The Biden-Harris administration has announced it’s proposing to take regulatory actions to cut down on what it describes as “overuse and abuse” of a trade loophole, with senior administration officials saying they’re concerned about how e-commerce giants Temu and Shein have relied on the loophole.

As per the official statement from the White House on Friday, the de minimis exemption, which allows goods valued at $800 or less to enter the U.S. duty-free, has seen "increased abuse" over the past decade.

Shares of Temu parent company PDD Holdings (PDD) fell on Friday morning after the Biden administration targeted Chinese retailers' alleged abuse of a US trade loophole. Alibaba (BABA) and JD.com (JD) shares are also under pressure,