Global Courant
In this photo illustration, a Shein app is shown in the IOS App Store on May 03, 2021 in Bargteheide, Germany.
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WASHINGTON — A House of Representatives committee investigating economic competition between the US and China released a damning report Thursday linking retail giants Shein and Temu with a disproportionate number of import violations.
China’s e-commerce companies are exploiting trade loopholes to import goods into the US without paying import duties or subjecting shipments to human rights assessments, according to findings released by the House Select Committee of the Chinese Communist Party.
The report found that the brands, which get most of their customer base from social media, are likely responsible for more than 30% of the packages shipped to the U.S. every day under a so-called de minimis provision of Section 321 of the Tariff Act of 1930. which waives import tariffs if the fair retail value of the shipment does not exceed $800. Imports accounted for nearly 600,000 shipments per day last year and are likely higher now, according to the findings.
Lawmakers claim the tariff violations give Temu and Shein unfair advantages over US retailers. Temu’s valuation is estimated at over $100 billion, while Shein was recently valued at $64 billion.
The report, which is a continuation of that of the committee research on forced Uyghur labor issues which began with a May letter campaign to Nike, Adidas, Shein and Temu, is the first record of these findings, according to the committee. Temu is operated by the Chinese parent company Pinduoduo.
Both companies have faced allegations of human rights violations: Shein for alleged forced labor at its suppliers’ factories in the Uyghur region and Temu for alleged negligence in developing compliance with the Uyghur law for the prevention of forced labour, reported the committee.
In addition to the reduced rates, lawmakers say the loophole also allows the companies to provide less comprehensive data to U.S. Customs and Border Control — including UFLPA compliance screening — due to the large number of small packages worth less than $ 800.
“These results are shocking: Temu is doing next to nothing to keep its supply chains free of slave labor,” Mike Gallagher, a Wisconsin Republican and chairman of the House CCP Committee, said in a statement. “Temu and Shein are simultaneously building empires around the de minimis loophole in our import regulations — dodging import taxes and evading scrutiny over the millions of goods they sell to Americans.”
Temu and Shein did not immediately return a request for comment on the report. Temu has previously said it is “not the importer of record with respect to goods shipped to the United States,” and Shein has denied allegations of forced labor.
Temu has asked its more than 80,000 Chinese suppliers to accept language that prevents the shipment of forced-labor-made goods to the US, but has taken few steps to address the tariff violations beyond standard language, the lawmaker said.
American retailers, meanwhile, pay millions in import duties each year. Clothing brand Hole paid $700 million in import duties in 2022, H&M paid $205 million and wedding retailer David’s Bridal paid more than $17 million that year, according to the report.
The commission’s investigation is still ongoing.
(TagsToTranslate)US Economy
