There isn't a whole lot of overlap between the politics of Donald Trump and Joe Biden, but one thing they both have appeared to agree on is that something must be done to curb the flow of cheap, duty-free Chinese imports. While Biden got the ball rolling on those changes in the closing days of his presidency, Trump has opted for a much more aggressive approach that could soon send shockwaves through supply chains across the globe.

Current U.S. de minimis requirements allow any individual or business in the U.S. to receive up to $800 in imports per day without paying tariffs, effectively meaning any shipment valued under $800 can enter the country duty-free, with little scrutiny from customs agents. Chinese retailers such as Temu and Shein have taken full advantage of that loophole by shipping millions of small packages direct to consumers in the U.S. each day, and have seen their businesses grow by billions of dollars in a matter of years as a result.

But on February 3, President Trump revoked the U.S. de minimis rule for all imports from China, before reversing course days later and delaying the move until "adequate systems are in place to fully and expediently process and collect tariff revenue." Although it's unclear how long that process might take, it still represented a clear shot across the bow, not just for Temu and Shein, but for any other companies across a variety of industries that rely on the country for cheap manufacturing. 

"We're looking at a complete change to the e-commerce ecosystem," says Ram Ben Tzion, the CEO and co-founder of Publican, which uses artificial intelligence to vet freight shipments by cross-checking data across numerous sources. 

The inroads Temu and Shein have both made in the U.S. have been based on their ability to sell products well below typical market value, thanks in large part to the savings they generate from de minimis exemptions. Take that advantage away, and they could be forced to operate on a fair more level playing field in a growingly competitive e-commerce landscape.

Read More: Will Trump Tariffs Spell the End of Temu, Shein in the U.S.?

On a larger scale, Ben Tzion points out that ending de minimis means more paperwork, longer processing times, and higher costs for everyone from shippers to consumers, all while U.S. Customs and Border Protection (CBP) develops new mechanisms on the fly to charge and collect duties on millions of low-value packages each day. What's more is that those mechanisms don't actually exist at the moment, which was a reality CBP likely encountered in the chaotic handful of days in February during which de minimis was revoked, as packages quickly piled up at customs. 

The National Foreign Trade Council points out that ending de minimis exceptions will not only mean tariff charges accruing, but also processing fees  — as much as $20 and $27.23, respectively, on a typical $50 package. 

"The only reason [the revocation] got canceled in the first place is because they couldn't figure out how to administer it," says Mike Klage, the vice president for freight forwarder NTG Supply Chain Solutions. "I think anyone in the industry probably saw that from the get-go, if they stuck with it, it would have been an absolute disaster."

Klage acknowledges that reforming de minimis is necessary, but executing it properly is a daunting challenge. To start, CBP would need to rapidly expand its workforce, develop complex new IT systems to process shipments and collect tariff revenue, and collaborate with the logistics and transportation industries to establish a functional framework for these changes. Ultimately, Klage has "serious doubts" that the revenues collected from the new duties would even be enough to pay for the added administrative and enforcement costs for the government, especially given that de minimis policies were originally created to reduce the amount of time, effort and money it takes to move smaller shipments through customs.

Eliminating de minimis would also pose significant challenges for delivery giants such as FedEx, UPS, and the USPS. Currently, Klage explains, these services act as the importer of record for de minimis shipments, simply checking a box with customs before delivering the package — no duties owed, no extra costs, and no delays for customers. Without duty-free entry, they would either be responsible for paying the duties themselves, or be forced into a complicated customs process to transfer power of attorney to the end customer, who would then be required to cover the charges instead.

"And that seems like a complete impossibility," he says. "Just start to picture what that looks like from a manpower perspective, and think about all of the angry phone calls FedEx is now going to be getting from individuals all over the country. Then you get shipments that are stuck and can't deliver because there's no power of attorney to make the clearance."

But, that doesn't mean changing de minimis for the better in some way is impossible, says Ben Tzion. He believes that, once the dust settles, a more likely scenario is one where the exemption threshold is reduced from $800 to somewhere around $250, and predicts that, eventually, businesses will adapt as CBP irons out the kinks. Klage adds that any new system would need to "completely rethink the tariff system," while simplifying the process for collecting the duties themselves, removing bureaucratic barriers for delivery services, and taking the necessary time to build out the infrastructure needed to support these systems. 

"I think that's the only way to actually have it generate positive revenue for the government, and to not have commerce grind to a halt," Klage says.