China’s creative tariff evasion efforts in spotlight once again: Chinese suppliers and manufacturers have been attempting to exploit a loophole in the US customs system that allows them to undervalue their products and the dues levied on them in a bid to avoid President Donald Trump’s tariffs, according to offers seen by Financial Times. The loophole — known as delivery duties paid (DDP) — allows the exporting Chinese company to cover customs duties on behalf of small US companies before selling the merchandise in the US at an altered, undervalued price.

The impact? While it is too early to determine how common this practice is, more Chinese exporters are increasingly reaching out with offers to pay the duties to American businesses, some of which face the difficult choice of either going out of business due to tariffs or colluding in the practice, the FT reports. The practice is also notoriously difficult to police, which threatens Trump’s efforts to push US companies to source more products domestically, FT reports.

Not China’s first rodeo: Some Chinese exporters are reportedly disguising products as Korean-made in a bid to evade the US tariffs, which prompted an effort by South Korea’s customs to crack down on the practice last month. The Korea Customs Service has identified nearly KRW 29.5 bn (USD 21 mn) worth of goods falsely marked as being of South Korean origin, some 97% of which were US-bound.

IN OTHER RELATED NEWS- US President Donald Trump has officially closed another loophole — called the de minimus rule — that allowed Chinese firms to avoid tariffs, the New York Times reported on Friday. The rule — which exempted shipments below USD 800 — has been leveraged by some Chinese firms, which used Mexico as a transit point to break down big cargo into small packages before shipping to the US. The official move comes two months after Trump first announced the US would work on blocking the practice.

Bad news for logistics players in the US: Firms that handle large volumes of packages from China to the US, such as UPS, FedEx, and DHL, are set to be deprived of a major source of revenues, New York Times reports. UPS — whose China-US route is its most profitable — said it could lose up to 25% of its 2Q revenue this year as a result. Airlines that mainly carry cargo and smaller logistics companies will also be impacted.

HD Hyundai and Danish shipping giant Maersk are partnering up on decarbonization technology and integrated logistics services, according to a press release. The two firms have inked an MoU that will see them leverage HD Hyundai’s HiNAS and OCEANWISE navigation and route optimization systems on Maersk vessels to assess their greenhouse gas emission reductions. HD Hyundai will also leverage Maersk’s capabilities across its East-West network, airfreight services, land transportation, and warehousing infrastructure to strengthen its global supply chains.

There’s more: The companies will jointly research the viability of Solid Oxide Fuel Cell (SOFC) systems, a new technology viewed as a non-fossil fuel candidate that could help decarbonize maritime shipping. The pair will also explore collaboration on ship retrofitting, with a focus on retrofits optimizing engine efficiency, increasing cargo capacity, and installing dual-fuel propulsion systems.

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