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Forever 21 says 'de minimis' exemption used by Shein and Temu is partly responsible for its second bankruptcy


Published on 2025-03-17 23:42:49 - Insider
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  • Forever 21 said it can't compete with e-commerce companies that send small packages without paying tariffs via the "de minimis" exemption.

Forever 21 has attributed part of its second bankruptcy filing to the competitive disadvantage created by the de minimis exemption, which allows companies like Shein and Temu to import goods into the U.S. without paying import duties or taxes if the shipment value is under $800. This loophole enables these fast-fashion rivals to offer significantly lower prices, impacting Forever 21's market position. The company argues that this exemption, originally intended for small, individual shipments, is now being exploited by large e-commerce platforms, leading to an uneven playing field in the retail sector. This situation has contributed to Forever 21's financial struggles, prompting its recent bankruptcy filing as it seeks to restructure and adapt to the changing retail landscape.

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[ https://www.msn.com/en-us/money/economy/forever-21-says-de-minimis-exemption-used-by-shein-and-temu-is-partly-responsible-for-its-second-bankruptcy/ar-AA1B6bH3 ]