Regulators in South Africa are investigating whether fast-fashion company Shein’s import practices have given an unfair advantage to the company founded in China but now based in Singapore. The Wall Street Journal reports the issues raised in South Africa resemble complaints in the U.S. that Shein and other Chinese retailers are using an exception in U.S. customs law to import goods without paying tariffs.
South African groups say Shein deliberately sends its goods in small packages of lesser value to reduce import duties aimed at protecting local businesses. It is a sign that customs laws aren’t necessarily matching the growth in e-commerce capabilities.
The law known as the de minimis rule allows American tourists to bring back souvenirs from overseas duty-free and is now being used by companies to avoid paying billions of dollars in tariffs.
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