This advisory alert is part of an ongoing series from Venable regarding noteworthy developments in trade laws expected in 2025. An introductory preview article is available HERE, and an alert about tariffs and trade policies is forthcoming.
2025 has arrived, and we encourage all importers, customs brokers, and other stakeholders involved in U.S. import activities to monitor key developments in Customs laws and regulations.
In light of carryover trends from 2024 and with President-elect Trump's cabinet and agency selections—including for Secretary of the Department of Homeland Security (Governor of South Dakota Kristi Noem), Secretary of State (current Senator Marco Rubio), and U.S. Customs and Border Protection (CBP) Commissioner (Rodney Scott)—likely headed for confirmation, we foresee aggressive stances by the Trump administration on de minimis reform, forced labor, supply chain shakeups amid Chinese trade abuses, and other customs issues. In some ways, this will be a return to form that existed under the first Trump term (2017-2020).
Below we briefly explore the customs priorities, some new and some old, that we expect to be making waves in 2025.
De Minimis Reform
In September, the Biden administration announced new actions aimed at preventing abuse of the de minimis exemption by Chinese e-commerce platforms. Low-value imports qualifying for the de minimis exemption have avoided general customs duties, the application of certain additional tariffs, and various data requirements. For nearly a decade now, the de minimis threshold has been set an aggregate value of $800 per person per day. The Biden administration proposed a new rulemaking to exclude from the de minimis exemption all shipments subject to certain additional U.S. tariffs—most importantly, Section 301 China tariffs, but also those arising from Section 201 or Section 232 trade actions. A large motivation for reform is to curb the import of illicit synthetic drugs, such as fentanyl, that unlawfully exploit the exemption.
This is an area where the incoming Trump administration will likely continue President Biden's late-stage push to close the loophole—at least in broad strokes. The Biden administration is releasing a notice of at least one of the proposed rulemakings in the Federal Register on January 14, 2025. Of course, even with the release of the proposed rulemaking, the Trump administration could revise or withdraw it after January 20. In short, the future of de minimis reform now rests with Trump. Here is what is clear: de minimis continues to be a hot-button issue; Trump has been vocal about stopping the flow of fentanyl and other drugs from China; and voices slated for key government positions in the new administration, including Senator Rubio, have historically called for greater restrictions on the use of the de minimis exemption by low-cost Chinese shopping vendors such as Shein and Temu. While the specifics and exact timing are unclear, we recommend keeping a close eye on efforts to reform de minimis this year. This is especially true for e-commerce retailers and other companies that currently use the de minimis exception.
Forced Labor
Import restrictions on forced labor, in particular under the Uyghur Forced Labor Prevention Act (UFLPA), passed in December 2021 have been on many U.S. companies' radar for the last few years, and for good reason. The UFLPA Entity List now includes over a hundred entities, including some that are not located within the Uyghur Autonomous Region in China. As of December 1, 2024, CBP has detained 11,334 shipments, valued at $3.67 billion, and rejected 4,899 of these shipments under the UFLPA. Forced labor will not be leaving the spotlight anytime soon, with President-elect Trump anticipated to continue aggressively enforcing U.S. forced labor laws in 2025. In 2025, we could see a proliferation of new import restrictions and trade actions rooted in forced-labor issues. This past December, the Office of the U.S. Trade Representative (USTR) initiated a Section 301 investigation of Nicaragua for labor rights, human rights, and rule of law abuses. A hearing is expected to be held in the upcoming weeks. This is likely not the only Section 301 investigation based on labor and human rights that we will see under the upcoming administration.
The executive is not the only branch of government to monitor for forced-labor action. Keep an eye on Congress, too, where bipartisan congressional investigations and efforts to pass new forced-labor laws will be brewing.
Supply Chain Resiliency and Domestic Manufacturing
The new administration is expected to maintain a hardline stance on China in 2025 and focus on supporting nearshoring, supply chain resiliency, and domestic manufacturing capabilities for U.S. companies. The administration is anticipated to also take other actions to insulate domestic supply chains, including by negotiating with the government of Mexico to prevent Chinese entities from manufacturing products in Mexico for import into the United States.
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Venable's International Trade and Logistics Group has deep practical experience in customs matters (inbound and outbound), trade compliance, tariffs, customs brokerages, foreign trade zones (FTZs), and related issues, and is carefully monitoring legal and regulatory developments in these areas for 2025. If you have any questions, please reach out to the authors for guidance.