The end of De Minimis. What it means for DAP and DDP shipping to the US

If the US is an important market for your brand, there’s a major regulatory change you cannot afford to ignore. On 29 August 2025, the long-standing de minimis rule will be removed. With it goes the ability to ship low-value orders to US customers duty-free.

This change affects every business shipping into the US, from fast-growing DTC brands to established multinationals. The days of frictionless, duty-free deliveries are ending, and the way you handle shipping terms, specifically DAP (Delivered at Place) and DDP (Delivered Duty Paid), will determine how smoothly your brand navigates this shift.

In this article 

• What was the de minimis rule? 

• What’s changing from August 2025? 

• What’s possible and what isn’t: DAP vs DDP  

• Options for brands under DDP and the trade-offs 

• Preparing for long-term growth in the US 

What was the de minimis rule? 

The de minimis exception allowed shipments valued at USD $800 or less to enter the US without incurring duties. It was last raised from $200 to $800 in 2015, making it particularly attractive for cross-border ecommerce. 

For brands, this meant faster customs clearance, no additional costs for customers at delivery, and a smoother and more competitive buying experience. It’s no exaggeration to say that de minimis helped fuel the growth of global ecommerce into the US.

What’s changing from August 2025? 

On 30th July 2025, the White House announced the suspension of the de minimis exemption. With the executive order signed, the de minimis exemption will be eliminated. From 29 August 2025: 

• No more duty-free threshold. Every shipment, regardless of value, will be subject to tariffs. 
  
• Country of manufacture is decisive. Duties are applied based on where goods are produced, not shipped from. 
  
• Pre-payment is mandatory. US Customs will not release goods unless duties have already been paid. 
  
• For the first six months, postal shipments (e.g. via USPS) may face fixed specific duties (around $80–$200 per item) before transitioning to standard ad valorem tariffs. For commercial carrier shipments, full duties apply immediately. 

This isn’t just a policy tweak. It fundamentally reshapes how goods enter the US, and it makes DDP the only practical path forward for most brands. 

A quick note on ad valorem tariffs vs. specific duties 

When the de minimis exemption disappears, all shipments into the US will face tariffs.  

• Ad valorem tariffs. Calculated as a percentage of the product’s customs value. For example, a 15% ad valorem tariff on a $100 item equals $15 in duties. Commercial carrier shipments (UPS, FedEx, DHL, etc.) will immediately be charged ad valorem tariffs.   
  
  

• Specific duties. A fixed fee per unit or per shipment, regardless of value (e.g. $2 per item). Postal shipments (USPS) will temporarily face specific duties per item for the first 6 months, before moving to ad valorem tariffs as well. 

The shift to ad valorem tariffs means higher-value goods will carry proportionally higher duties; something brands will need to factor into pricing and margin planning. 

What’s possible and what isn’t: DAP vs DDP    

For brands, the choice between DAP and DDP has always been about balancing convenience, cost and customer experience. With the removal of de minimis, that balance shifts significantly – the decision is now very clear. 

Options for brands under DDP 

Switching to DDP solves the compliance issue, though it raises a new question. Who ultimately pays the duty? You have three main strategies to consider. Each strategy has merit. There’s no universal best option. Your choice depends on customer expectations, margin profile and growth priorities. 

1. Absorb the cost - Duties are paid/absorbed by your business, leaving your customers with a simple, predictable checkout price. This protects conversion rates and keeps the buying experience seamless. The trade-off is reduced margins, unless offset by efficiencies elsewhere. 
   
   
2. Add a duty calculator at checkout - Duties are shown and collected upfront, alongside product and shipping costs. Customers see the landed cost before purchasing, which builds trust. Transparency is high, but so is the risk of checkout abandonment if duties appear unexpectedly steep. 
   
   
3. Build duties into product pricing - You increase retail prices by a set percentage to cover average duty costs. Checkout stays clean, but you risk higher prices compared to competitors and potential margin pressure.
    

Preparing for long-term growth in the US 

If the US represents a significant growth market, a short-term DDP strategy may not be enough. Many brands are now considering localising fulfilment in the US. For scale-up brands, this approach can protect margins, improve customer satisfaction, and make US expansion more sustainable.   

By holding inventory stateside, you can: 

• Pay duties at the wholesale cost. When you import bulk shipments, duties are calculated on cost price, not retail price. 
• Remove customer surprises. Fees are handled upfront, and customers pay a simple retail price with no add-ons at delivery.
• Accelerate delivery times. With fulfilment centres on both coasts, shipping becomes faster and often cheaper. 

The removal of de minimis is one of the most significant changes to US import rules in years. While it creates new complexity, it also levels the playing field. Brands that act early by adopting DDP, adjusting pricing strategies and exploring US fulfilment will protect margins and maintain customer trust. 

The key takeaway is that DAP is no longer viable. For brands shipping to the US, DDP is the path forward. How you implement it will determine not just compliance, but also your competitiveness in the world’s largest consumer market.