Section 321 was a provision that allowed low-value shipments valued at $800 or less to enter the U.S. duty-free, simplifying customs processes for many small businesses and international sellers. As of August 29, 2025, this de minimis exemption has been suspended for all countries, meaning all shipments, regardless of value, now require formal customs entry and may be subject to duties and fees.

This change marks a significant shift in U.S. import regulations, impacting ecommerce, cross-border retail, and fulfillment strategies worldwide. Understanding how Section 321 worked and what its suspension means is crucial for businesses navigating the new landscape of U.S. imports.

With the removal of this exemption, importers must prepare for increased customs scrutiny and associated costs. This blog post will explore the implications of the suspension and offer insights to help businesses adapt to the updated trade environment.

Understanding Section 321

The Section 321 allows certain shipments to enter the U.S. without formal customs entry or duties, but has strict conditions. This policy has evolved over time and includes specific terminology and limitations that sellers and importers must understand to benefit effectively from it.

Definition and Purpose

Section 321 is a provision under U.S. Customs and Border Protection (CBP) regulations that permits goods valued under a set de minimis threshold to be imported duty-free. Its primary goal is to facilitate quicker, less costly clearance for low-value shipments, reducing the administrative burden on both importers and CBP.

For many years, the value cap was set at $800, allowing small e-commerce shipments from countries like Canada to enter the U.S. market without incurring customs duties. This exemption aimed to support cross-border trade by making small shipments more competitive and accessible.

Legal Framework and History

Section 321 originates from the Tariff Act of 1930. It has since been adapted to the modern trade environment, especially with the rise of e-commerce. The law permits shipments under the de minimis value to bypass formal customs entry requirements, as long as they meet specific criteria.

Significant changes occurred with the global suspension of the Section 321 exemption in August 2025. This suspension now requires formal entry and duties on all low-value imports into the U.S., regardless of country of origin or shipment route. This shift expands prior restrictions originally focused on China and Hong Kong to all countries.

Key Terms and Concepts

• De minimis value: The maximum shipment value eligible for duty-free entry—previously set at $800.
• Formal customs entry: The process required for higher-value shipments involving paperwork, duties, and taxes.
• Single Entry Limit: Section 321 can be invoked once per day per sender, meaning multiple shipments on the same day may not all qualify.
• Carrier and route independence: Under Section 321, shipments’ eligibility doesn’t depend on shipping method or path.

Understanding these terms helps importers structure shipments to comply and maximize benefits, while noting that exceeding thresholds or frequency limits will trigger duties.

Common Misconceptions

A frequent misunderstanding is that Section 321 applies to all small shipments. In reality, only those below the de minimis value and meeting specific daily limits qualify. For example, a shipment valued at $801 would be denied the duty exemption entirely.

Another misconception is that the policy still offers broad duty-free entry. The recent global suspension means no shipments now qualify under Section 321, increasing customs requirements and costs for all low-value imports.

Finally, some believe bundling shipments defeats the purpose. However, strategic bundling respecting value and daily limits can optimize cost savings while maintaining compliance.

Section 321 Compliance and Procedures

Section 321 allows for importing low-value shipments without formal customs entry or duties under specific conditions. Understanding the eligibility, proper documentation, and the associated benefits and limitations is essential for businesses to stay compliant and optimize operations.

Eligibility Requirements

To qualify under Section 321, shipments must have a value below the de minimis threshold set by customs, historically $800 in the U.S., but this program was suspended after August 29, 2025. The goods must be imported by individuals or entities, not for resale purposes, and meet safety and security standards.

Certain commodities are excluded, including alcohol, tobacco, and some controlled products. Importers need to verify the classification and adherence to restrictions before shipping. Failure to meet these criteria requires formal entry, duties, and taxes.

Compliance with updated trade rules and correct HS codes is critical. Businesses should audit their shipments regularly to ensure they fit eligibility since non-compliance leads to fines or delays.

Documentation and Filing Process

Section 321 shipments require accurate submission of shipment information before arrival at the border. This includes details like shipper and recipient data, item descriptions, and value declarations.

The U.S. Automated Commercial Environment (ACE) system supports this process for better visibility. Carriers or customs brokers usually handle documentation filing to ensure all legal and safety information is reported correctly.

Proper data management is essential to prevent delays or penalties. Even with the program suspended, understanding the filing steps is helpful for future compliance with similar low-value entry processes.

Businesses must maintain records of all declarations and supporting documents to comply with audits or inspections.

Benefits and Limitations

Section 321 offers cost savings by eliminating formal entry fees, duties, and taxes on qualifying low-value goods. This reduces administrative burdens and speeds up customs clearance.

It is especially beneficial for high-volume, low-value shipments common in e-commerce and cross-border trade. Integrating Section 321 into a fulfillment model can reduce logistics costs significantly.

However, the program’s suspension after August 29, 2025, means all shipments now require formal entry, increasing shipping costs and administrative tasks.

Limitations include strict eligibility rules, mandatory accurate data submission, and the exclusion of certain product categories, which restrict the program’s use for some businesses.