Supply Chain Research

Retailers and other companies are using the “first-sale” rule, a legal loophole introduced in 1988, to reduce the burden from U.S. tariffs on Chinese exports. That involves shipping first to Mexico and then onward to the U.S. This works particularly well for companies that ship a high volume of low per-piece value items and may include breaking consignments down or applying minor transformations. Industries and companies that are using the first-sale rule can be seen where their imports from China and exports to the U.S. for a given tariff-line are at similar levels. Panjiva’s analysis i...