Temu and Shein’s favorite import policy is about to disappear

Adios, de minimis loophole

9/13/24 9:55AM

Last month, we discussed a proposal from five US senators to crack down on Chinese e-commerce companies taking advantage of the "de minimis" loophole to ship billions of dollars of goods to the US, duty-free.

The TL;DR: The US's Tariff Act of 1930 established a de minimis threshold that allowed low-cost imports to enter the country duty-free and tariff-free to expedite transit through customs. As recently as 2014, the total value of goods entering the country through de minimus was still under $1 billion, but the emergence of fast fashion e-commerce brands, especially in China, has caused an explosion in de minimis shipments, with more than $40 billion of de minimis imports entering the country each year since 2019. A 2023 congressional investigation showed that in 2022, 30% of de minimis shipments came from Shein and Temu alone, and 62% came from China.

As previously mentioned, the de minimis loophole could be costing the US government $400 million in missed duty fees, and today, the Biden administration announced that it would be cracking down on this loophole. According to The Wall Street Journal, around 70% of Chinese textile and apparel shipments will now be subject to tariffs that they were previously avoiding.

The de minimis loophole allowed Temu and Shein to pass cost savings on to their customers, but with this policy change, users will likely see prices tick up to account for the new fees. Not great news for Temu, especially, which has seen its app downloads flatline in the US.

David Crowther, Claire Yubin Oh

TAKING PITCHES

11/3/25

Warren Buffett’s big cash pile just hit $382 billion — what could Berkshire buy?

Berkshire Hathaway is throwing off more money than ever before — but Buffett and co. are staying patient.

CEO Warren Buffett Attending Baseball Game

3d sketch poster trend collage image of healthy salad leaves nutrition rotten iceberg mouth smile lips food diet hand hold fork

The slop bowl recession just sent Chipotle’s stock cratering

Chipotle dropped 18% yesterday, and its woes weighed on the wider slop bowl complex, dragging Cava and Sweetgreen down, too.

Claire Yubin Oh10/31/25

J. Edward Moreno

10/30/25

Most health insurers beat estimates in Q3, but investors have mixed feelings

While generally in line with expectations, medical costs still haven’t come down.

Millie Giles10/30/25

eBay stock slumps on gloomy Q4 outlook despite solid Q3 earnings

Shares of eBay fell as much as 10.5% in premarket trading on Thursday morning after the company gave a lower-than-expected profit forecast for the important holiday shopping season.

The e-commerce giant reported solid numbers for the third quarter on Wednesday, with revenue up 9% as reported to $2.8 billion and gross merchandise volume rising 10% to $20.1 billion, topping the average analyst forecast of $19.4 billion, per Bloomberg.

However, concerns about the future somewhat overshadowed these results.

eBay outlined its profit outlook for the period ending in December to $1.31 to $1.36 a share, with revenue at $2.83 billion to $2.89 billion. According to Bloomberg-compiled data, this broadly matches Wall Street’s estimates for the top line, but misses on the bottom line, with analysts forecasting EPS to come in at $1.39 — suggesting the company expects some further margin pressure.

The company has been facing macroeconomic challenges since the US ended the de minimis tariff exemption in late August, with the online marketplace reliant on shipments. One small silver lining? CFO Peggy Alford highlighted a “less durable trend” on a post-earnings call: that as commodity prices for precious metals boomed, demand for bullion and collectible coins on eBay spiked.