CBP Outlines Biden's Proposal to Streamline Processing of de Minimis Shipments

CBP unveiled Aug, 2 a list of proposals further defining just how President Joe Biden expects the agency to implement Biden’s "Detect and Defeat" legislation (see 2407310030) aimed at thwarting fentanyl and other illicit drugs from entering the U.S. via the millions of de minimis shipments or imports that are worth less than $800.

Among the proposals are a 10-digit Harmonized Tariff System number requirement as well as a $2 processing fee for all de minimis shipments and a shortened abandonment time frame of 15 days.

CBP officials say the proposals, which still need to be debated and voted on by Congress, borrow ideas from both CBP’s 21st Century Customs Framework and from congressional leaders. Similar provisions are included in a draft bill Senate Finance Committee Chairman Ron Wyden, D-Ore., is circulating for discussion with the trade (see 2408020031).

“We don’t view these proposals as the only answer to de minimis. As I already said, we believe that this is a multi-faceted challenge that must be approached from multiple angles, looking at modes, merchandise, actors and operations,” said Felicia Pullam, executive director for CBP’s Office of Trade Relations.

The proposals, announced on a call with members of the trade community, “do not compete with other proposals that are on the Hill. Rather, they are essential companions to any other reform. These proposals do not, by any means, represent the entirety of what CBP and the administration are considering or planning. These proposals are essential to enable us to deal with the current flow, and we need these reforms to implement any of the other reforms that have been proposed,” Pullam continued. She added that CBP still intends to move “full speed ahead” with the 21st Century Customs Framework currently advancing through interagency review.

The proposals include the following, according to Gail Kan of CBP’s Office of Trade:

1) Change existing statutory language to enable CBP to obtain more data from parties in the supply chain earlier in the process, including asking for the 10-digit HTS number.

When asked after the call whether CBP would exempt some filers from the 10-digit HTS number requirement, a CBP spokesperson told International Trade Today, “The current proposed language does not preclude the possibility of an exemption or waiver to be implemented by regulation.” CBP officials have said the agency could waive the 10-digit HTS number for de minimis filers that demonstrate they can identify partner government agency commodities, as long as the shipment doesn’t have PGA requirements (see 2106240064).

2) To better manage the flow of de minimis shipments, change the summary forfeiture statute for de minimis shipments. This action aims to expand the scope of counterfeit or “problematic” goods eligible for summary forfeiture, such as equipment used to manufacture controlled substances.

3) Shorten the time frame for shipments voluntarily abandoned from 30-60 days to 15 days. This change would apply only to de minimis shipments. This proposed change, as well as the one directly above, would help CBP to process shipments faster and facilitate the agency’s ability to do enforcement, according to Kan.

4) Enable CBP to share more information directly with CBP stakeholders and partners. This wouldn't be information “for all the world to see,” but rather would allow CBP to “share certain information with our trade stakeholders so that we can ask them to self-police their supply chain and be force multipliers in the enforcement efforts,” Kan said. This proposal would allow “CBP to share more information than we ever have, but it also does take into consideration issues such as the Trade Secrets Act” and CBP’s privacy act, she said.

5) Modify CBP’s existing penalties, including expanding the list of what would be prohibited goods subject to 19 U.S.C 1595a and 1595b, which pertain to aiding unlawful importation. This would entail building a minimum “penalty floor” of $5000 to make penalties more impactful, particularly for packages where the value is significantly low, like $1 or $5. This would also include expanding the types of prohibited goods subject to penalties, such as controlled or regulated substances like precursor chemicals that could be used to manufacture fentanyl.

6) Implement a user fee under 19 U.S.C. 58, where de minimis packages would be subject to a $2 processing fee. This would only apply to shipments that aren't subject to other fees.

Since the proposals are still part of legislation from the White House, they must be approved by Congress, which means that their implementation -- as well as what exactly gets approved and implemented -- is still pending, CBP staff reiterated. As a result, implementation time frames are uncertain.

As the White House puts forth these proposals, CBP will continue moving forward with its existing regulatory agenda, which includes continuing to develop its low value shipment regulations based on the lessons learned from its Section 321 data pilot and Type 86 pilot, as well as other legislative proposals that came out of the 21st Century Customs Framework initiative, CBP officials said on the call.