Last week, Customs announced a proposed change to the rules for de minimis procedures. After reviewing the proposal, I’ve summarized the key points below.
Currently, there are two methods for de minimis clearance:
Manifest Clearance (Section 321 Line Release):
- This method allows for filing shipments, including those subject to quota, ADD (anti-dumping duties), CVD (countervailing duties), or PGA (partner government agencies) requirements.
- However, under the proposed rule, the line release process will no longer be available.
Type 86 Entry:
- This will become the primary process for de minimis shipments.
- Eligible shipments under Type 86 exclude those subject to ADD, CVD, and any shipments "precluded by law."
- The proposal does not clarify what "precluded by law" means, leaving room for interpretation. For example, a handgun without an ATF permit may be ineligible, but one with an ATF permit and Form 6A might qualify.
The comments on the rule also noted that shipments subject to quotas or IRS taxes (e.g., alcohol and tobacco) would not be eligible. However, the proposed rule itself does not explicitly mention these exclusions.
$800 Per Person Rule:
The $800 per person de minimis threshold will remain in effect. Customs has been testing enforcement and will require informal entries if they identify multiple shipments purchased by the same person on the same day, even if from different sellers, totaling over $800.
Who Can Make Entry?
Entries can be made by:
- The owner (seller or manufacturer),
- The consignee (e.g., a 3rd-party receiving warehouse),
- The purchaser, or
- A Customs broker appointed by any of the above.
Although Customs brokers are not required, I believe we offer valuable expertise in data processing that makes our services worthwhile.
Required Data:
For Type 86 entries, the following information will be required:
- House bill of lading
- Country of origin
- Shipper’s name, address, and country
- Name and address of the exemption claimant
- Specific description of the goods
- Manifest quantity
- Shipment weight
- Fair retail value
- Name and address of the final delivery recipient
Enhanced Data Requirements:
The enhanced process will require additional details, such as:
- Tracking number or house bill of lading
- Export country
- 10-digit HTSUS classification (with a procedure to waive this in certain cases, e.g., for websites selling a variety of apparel)
- Supporting documentation, which may include:
- URL to marketplace listing
- Product pictures
- X-rays by the consolidator
- Product identifiers
- Seller’s name and address
- Purchaser’s name and address
- PGA documentation
- Advertised retail description
- Marketplace website or contact information
Other Key Points:
- Section 301 duties (tariffs) are rumored to be excluded from this procedure, but I could not find this in the proposed rule.
- On today’s bi-weekly trade call, we learned that Lacey Act declarations will not be required for de minimis shipments.
Comment Period:
There is a 90-day public comment period for this proposed rule. I have several questions I’d like to ask and would appreciate hearing others' thoughts. Please share your comments or insights!
