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Dear Valued FacFox Customer,<\/p>\n
We’re writing to inform you about recent significant changes in US trade policy regarding imports from China, which may affect orders shipped to the United States and potentially impact material costs globally.<\/p>\n
We understand these changes can be concerning, and we want to transparently explain the situation and the solutions we are implementing at FacFox.<\/p>\n
Recent adjustments to US tariff policies, particularly concerning goods imported from China, have introduced new considerations for international shipments and manufacturing:<\/p>\n
Effective 12:01 a.m. Eastern Daylight Time (EDT) on May 2, 2025<\/strong><\/span>, this $800 de minimis exemption is eliminated for goods originating from the People’s Republic of China (PRC) and Hong Kong. This elimination of the de minimis exemption applies comprehensively to all goods valued at $800 or less originating from China or Hong Kong, irrespective of whether they are shipped via international postal services (e.g., China Post\/EMS handled by USPS)<\/strong> or commercial carriers (e.g., FedEx, DHL, UPS)<\/strong>.<\/p><\/blockquote>\n\t\t
\n\t\t\t\n\t\t\t\t<\/i>\n\t\t\t<\/div>\n\t\t\t\n\t\t\t\tTo summarize: For any shipment from China to the US regardless of declared values, import tariffs will apply, estimated tariff rate is 145-170% of the declared value.<\/strong><\/span>\t\t\t<\/div>\n\t\t<\/div>\n\t<\/span>\n\n
- Postal Shipments (e.g., China Post\/EMS shipping via USPS):<\/strong>
\nFor goods valued at $800 or less shipped through the international postal network, the carrier transporting the goods is responsible for collecting and remitting duties to US Customs and Border Protection (CBP). The carrier must elect one of the following two methods for duty calculation:<\/p>\n\n
- Method 1:<\/strong> An ad valorem duty rate of 120%<\/span><\/strong> applied to the declared value of the postal item containing the goods. This rate underwent several upward revisions from an initial proposal of 30% in early April 2025.<\/li>\n
- Method 2:<\/strong> A specific, flat-rate duty per postal item containing goods<\/strong>. This rate is set at $100 effective May 2,2025<\/strong><\/span>, and is scheduled to increase to $200 effective June 1, 2025<\/strong><\/span>. Similar to the ad valorem rate, this per-item fee was also significantly increased from initial proposals.<\/li>\n<\/ul>\n
A critical point for these low-value postal shipments is that the applicable 120% duty OR the $100\/$200 fee is applied in lieu<\/strong> of any other duties, such as Section 301 tariffs, IEEPA tariffs, or Reciprocal tariffs, that might otherwise be applicable to the goods. However, CBP maintains the discretion to require a more complex formal entry process for any postal package, regardless of value.<\/li>\n
- Non-Postal Shipments (e.g., Commercial Carriers like FedEx, DHL, UPS, Freight Forwarders):<\/strong>
\nShipments arriving via commercial carriers, including those valued at $800 or less that previously qualified for de minimis, are now subject to all applicable duties, taxes, and fees under standard US import procedures. This shift means that multiple layers of tariffs can potentially apply cumulatively (“stack”) to the same imported item. The potential layers include:<\/p>\n\n
- Base Duty<\/span> Rate (0-10%)<\/span>:<\/strong> The standard Most-Favored Nation (MFN) duty rate specified in the Harmonized Tariff Schedule of the United States (HTSUS) for the particular product classification. \t\t
\n\t\t\t\n\t\t\t\t<\/i>\n\t\t\t<\/div>\n\t\t\t\n\t\t\t\tBase duty rate varies by product, you can check rates of your product with official HTS lookup tools<\/a>.\t\t\t<\/div>\n\t\t<\/div>\n\t<\/span><\/li>\n- Section 301 Tariffs (0-25%)<\/span>:<\/strong> Additional tariffs imposed on extensive lists of products originating from China, stemming from investigations into technology transfer and intellectual property practices. Current rates typically range from 7.5% to 25%<\/strong> for most affected goods, although some items face higher rates. Many goods commonly manufactured by FacFox, such as items made of plastic (HTS Chapter 39) or machinery and parts (HTS Chapters 84, 85), are included in these Section 301 lists. While some product-specific exclusions from Section 301 tariffs exist, they are limited in scope and subject to change or expiration.\t\t
\n\t\t\t\n\t\t\t\t<\/i>\n\t\t\t<\/div>\n\t\t\t\n\t\t\t\tTo check Section 301 tariff rates, refer to this article:\u00a0 How to Navigate the Section 301 Tariff Process | United States Trade Representative<\/a> \t\t\t<\/div>\n\t\t<\/div>\n\t<\/span><\/li>\n- IEEPA “Fentanyl” Tariff (20%)<\/span>:<\/strong> An additional 20%<\/strong> ad valorem duty broadly applied to goods imported from China and Hong Kong, implemented under the International Emergency Economic Powers Act (IEEPA) effective March 4, 2025.<\/li>\n
- Reciprocal Tariff (125%)<\/span>:<\/strong> A further additional 125%<\/strong> ad valorem duty broadly applied to goods imported from China, Hong Kong, and Macau, implemented effective April 10, 2025, also under IEEPA authority. Certain product categories, such as semiconductors, cell phones, and specific electronics, have been granted exclusions from this particular tariff layer.<\/li>\n<\/ul>\n
The cumulative effect of these “stacked” tariffs for non-postal shipments can be substantial. For example, a typical FacFox manufactured item subject to a 20% IEEPA tariff<\/strong>, 0-25% Section 301 tariff<\/strong> and the 125% Reciprocal tariff<\/strong> would face a total additional duty burden of 145%-170%<\/span> (20% + (0-25%) + 125%)<\/strong>, plus any applicable base HTS duty rate<\/strong><\/span>. This calculation confirms that initial concerns about tariffs potentially reaching around 150% are a realistic reflection of the potential impact for many non-postal shipments subject to all applicable layers.<\/li>\n<\/ul>\n
\n\n
\n \n\n \n \n \n <\/colgroup>\n \n \n Policy Area<\/strong><\/p>\n<\/td>\n
\n Previous Rule<\/strong><\/p>\n<\/td>\n
\n New Rule (Effective May 2, 2025)<\/strong><\/p>\n<\/td>\n
\n Primary Impact for US Imports<\/strong><\/p>\n<\/td>\n
\n FacFox Action\/Note<\/strong><\/p>\n<\/td>\n<\/tr>\n
\n \n De Minimis Threshold<\/p>\n<\/td>\n
\n $800 Duty-Free (Sec 321)<\/p>\n<\/td>\n
\n Eliminated for China\/HK origins 1<\/span><\/p>\n<\/td>\n
\n Mandatory Duties on all shipments<\/p>\n<\/td>\n
\n Implement Tariff Deposit System<\/p>\n<\/td>\n<\/tr>\n
\n \n Entry Process (<$800)<\/p>\n<\/td>\n
\n Entry Type 86 (Simple\/Fast)<\/p>\n<\/td>\n
\n Informal\/Formal Entry (Type 11\/01; More Complex) 1<\/span><\/p>\n<\/td>\n
\n Delays, Increased Admin Burden<\/p>\n<\/td>\n
Collect Deposit Based on Declared Value, Monitor Logistics, Advise Customers<\/td>\n<\/tr>\n \n \n Postal Duties (<$800)<\/p>\n<\/td>\n
\n $0<\/p>\n<\/td>\n
\n 120% Duty OR $100 Fee (rising to $200 June 1) – In lieu of other tariffs 1<\/span><\/p>\n<\/td>\n
\n Increased Cost (Postal Method)<\/p>\n<\/td>\n
\n Collect Deposit Based on Declared Value<\/p>\n<\/td>\n<\/tr>\n
\n \n Non-Postal Duties (<$800)<\/p>\n<\/td>\n
\n $0<\/p>\n<\/td>\n
\n All Applicable Tariffs Stacked (Base + Sec 301 + 20% IEEPA + 125% Reciprocal = potentially ~170%+) 1<\/span><\/p>\n<\/td>\n
\n Potentially Very High Costs (Non-Postal Method)<\/p>\n<\/td>\n
\n Collect Deposit Based on Declared Value (150% buffer)<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n
Potential Delivery Delays for US Customers<\/h2>\n\t\t
\n\t\t\t\n\t\t\t\t<\/i>\n\t\t\t<\/div>\n\t\t\t\n\t\t\t\tThe elimination of the de minimis exemption brings significant changes to the customs clearance process, which are expected to impact delivery timelines.\t\t\t<\/div>\n\t\t<\/div>\n\t<\/span>\nThe streamlined “Entry Type 86” clearance process, specifically designed for the efficient processing of low-value de minimis shipments, is no longer permitted for goods originating from China and Hong Kong, effective May 2, 2025.<\/p>\n
Consequently, all shipments, including those valued below the previous $800 threshold, must now be cleared using more complex standard entry procedures:<\/p>\n
\n
- Informal Entry (Type 11):<\/strong> Generally used for shipments valued between $800 and $2,500, this process will now apply to many shipments previously eligible for Type 86. It requires more detailed data submission than Type 86.<\/li>\n
- Formal Entry (Type 01):<\/strong> Required for shipments valued over $2,500 and may be mandated by CBP for any shipment regardless of value.\u00a0This is the most complex entry type, typically necessitating the services of a licensed customs broker.<\/li>\n<\/ul>\n
Both informal and formal entries demand significantly more data than the previous Type 86 process. This includes the precise 10-digit HTSUS classification code for each item, detailed product descriptions, accurate valuation, quantity, country of origin verification, and complete shipper\/consignee information. Generally, entries must be filed electronically through CBP’s Automated Commercial Environment (ACE) system; paper submissions are typically not accepted.<\/p>\n
Potential Material Cost Increases (Global Impact)<\/h2>\n\t\t
\n\t\t\t\n\t\t\t\t<\/i>\n\t\t\t<\/div>\n\t\t\t\n\t\t\t\tReciprocal tariffs imposed by China on goods imported from the US could affect the cost of certain materials we use for manufacturing.\t\t\t<\/div>\n\t\t<\/div>\n\t<\/span>\nWhile we strive to absorb fluctuations, materials sourced from specific US-based suppliers (e.g., certain resins or powders from companies like 3D Systems, Formlabs, Stratasys, Markforged<\/strong>) might see price adjustments. This could potentially affect pricing for customers globally, not just in the US.<\/p>\n
Increased Administrative Complexity & Customs Scrutiny<\/h2>\n
The implementation of new tariff rules and declaration requirements will likely lead to more intensive customs clearance procedures<\/strong>. Navigating the new tariff codes, declaration requirements, and additional tariff payment processes adds complexity for both importers and exporters.<\/p>\n
Our\u00a0Solutions to Mitigate Impacts<\/h1>\n
FacFox is committed to minimizing disruption and providing clarity during this transition. Here\u2019s how we are adapting:<\/p>\n
\n\n
\n \n\n \n \n \n <\/colgroup>\n \n \n Option<\/strong><\/p>\n<\/td>\n
\n Description<\/strong><\/p>\n<\/td>\n
\n Potential Benefit<\/strong><\/p>\n<\/td>\n
\n Key Risks \/ Considerations<\/strong><\/p>\n<\/td>\n
\n FacFox Recommendation<\/strong><\/p>\n<\/td>\n<\/tr>\n
\n \n Declare Actual Value<\/p>\n<\/td>\n
\n Use the true transaction price for customs declaration.<\/p>\n<\/td>\n
\n Legally compliant (19 USC 1401a), lowest penalty risk, fulfills “reasonable care”.34<\/span><\/p>\n<\/td>\n
\n Requires payment of full applicable duties based on this value.<\/p>\n<\/td>\n
\n Strongly Recommended for Compliance.<\/p>\n<\/td>\n<\/tr>\n
\n \n Customer-Defined Value<\/p>\n<\/td>\n
\n Customer inputs a value they determine.<\/p>\n<\/td>\n
\n May result in lower upfront deposit and potentially lower duties if undetected.<\/p>\n<\/td>\n
\n RISK: Illegal undervaluation (19 USC 1592).<\/strong> Customer (Importer) faces penalties (fines potentially exceeding duties saved, seizure).36<\/span> FacFox offers no guarantee\/protection. Customer bears full liability.<\/p>\n<\/td>\n
\n Use ONLY with full acceptance of significant legal and financial risks.<\/p>\n<\/td>\n<\/tr>\n
\n \n Prototype Program (HTS 9817.85.01)<\/p>\n<\/td>\n
\n Attempt duty-free entry for qualifying prototypes upon request.<\/p>\n<\/td>\n
\n Potential full duty savings if approved and used correctly.<\/p>\n<\/td>\n
\n Strict eligibility: Exclusive use for testing\/dev, NO SALE allowed (except scrap post-use).42<\/span> 3-year CBP audit risk.40<\/span> Deposit still required by FacFox as safeguard. Cannot be used if AD\/CVD applies.45<\/span><\/p>\n<\/td>\n
\n Viable only for items meeting all strict CBP criteria. Confirm eligibility before selecting.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n
Flexible Declared Value Options<\/h2>\n\t\t
\n\t\t\t\n\t\t\t\t<\/i>\n\t\t\t<\/div>\n\t\t\t\n\t\t\t\tWe will introduce options during checkout allowing you to select your preferred declared value for customs purposes<\/strong>. You can choose to declare the actual value or input a different, reasonable value<\/strong>.\t\t\t<\/div>\n\t\t<\/div>\n\t<\/span>\n\t\t\n\t\t\t\n\t\t\t\t<\/i>\n\t\t\t<\/div>\n\t\t\t\n\t\t\t\tPlease note: Declaring a value lower than the actual transaction value is a complex area with potential risks, and we cannot guarantee acceptance by customs authorities.\t\t\t<\/div>\n\t\t<\/div>\n\t<\/span>\nTariff Deposit System<\/h2>\n\t\t
\n\t\t\t\n\t\t\t\t<\/i>\n\t\t\t<\/div>\n\t\t\t\n\t\t\t\tTo streamline the process and avoid unexpected charges upon delivery, we will collect a deposit equivalent to 170% of the declared value<\/strong><\/span> at the time of order.\t\t\t<\/div>\n\t\t<\/div>\n\t<\/span>\nThis deposit will be used to cover the assessed import tariffs. Once the final tariff amount is confirmed, we will promptly process any necessary refunds or contact you if additional payment is required.<\/p>\n
Prototyping Declaration Program (HTS 9817.85.01)<\/h2>\n\t\t
\n\t\t\t\n\t\t\t\t<\/i>\n\t\t\t<\/div>\n\t\t\t\n\t\t\t\tFor orders genuinely intended for prototyping purposes (exclusively for development, testing, product evaluation, or quality control), we will attempt to declare the goods under the potentially duty-free HTS code 9817.85.01<\/a>.\t\t\t<\/div>\n\t\t<\/div>\n\t<\/span>\n\t\t