The United States has charged 38 countries, along with the European Union, with being involved in a “shadow transshipment network.” This network allegedly allows Chinese goods, which are subject to steep U.S. tariffs, to enter the American market via third-party nations. A report titled “The Great Transshipment Scam” estimates that this potentially illicit transshipment could be valued at approximately $60 billion, causing significant losses in U.S. tariff revenue.

The report names a wide range of countries and territories as participants in this network, including India, Canada, the European Union, Israel, Japan, and Mexico. Others listed are South Korea, Taiwan, Brazil, Indonesia, Malaysia, Thailand, Turkey, Vietnam, Argentina, and Azerbaijan, among others. According to this report, an estimated $67 billion worth of goods destined for the U.S. were allegedly rerouted from China through major hubs like Mexico, India, and Vietnam in 2025. This practice is believed to have resulted in about $28 billion in lost tariff revenue for the U.S.

Highlighting specific regions, the report points to the Pune-Gujarat-Chennai corridor in India as a notable example. It claims that Chinese shipments of products such as electric pumps and compressors have bolstered businesses in this area, all while increasing competitive pressure on American manufacturers.

In response to these findings, the United States is considering a range of measures. These include implementing stricter inspections and interdictions, introducing additional tariffs, and imposing sanctions. Furthermore, the U.S. may consider restricting market access for countries that are found to facilitate this form of tariff evasion.