Shein is participating in a U.S. government pilot program designed to speed up low-cost ecommerce deliveries while preventing illegal or hazardous goods from slipping through customs.

Earlier this year, Shein voluntarily joined the U.S. Customs and Border Protection (CBP) Section 321 Data Pilot, an initiative aimed at increasing visibility around small-value shipments. The program tests whether online marketplaces, carriers, and others can help CBP identify and target high-risk shipments for inspection while streamlining the clearance of legitimate goods.

The move comes amid growing scrutiny from U.S. lawmakers over Shein’s reliance on a trade provision that’s driven an influx of low-cost shipments from China. Along with rival Temu and others, Shein benefits from Section 321 of the U.S. Tariff Act of 1930, commonly known as the de minimis rule.

The provision allows individuals to import goods worth up to $800 per day with fewer reporting requirements and no duties and taxes. While this streamlines entry for low-value packages, it also makes it easier for illegal products — like counterfeits and narcotics — to slip through.

By joining the CBP Section 321 Data Pilot, Shein signals an effort to address transparency and compliance concerns as lawmakers debate potential reforms to the rule. The fast-fashion platform said it backs reforms to the de minimis exemption, calling for “a level, transparent playing field” where rules are applied evenly across the industry.

“Shein makes import compliance a top priority, including the reporting requirements under U.S. law with respect to de minimis entries,” a Shein spokesperson told Digital Commerce 360 by email.

Shein is No. 2 in Digital Commerce 360’s Asia Database ranking ecommerce retailers in the region by online sales. The online apparel retailer was valued at $66 billion in May 2023 when it closed its latest funding round.

Inside the Section 321 Data Pilot Program

Driven by ecommerce growth, de minimis shipments now make up 92% of all cargo entering the U.S.

And that number continues to climb. According to CBP, the agency processes around 4 million of these small-value shipments daily. That’s an increase from 2.8 million a year ago.

A 2023 briefing from the U.S. International Trade Commission revealed that most of these imports come from China. Shein and Temu together represented more than 30% of de minimis imports into the U.S. in 2022, the report said.

In 2019, CBP launched the Section 321 Data Pilot with nine voluntary participants, including Amazon, eBay, Zulily, and others. It intended to “effectively identify and target high-risk shipments” that fall under the de minimis rule.

Participants in the pilot share extra data points about parcels — such as seller information, product photos, and other shipment details. The added visibility helps CBP flag high-risk shipments while expediting compliant ones, reducing delays for the agency and participating businesses.

In February 2023, CBP expanded the program after seeing improvements in shipment risk assessments, fewer holds, and smoother processing.

Shein officially announced its participation in the pilot on Dec. 19, 2024. After its first 30 days in the program, CBP confirmed Shein’s shipment data was processed without any technical issues or delays.

“Our participation in CBP’s Section 321 Data Pilot reaffirms Shein’s standards of transparency and compliance,” said Donald Tang, executive chairman at Shein, in a statement. “By disclosing more details about the contents of each package, we can help ease CBP’s burdens so they can focus on maintaining the efficient flow of legitimate trade, while protecting public safety, the U.S. economy, and importantly — American consumers.”

Biden administration pushes for de minimis reform

CBP has said there’s no limit on how many companies can join the program, which runs until August 2025 unless extended. Shein said it plans to remain in the Section 321 Data Pilot until its conclusion.

In September, the Biden-Harris administration proposed new rules aimed at curbing what it described as “abuse” of the de minimis exemption, particularly among China-founded ecommerce platforms, which include Temu and Shein. According to the White House, annual shipments claiming the exemption have surged from 140 million to over 1 billion in the past decade.

The proposed rules would exclude shipments subject to Section 301, Section 232, and Section 201 tariffs — targeting products from China, steel, and more — from de minimis benefits. These shipments would instead face tariffs, heightened inspections, and standard freight reporting requirements, bringing them in line with larger freight imports.

Shein has expressed willingness to collaborate on trade reform. In a letter to the American Apparel & Footwear Association dated July 2023, Tang called for a “complete makeover” of the de minimis exemption.

“Shein believes the de minimis framework should be reformed to create a more level, transparent playing field — one where all retailers play by the same rules, and where the rules are applied evenly and equally, regardless of where a company is based or ships from,” Tang said.

Supply chain and pricing pressures loom

Losing tariff-free access would likely force Shein to raise prices and/or invest heavily in overhauling its supply chain.

A second Trump administration could intensify these pressures. President-elect Donald Trump, known for his hawkish stance on trade with China, has previously imposed steep tariffs on Chinese imports and has floated plans to raise them again — potentially as high as 60%. Such tariffs could significantly impact China’s export-dependent industries and, by extension, global players like Shein.

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