U.S. Cracks Down On Shein, Temu

Chinese vendor Yin Xinwei, who sometimes makes up to $1,400 a day selling low-priced pillboxes, barbecue spits, and other items to U.S. consumers, now faces an uncertain future amid a new U.S. regulatory change primarily targeting Chinese e-commerce platforms Temu and Shein, Eunice Yoon from CNBC and Jennifer Jett from NBC News reported.

The White House recently announced plans to narrow the loophole to prevent abuse and strengthen protections for American consumers and workers. I Photo: DMCGN Wikimedia Commons

The change could have significant consequences for Chinese sellers like Yin, who depend heavily on overseas markets.

“The business model could disappear,” Yin said in an interview from his office in Shenzhen, China. Both platforms have experienced explosive growth thanks to a customs exemption that allows packages worth less than $800 to enter the U.S. almost tax-free and with minimal scrutiny.

The use of this “de minimis” exemption has skyrocketed since the threshold was raised to $800 in 2015, explained David Townsend, an international trade expert and partner at the U.S.-based law firm Dorsey & Whitney.

Each year, hundreds of millions of packages from Chinese platforms are shipped directly to U.S. consumers who are eager for rock-bottom prices on clothing, electronics, and other products.

However, the White House recently announced plans to narrow the loophole to prevent abuse and strengthen protections for American consumers and workers.

The change could bring higher costs for Chinese sellers and increased prices for American buyers.

Chinese state media criticized the proposal as protectionist, arguing it would hurt U.S. consumers. “Without the exemption, costs will be higher,” Yin said. “Products might need to be priced for Temu closer to Amazon’s levels.”