In July of 2025, President Donald Trump signed into law the long-awaited One Big Beautiful Bill Act.[1] This Bill was subject to considerable political controversy due to its widespread effects on taxation, healthcare, retirement, and other sweeping categories.[2] Section 70531(b) specifically affected a long-standing exemption to international trade policy by putting a complete and total end to the de minimis exemption.[3] When President Trump eliminated de minimis exceptions for China and Hong Kong via executive order, this revision expanded what Trump began in May of 2025.[4] The main purpose of eliminating this trade concession was to prevent contraband and counterfeit goods from entering the country.[5] While the elimination of this exemption will certainly have an effect on the entry of physical contraband, there is a broader, underlying national security benefit to eliminating this international trade provision.

Within the past decade, Chinese e-commerce has generated a considerable demand and presented a substantial burden on U.S. customs.[6] The data shows a generous majority of Americans have purchased exported goods from the Chinese marketplace, with many Americans purchasing from well-known international sellers like Temu, Shein, TikTok Shop, and AliExpress.[7] Recently, there has been an increased demand for goods from these e-commerce sellers, and this demand has caused undue strain at U.S. points of entry with the total number of de minimis shipments exceeding 1.36 billion in 2024 alone.[8] Such an overwhelming volume originates from a previous allotted value increase under the exemption from $200 to $800 per shipment, which was implemented close to a decade before eliminating the exemption in its entirety.[9]

Such a high volume of shipments presented several challenges for United States border security. The high quantity of shipments under the de minimis exemption have caused less scrutiny imposed at the points of entry, and less security has allowed narcotics, counterfeit goods, and other hazardous or illicit items to flood into the country.[10] Along with an exponential increase in shipment volume, diminished security screenings have resulted from short staffing at points of entry, despite severe risk presented through contraband, disease, weapons, and counterfeit goods.[11] Preventing entry of these harmful items was the predominant justification for eliminating the de minimis exemption.[12]

Despite these real and immediate challenges threatening American prosperity, a broader threat to American data and economic welfare has also found traction in the de minimis exemption. Many Chinese e-commerce companies have sought to undercut the United States market on consumer goods, often offering household products at prices well below the domestic market value.[13] Many of these companies have faced scrutiny for unethical business practices, intellectual property violations, and sustainability concerns, but there is an additional growing concern for consumer data protection and the risks created by supporting these sellers.[14]

For instance, Shein relies on user data and artificial intelligence to discern preferences and patterns, which in turn are used to manufacture and deliver products ahead of other competitors.[15] While this gives Shein a competitive edge in the market, the company has poorly handled consumer data and exposed the personal information of 39 million accounts.[16] Temu has had similar issues when its parent company, PDD holdings, incorporated invasive malware into other mobile applications that gleaned private messages, changed security settings, and viewed data from other applications.[17] TikTok and its parent company ByteDance have also faced pushback for sweeping data collection, a lack of transparency in data management, and the risk that the data collected could be used by the Chinese government.[18]

Notwithstanding aggressive data collection and poor data protection practices, the greatest concern consists of the Chinese state’s looming power over Chinese e-commerce companies. Throughout the last decade, the Chinese Communist Party (CCP) has set forth several data collection policies.[19] These policies require the installation of backdoors in software, the disclosure of stored data to the People’s Republic of China (PRC), the expansion of the CCP’s access to data, and the assistance of organizations in counterespionage operations.[20]

Such negligent supervision and data mismanagement has led to serious international scrutiny. An Australian advocacy group recently filed suit over failure to comply with data transparency as requested by users.[21] The European Union has expressed similar concerns over data integrity and levied a $620 million fine against TikTok for failing to properly secure customer data and failing to accurately represent data protection measures.[22] In 2025, the U.S. Department of Education even launched investigations into academia, stating that China seeks to leverage technology research and subsequent data to undermine U.S. national security.[23]

U.S. officials have exhibited longstanding concerns over data breaches, spanning from recent legal action against TikTok to earlier concerns over consumer technology manufacturers like Huawei, Xiaomi, and ZTE.[24] There are four primary concerns identified through Chinese data management: (1) espionage and data security risks, (2) the influence of political campaigns, (3) cyber-attacks on infrastructure and government operations, or (4) the potential for physical attacks.[25] Concerns with private information databases involve Chinese national security laws, which give the state power to compel companies to surrender any information requested in the name of national security.[26]

The threat to American data is a bi-partisan issue only partially addressed through a “patchwork of executive actions and politicized bans” that have failed to adequately address a broader vulnerability issue.[27] The United States has nevertheless made notable progress to address data security issues by identifying threats, limiting data and technology infiltration, and working to reduce the influence of Chinese e-commerce companies.[28] However, American foreign data policies still require substantial revision, and comparison to our European allies shows that we need to implement broader data protections for consumers.[29] The elimination of the de minimis exemption provided a rapid, economic deterrent to the influence exerted over the United States by companies seeking to undercut the domestic market for consumer goods and exploit the privacy of Americans.[30]

[1] See Brandon Drenon & Nadine Yousif, What are the Key Items in Trump’s Sprawling Budget Bill?, BBC (July 4, 2025), https://www.bbc.com/news/articles/c0eqpz23l9jo; see also Jordan Carney & Meredith Lee Hill, Trump: Megabill’s Name ‘not Good for Explaining’ what it Does, Politico (Aug. 26, 2025), https://www.politico.com/news/2025/08/26/trump-megabills-name-not-good-for-explaining-what-it-does-00527379 (showing the bill titled as the “one big, beautiful bill” and “One Big Beautiful Bill Act”).

[2] Id.

[3] One Big Beautiful Bill Act of 2025, Pub. L. No. 119-21, 139 Stat. 283.

[4] See Executive Order – Tariff on De Minimis Shipments from China, U.S. Customs & Border Prot. (Nov. 4, 2025), https://www.help.cbp.gov/s/article/Article-1915.

[5] See Fact Sheet: President Donald J. Trump is Protecting the United States’ National Security and Economy by Suspending the De Minimis Exemption for Commercial Shipments Globally, the white house (July 30, 2025), https://www.whitehouse.gov/fact-sheets/2025/07/fact-sheet-president-donald-j-trump-is-protecting-the-united-states-national-security-and-economy-by-suspending-the-de-minimis-exemption-for-commercial-shipments-globally/ (showing that the main goal of eliminating the exemption was to stop fentanyl, contraband, and other illicit drugs and materials from entering America).

[6] Id.

[7] See 70% of Americans Have Shopped at Temu, Shein, or Other Chinese Marketplaces in the Past Year, 1 in 5 Shop There at Least Once a Week, Omnisend (June 11, 2024), https://www.omnisend.com/latest-news/70-of-americans-have-shopped-at-temu-shein-or-other-chinese-marketplaces-in-the-past-year-1-in-5-shop-there-at-least-once-a-week/.

[8] See CBP Proposes New Rule to Strengthen Enforcement and Limit Duty Exemption for Low-Value Shipments, U.S. Customs & Border Prot. (Jan. 17, 2025), https://www.cbp.gov/newsroom/national-media-release/cbp-proposes-new-rule-strengthen-enforcement-and-limit-duty.

[9] Elena Patel, Small Parcels, Big Problems: Modernizing De Minimis in a Global Economy, Brookings (Aug. 28, 2025), https://www.brookings.edu/articles/small-parcels-big-problems-modernizing-de-minimis-in-a-global-economy/.

[10] Executive Order – Tariff on De Minimis Shipments from China, supra, at Note 5.

[11] Marcy Mason, Buyer Beware: Bad Actors Exploit De Minimis Shipments, U.S. Customs & Border Prot. (Aug. 26, 2025), https://www.cbp.gov/frontline/buyer-beware-bad-actors-exploit-de-minimis-shipments.

[12] Executive Order – Tariff on De Minimis Shipments from China, supra, at Note 5.

[13] See Minhelle Toh & Nathaniel Meyersohn, ‘Too Good to be True?’ As Shein and Temu Take off, so Does the Scrutiny, CNN (Apr. 24, 2023), https://www.cnn.com/2023/04/23/tech/temu-shein-us-concerns-intl-hnk.

[14] Nicholas Kaufman, Issue Brief: Shein, Temu, and Chinese E-commerce: Data Risks, Sourcing Violations, and Trade Loopholes, U.S. China Econ. Sec. Rev. Comm’n (Apr. 14, 2023), https://www.uscc.gov/sites/default/files/2023-04/Issue_Brief-Shein_Temu_and_Chinese_E-Commerce.pdf.

[15] Id.

[16] Id.

[17] Id.

[18] Eric Baerren, What are the Main Security Concerns Surrounding TikTok?, Cent. Mich. Univ. (Mar. 12, 2025), https://www.cmich.edu/news/details/what-are-the-main-security-concerns-surrounding-tiktok.

[19] See The Chinese Communist Party (CCP): A Quest for Data Control, Ctr. Internet Sec. (Aug. 14, 2024), https://www.cisecurity.org/insights/blog/the-chinese-communist-party-ccp-a-quest-for-data-control.

[20] Id.

[21] See Privacy Group Files Complaint Against AliExpress, TikTok and WeChat, Reuters (July 17, 2025), https://www.reuters.com/sustainability/boards-policy-regulation/privacy-group-files-complaint-against-aliexpress-tiktok-wechat-2025-07-17/.

[22] See Kelvin Chan, TikTok Faces Fresh European Privacy Investigation over China Data Transfers, AP (July 10, 2025), https://apnews.com/article/tiktok-european-union-data-privacy-gdpr-5f1dcb8187a1c90c1ea10c287beb06f2.

[23] William Ferreira, et al., U.S. Academic and Research Institutions Face Mounting Scrutiny Over China Ties, Hogan Lovells (Sept. 4, 2025) https://www.hoganlovells.com/en/publications/us-academic-and-research-institutions-face-mounting-scrutiny-over-china-ties.

[24] See Peter Harrell, Managing the Risks of China’s Access to U.S. Data and Control of Software and Connected Technology, Carnegie Endowment for Int’s Peace (January 30, 2025), https://carnegieendowment.org/research/2025/01/managing-the-risks-of-chinas-access-to-us-data-and-control-of-software-and-connected-technology?lang=en.

[25] Id.

[26] Id.

[27] Samm Sacks & Graham Webster, Address Data Security Risks from China with Comprehensive Legislation, John Hopkins School Advanced Int’l Studies (Feb. 2025), https://acf.sais.jhu.edu/address-data-security-risks-china-comprehensive-legislation.html.

[28] Id.

[29] Id.

[30] See Casey Hall & Lisa Barrington, End of Tax-Free Loophole for Low-Value Goods Disrupts Air Shipments to US from China, Reuters (July 4, 2025), https://www.reuters.com/business/autos-transportation/end-tax-free-loophole-low-value-goods-disrupts-air-shipments-us-china-2025-07-04/.