On March 22, the Wisconsin Republican Congressman, who chairs the Select Committee on Chinese Communist Party, announced that he would retire from Congress on the 19th of April after the primaries on April 2 instead of the end of the current Congress session. He did much more than ensure that Republicans could not replace him by the start of January.
His work on Chinese online retailer Temu Shein was not completed.
Michael J. Gallagher is a member of the House Committee on Fast Fashion & the Uyghur Genocide. He released the interim results from the committee’s report “Fast Fashion & the Uyghur Genocide”, at the release event on June 23, 2006.
Temu has shifted its position in the last 10 months since the publication of the report.
Atlanta First News investigated Temu and found that nobody had heard of Temu until they moved to Boston. PDD Holdings relocated the headquarters of their parent company from Delaware.
A native of Green Bay, Wisconsin, said Chinese e-retailers built their businesses on a loophole.
The Marine veteran from Iraq stated, “Temu and Shein, at the same time are building empires based on the de minimis gap in our import regulations–avoiding import taxes and evading the scrutiny of the millions of products they sell to Americans.” “We need to pay close attention to this loophole that is being used by American companies to manipulate the game in their favor.”
In 1938, the “de minimus” rule was implemented to allow Americans traveling abroad to bring home souvenirs or knickknacks from their trip without having to pay the usual tariffs on imports.
In 2015, Congress raised the threshold for tax-free purchases from $200 to $850. Temu & Shien were not concerned about the $800 tax-free threshold at the time. The COVID-19 outbreak in 2015 sparked a boom in online shopping. Some of the dresses cost as low as $15.
According to the report:
Findings 1: Temu and Shein, together with their teams, are responsible for more than 30 percent of all packages sent from China each day to the United States using the de minimis provisions. They also account for nearly half of total de minimis shipments to the U.S.
The loophole in import tax allows packages to arrive at residences without having to pay tax.
Temu’s parent company PDD Holdings reported a profit in the 4th Quarter Financial Report filed on March 21, 2013.
ChiCom Committee report: Temu Tax exemption clears the path, but there is no need to declare slave labor.
Gallagher’s committee has linked de minimus import taxes and slave labor:
Key Finding #2: Temu’s business model relies heavily on de minimis clauses to avoid the responsibility of compliance with UFLPA and other prohibitions against forced labor. It also relies on tens or even thousands of Chinese suppliers that ship directly to U.S. clients.
The Uyghur Forced Labor Prevent Act requires the Homeland Security Department’s Forced Labor Enforcement Task Force to maintain a list of entities in violation. The Xinjiang Zhongtai Group Co. Ltd. was added to this list in September.
Temu failed to meet the reporting requirements of the legislation intended to punish entities who exploit Uyghurs.
Temu has not reported any audits, or compliance systems that would check and confirm compliance with UFLPA. Temu only took one measure to make sure it did not ship to American goods produced with forced labor in violation of U.S. law.
The investigators of the committee also found that Temu did not comply with restrictions on trade placed in Uyghur-populated areas.
Key Finding 4: Temu admitted that it did not “expressly prevent third-party sellers from selling products based on their origin in the Xinjiang Autonomous Region”. ”
ChiComs, like Temu, collects data from its users.
TemuShein, as with all Chinese companies that collect information from American clients and share it with the Chinese Communist Party, also shares the data.
25 conducted an investigation of its own on Temu. The Boston Fox Channel also reported on the story. 25 conducted its investigation into Temu.
The Boston Channel reported on the Boston lawsuit filed by local law firm Hagens Berman. A class-action lawsuit was filed Nov. 3 in Chicago federal courts on behalf of 12 plaintiffs, including at least five states. It was amended on February 16.
I have been fascinated for a long time by the way ChiComs takes advantage of our open society to gather as much information as possible.
In May 2010, I went on a tour at Fort Bragg, North Carolina with the XVIII Airborne Corps Public Affairs. One Special Forces Master Sergeant told that one-third of Facebook accounts had been compromised by a replica of the profile page. ChiCom spy software was located in the space between the mock-up page and the profile page.
The master sergeant informed me that all USB devices were made in China and they all had spyware. Digital frames that play a series of images one after the other are included.
It’s been more than a decade since my master sergeant first warned me of Chinese exploitation of American consumer goods.
Looking back, I expected so much more. I recall the excitement surrounding the launch of the committee. Gallagher’s visit to Taiwan. And the arrest of Chinese nationals in New York running a ChiCom.
I can see that Gallagher is no longer at the company, but Temu still avoids import tariffs and uses slave labor.
