions, following recent export controls aimed at curbing China's advancements in technology.

The Biden administration has proposed new regulations to address the misuse of the 'de minimis' exemption, which has allowed Chinese e-commerce companies like Temu and Shein to ship products valued under $800 to U.S. customers without incurring tariffs.

The surge in de minimis shipments has been significant, increasing from about 140 million annually to over 1 billion in the past decade, complicating efforts to intercept illegal or unsafe imports.

These measures are part of a broader effort to ensure fair competition for U.S. businesses and will apply tariffs to certain shipments from China.

The White House has highlighted that the abuse of the de minimis exemption harms American consumers, workers, and businesses.

If implemented, these rules could lead to higher prices for consumers who have turned to platforms like Shein and Temu for affordable shopping options.

Temu has stated that it is reviewing the new proposals and maintains that its growth is not dependent on the de minimis policy.

This initiative aligns with the U.S. goal of reducing dependence on Chinese products and protecting emerging industries, particularly in electric vehicles and advanced technology.

Under the new rules, these companies will no longer be able to claim exemptions for low-cost products, which has raised concerns about consumer safety and fair trade violations.

This change primarily targets companies like Temu and Shein, which have exploited the loophole to flood the market with low-cost items while evading tariffs.

White House officials, including Deputy National Security Adviser Daleep Singh, emphasized that the increase in de minimis shipments complicates efforts to block illegal imports and maintain safety standards.

The proposed regulations will require shippers to provide more detailed information, including a 10-digit tariff classification number and identification details of the exemption claimant.