How to Claim Section 321 for Your Ecommerce Shipment (2024)

Now more than ever before, ecommerce businesses are prioritizing minimizing logistics costs to maximize revenue. But keeping costs down while shipping products from overseas can be a huge challenge because of costly customs, import duties, and taxes.

Optimizing your ecommerce supply chain, saving on costs, and complying with the laws and regulations placed by the US Customs and Border Protection can seem like an impossible task. But that’s where Section 321 can help.

Section 321 allows low-value shipments to bypass taxes and duties, making it more affordable to ship products to the US.

In this guide, we’ll dive into how Section 321 works, how you can use it to your advantage, and how ShipBob can help.

Note: This article is solely for informational purposes and does not constitute legal advice.

What is Section 321?

Section 321 is a US Customs and Border Protection (CBP) Shipment Type that allows goods to clear through US customs tax and duty-free. The section exempts low-value shipments from taxes and duties as long as the shipment complies with the de minimis threshold of $800 or less.

With Section 321, goods below the de minimis value can surpass duties and taxes at import into the US and simplify the customs process with less paperwork. Not only does Section 321 help businesses reduce international shipping costs, but it also speeds up the cross-border shipping process.

For these reasons, Section 321 can give ecommerce businesses a competitive edge and reclaim revenue previously spent on taxes and duties.

3 things you should know about Section 321 for ecommerce

Part of the Tariff Act of 1930, Section 321 helps ecommerce businesses save on importing costs for shipping products to the US. While brands can bypass taxes and duties and their shipments receive clearance quicker with less paperwork, it’s a nuanced program with complex guidelines and regulations.

Here are some rules and conditions that apply to Section 321 that you should be aware of.

1. US customs laws and regulations

There are various laws and regulations you should be familiar with when leveraging Section 321. For example, there is a duty exemption for goods produced at less than $800 in fair retail value in the country of shipment. Additionally, there is also a list of goods that are restricted by the administrative ruling, which includes:

• Products that require customs inspection (such as harsh chemicals or cleaning supplies).
• Goods that fall under the Countervailing or Anti-Dumping Duty.
• Products that are regulated by certain government agencies, including FSIS, USDA, NHTSA, CPSA, or the FDA.
• Cigarettes, cigars, and alcoholic beverages.

You also must provide proof of items’ retail value, and every shipment must have consignee names and addresses.

In recent years, the de minimis threshold was amended from $200 to $800 by the Trade Facilitation and Trade Enforcement Act of 2015 (TFTEA).

If your goods are higher than $800 USD, Section 321 may not be the best fit for you. Instead, consider Delivered Duties Paid (DDP) shipping to provide or in-country fulfillment.

2. Imports from China

The United States and China have been at odds when it comes to economic trade. “301 China” or “Section 301” are US-specific import duties placed on goods that have China as the country of origin.

This section has cost importers billions of dollars in taxes and has increased tariffs on a wide range products such as food and beverages, household items, sporting goods, and personal care items.

Fortunately, Section 321 overrides Section 301 as long as the items being shipped meet the de minimis value.

3. Limited to one shipment per day

By taking appropriate administrative and logistical measures, businesses can transport low-value shipments across the US border for minimal cost.

However, businesses must abide by the daily Section 321 restrictions. As part of this program, only one shipment per person (i.e., the brand or company) per day. To avoid serious penalties, make sure that your carrier or freight shipping partner does not make multiple Section 321 claims on the same day.

Section 321 can help benefit your ecommerce shop

If you want to store inventory with a third-party logistics (3PL) company with US-based fulfillment centers, Section 321 allows you to save significantly on importing expenses, which ultimately reduces international fulfillment costs. Here are some of the other benefits of Section 321.

1. Overall lower costs

Section 321 provides ecommerce businesses with the opportunity to manufacture their products overseas and have them imported into the United States duty and tax-free. As mentioned earlier, if you manufacture low-value items in China, your shipment might qualify to be exempt from Section 301 tariffs.

2. Faster shipments

Although you will need proof of value, Section 321 reduces the amount of paperwork required to import products and receive clearance for them across the border.

Using the electronic filling system, eManifest, allows for faster processing, significantly speeds up the shipping process, and eliminates delays caused by shipments held up at customs.This means that customers receive their orders more quickly.

3. Offers a competitive edge

Saving on international shipping costs can help you launch into the US more affordably and offer better shipping rates for US-based customers. For instance, if you bulk ship products to a 3PL’s fulfillment center in the US, you can start shipping products to US customer domestically, which reduces shipping costs and last-mile delivery times.

How ShipBob can help with Section 321 & all customs requirements

Saving on costs is just as important for your business as gaining revenue. Understanding international shipping and trade laws, such as Section 321, can help you cut back on costly duties and fees and ultimately save you money.

ShipBob offers Section 321 from our warehouses in Canada and Mexico. You can maximize revenue and keep logistics costs down by importing your inventory into our Section 321-compliant warehouses, where we’ll ship orders directly to your US customers.

If you choose to leverage our non-bonded warehouse in Toronto, Canada, you pay Canadian duties upon entry and then file a duty drawback to recoup the costs. If you choose to unlock Section 321 fulfillment from our bonded warehouse in Tijuana, Mexico, you never pay duties to bring your inventory into Mexico.

Not sure which option is best for you? Our team of Section 321 experts can help you decide which strategy is best for your brand and your customers.

But ShipBob can help your brand with more than just Section 321 fulfillment. ShipBob has numerous capabilities that can help your brand scale internationally and save on fulfillment costs.

ShipBob partners with brands across the globe

Cross-border shipping is complex, but you don’t have to navigate it alone. ShipBob is an international fulfillment provider that partners with brands across the globe.

If Section 321 isn’t for your brand, that’s okay! We have international shipping capabilities that can help you reach your customers, no matter where they’re located. ShipBob can ship internationally to over 250 destinations around the globe.

Additionally, ShipBob offers Delivered Duties Paid (DDP) shipping options from our US and UK fulfillment centers, allowing you to offer customers a smooth, duty-free delivery experience.

Unlock access to an exclusive international fulfillment network

ShipBob has a global fulfillment network of over 50 fulfillment centers in the United States, Canada, Europe, the United Kingdom, and Australia.

We offer best-in-class ecommerce fulfillment and shipping services so that you can reach customers around the globe seamlessly.

“ShipBob is the right system for a brand that wants to scale across the world. Having inventory in different countries but only one dashboard and point of contact simplifies the process of global expansion.”

The IZIMINI team

Get started with Section 321 fulfillment with ShipBob by requesting a pricing quote below.