UPS has suspended its money-back guarantee for all international deliveries bound for the U.S., the carrier announced on its website.
The suspension of UPS' "Service Guarantee," which took effect Oct. 2, is due to a heightened risk of import delays stemming from the United States' elimination of the de minimis exemption, the company said. The change affects several UPS services, including Worldwide Express and Worldwide Saver.
The de minimis exemption allowed imports of less than $800 to enter the U.S. duty and tax free until the Trump administration ended the long-running trade tool on Aug. 29. The exemption's demise has spurred concerns of delays ahead of the peak holiday shipping season by introducing new customs complexities for cross-border parcel shippers, such as compliance with formal entry procedures.
"This change has resulted in a substantial rise of formal customs clearances, which has led to increased processing times and delays," UPS said of de minimis' end in a service alert for Canada shippers.
Imports involving other U.S. government agencies, such as the Food and Drug Administration, are particularly vulnerable to slowdowns, the company added.
The end of de minimis continues to challenge both shippers and carriers as they adjust their processes for an overhauled trade environment. Lululemon is exploring tweaks to its de minimis-reliant supply chain, and international postal operators are moving to restart U.S.-bound services after initially halting them when the trade tool ended.
UPS suspending its service guarantee during tumultuous supply chain conditions isn't uncharted territory. The company occasionally enacts restrictions on its money-back guarantee coverage in instances of disruption.
During the COVID-19 pandemic, UPS suspended guarantees for several products, such as its 2nd Day Air A.M. service. More recently, ongoing Canada Post disruptions led the carrier to halt its service refund for all Canada domestic and import offerings, a suspension that remains in place today.
