Section 321 of the Tariff Act of 1930 allows CBP to release shipments valued at $800 or less on a duty-free, entry-free basis — one shipment per person per day. For direct-to-consumer e-commerce operations routing through Port Newark and Carteret warehouses, Section 321 can eliminate substantial duty exposure. For high-volume B2B importers, the misapplication of Section 321 creates CBP enforcement risk that directly affects financing availability.
What Section 321 Actually Covers
- Eligible shipments: Articles imported by one person on one day, fair retail value not exceeding $800. No formal entry required. No duties, taxes, or fees assessed.
- Frequency restriction: The $800 threshold applies per person per day. A single buyer cannot receive multiple Section 321 shipments from the same or different importers on the same day that, in aggregate, exceed $800.
- Excluded merchandise: Section 301 tariffs on Chinese-origin goods (verify current CBP guidance as this exclusion has been subject to regulatory change), antidumping duties (ADD), countervailing duties (CVD), and quota-restricted merchandise cannot benefit from Section 321.
2025 enforcement note: Regulations governing Section 321 eligibility for Chinese-origin goods have been subject to change. Verify current CBP guidance with a licensed customs broker before structuring any Section 321 program.
CBP Enforcement at Port Newark: What's Changed
1. Manifest review for structured shipments: CBP algorithms now flag import manifests showing patterns consistent with artificially divided shipments — multiple consignees at the same address, identical SKU descriptions below $800, high-frequency small-value entries from single suppliers.
2. Post-importation audits: CBP has begun conducting post-importation audits on importers with high Section 321 entry volumes, reviewing whether the "one person per day" restriction is being accurately applied.
3. Bonded warehouse scrutiny: Carteret-area bonded warehouse operators have received CBP audit requests related to Section 321 programs.
Enforcement consequence: A finding of Section 321 abuse can result in formal entry requirements being imposed retroactively, penalty assessments, and importer suspension from the ACE system — all of which directly prevent access to institutional trade financing.
Capital Strategy: When Section 321 Helps and When It Hurts
Legitimate Section 321 Use Cases for NJ Importers
- Direct-to-consumer (DTC) brands using Port Newark/Carteret for national distribution of sub-$800 orders
- B2B importers with occasional small-value test orders below $800
- Return-to-origin shipments of sample merchandise
Capital benefit: Eliminating formal entry requirements reduces customs broker fees by $85–$200 per entry and eliminates duty exposure. On a 1,000-unit DTC operation with $750 average order value, that is $85,000–$200,000 in annual savings.
When Section 321 Creates Financing Risk
If your Section 321 program is structured around splitting shipments to avoid duties on higher-value merchandise, CBP enforcement exposure creates contingent liability that institutional lenders will flag in underwriting. Sentinel's pre-financing compliance review includes a Section 321 usage assessment for importers with DTC components.
Clearance Flow: Section 321 vs. Formal Entry at Port Newark
Section 321 clearance flow: Manifest submission → CBP automated release (ACE) → Carrier release → Dray to Carteret → No duty payment
Formal entry flow: ISF filing (24h pre-load) → Vessel arrival → Entry filing (CF-7501) → Duty payment → CBP release → Dray to Carteret
Capital timing difference: Section 321 eliminates the duty payment step — which for a $1M shipment at 25% duty represents $250,000 in working capital that does not need to be deployed at port. Properly structured Section 321 programs are a genuine working capital strategy.
Interactive: PO Stepper — Section 321 Eligibility Checker
Lateral Relevancy
Section 321 compliance is one component of the broader customs compliance picture.
Ready to structure compliant financing around your import model? Initialize your Funding Analysis or call (888) 653-0124.
DISCLAIMER: Sentinel Trade Finance | Carteret, NJ 07008 | (888) 653-0124 | Section 321 rules are subject to regulatory change. Verify current CBP guidance with a licensed customs broker. This content is for informational purposes only and does not constitute customs or legal advice. Financing subject to underwriting and approval.