Policy & Procedure

Preparing for change in light of Trump’s inauguration.

Your weekly All-Ways round-up of Supply Chain news.

A proposal to exclude Chinese goods covered by Section 301 tariffs from the "de minimis" program, which allows duty-free treatment for shipments under $800 would affect over a third of shipments, as 70% of low-value imports from China fall under upcoming stricter trade regulations.

U.S. Customs and Border Protection (CBP) will require more detailed electronic data for low-value shipments to better identify risks like smuggling and counterfeit goods. This builds on the existing voluntary "Type 86" filing process, already used by many e-commerce shippers.

Platforms like Shein and Temu may face operational changes, such as shipping goods in bulk and fulfilling orders domestically, as Mexico also tightens trade rules to prevent tariff evasion.

Critics argue that enforcing these rules will strain CBP’s resources, given the volume of low-value shipments, which have surged from 134 million in 2015 to over 1 billion in 2024.

Congress is considering reforms to the de minimis process. Further restrictions may extend to imports from other countries, potentially increasing trade costs and compliance burdens.

The changes aim to address trade enforcement challenges but raise concerns about administrative feasibility and the economic impact on e-commerce.

The U.S. Department of Homeland Security (DHS) has added 37 companies to the Uyghur Forced Labor Prevention Act (UFLPA) Consolidated Entity List, spanning industries such as textiles, energy, solar, and zinc.

An additional company’s name was corrected on the list. Goods linked to these entities or produced in the Xinjiang Uyghur Autonomous Region (XUAR) are presumed to involve forced labor and are inadmissible under U.S. law.

The new additions include entities involved in forced labor recruitment and transportation, as well as those sourcing materials from XUAR-linked government labor schemes.

Notably, Xinjiang Zijin Zinc Industry Co., Ltd. was added to multiple UFLPA categories. A procedural mechanism exists for entities to appeal their inclusion on the list.

Since the UFLPA’s enactment, over 100 entities across various sectors have been listed. DHS will continue evaluating potential additions.

The announcement can be read in full here and the list can be reviewed here.

President-elect Donald Trump announced plans to establish a new agency called the External Revenue Service (ERS) to collect tariffs and revenue from foreign sources.

The proposal aligns with suggestions from former adviser Steve Bannon, who advocates shifting the tax burden away from Americans by relying on tariffs and fees on foreign access to U.S. markets.

Trump described this initiative as a move away from domestic taxation via the Internal Revenue Service (IRS), stating that tariffs could become a primary revenue source for the country, replacing income taxes.

Currently, tariffs are collected by U.S. Customs and Border Protection, and the costs are often passed on to consumers, raising concerns about inflation. Trump has proposed a universal tariff of 10–20% on all imports and additional tariffs on top trading partners like China, Canada, and Mexico, which could further drive up prices.

Trump announced the agency's planned launch date as January 20, coinciding with his inauguration. The transition team has not clarified the details of the policy.

The FDA has revoked authorization for red dye 3 in food and ingested drugs, requiring reformulation by January 15, 2027, due to the Delaney Clause, which bans substances linked to cancer in animals or humans.

While the FDA states current science does not support claims of harm from dietary exposure to red dye 3, the decision follows pressure from consumer groups, legislators, and data showing cancer in male rats. The dye remains banned in cosmetics.

Concerns over red dye 3's potential carcinogenicity, neurobehavioral effects in children, and bans in the EU, Australia, and New Zealand have fueled petitions and legislative actions, including California’s Food Safety Act, effective 2027, which also bans the dye.

Growing scrutiny of synthetic food dyes is driving FDA’s focus on chemical safety reviews, with California’s School Food Safety Act set to ban six synthetic dyes in schools by 2027.

Consumer groups continue to advocate for broader bans on artificial food colorants.

In November, the U.S. trade deficit rose 6.3% to $78.2 billion, following a 12% drop in October.

Both exports and imports reached record highs. Imports increased 3.4% to $351.6 billion, driven by gains in goods like semiconductors, aircraft, passenger cars, crude oil, and gold.

Exports rose 2.7% to $273.4 billion, with notable increases in passenger cars, pharmaceuticals, crude oil, and plastics.

The goods trade deficit grew 5.5% to $103.4 billion, while the services trade surplus increased 3.7% to $25.2 billion.