New US Regulation: Squid, Cuttlefish & Octopus Classified as Shellfish to Simplify Import & Export Procedures

Baby Cuttlefish (Sepia esculenta) — Easyseafood

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1. Core Policy & Effective Date

The U.S. Fish and Wildlife Service (FWS) has officially released a regulatory amendment that categorizes cephalopods including squid, cuttlefish and octopus under the federal definition of "shellfish". The new rule will formally take effect on July 23, 2026.

The revision aims to resolve long-standing regulatory ambiguity, eliminate duplicate inspections and multi-channel declarations during import and export, cut compliance costs for domestic U.S. cephalopod businesses and boost the global competitiveness of the sector.

U.S. authorities estimate this single reclassification will save small and medium seafood enterprises nationwide at least USD 2.8 million in compliance expenses annually.

2. Background: Cephalopods Trapped in Regulatory Gray Area for Years

The change fixes loopholes in the original definition of shellfish under the Fish and Wildlife Regulations. The old rule defined shellfish merely as "aquatic invertebrates with hard outer shells". Squid and cuttlefish only have internal shells while octopuses barely possess any shell, leaving their classification undefined by law and triggering regulatory conflicts:

1. During customs declaration and inspection, cephalopod products were regulated both as ordinary fisheries catch and wildlife;

2. Companies faced duplicate paperwork, extra rounds of inspections and additional administrative fees;

3. Most commercially harvested seafood was exempt from such redundant procedures, imposing heavy burdens on the industry.

   U.S. squid processors and import & export traders have lobbied regulators for years to push forward this regulatory revision.

3. Industry Feedback: Significant Cost & Time Savings

Wayne Reichle, President of Lund's Fisheries, a leading U.S. squid processor and exporter, spoke highly of the new rule, stating it eliminates years of cumbersome administrative burdens for the whole industry. After implementation, enterprises will see notable improvements in documentation, customs lead time and labor costs.

Industry consensus:

1. Businesses are freed from repeated declarations and inspections caused by ambiguous cephalopod classification, accelerating import and export turnover;

2. Processing plants specializing in squid, cuttlefish and octopus cut operational costs directly, strengthening the price competitiveness of U.S.-produced cephalopods worldwide;

3. Unified clear standards reduce risks of fines and cargo detention stemming from classification confusion.

4. Policy Rationale: Implement Measures to Restore U.S. Seafood Competitiveness

This reclassification is not an isolated policy but a core component of the April 2025 Executive Order "Restoring American Seafood Competitiveness", promoted by the U.S. Small Business Administration (SBA):

1. The Office of Advocacy under SBA participated fully in legislative discussions, absorbing extensive feedback from small fisheries operators to plug regulatory gaps;

2. Supporting reforms are underway: the SBA proposes opening certain marine protected areas to commercial fishing, shifting the cost of at-sea observers to NOAA or abolishing mandatory observer assignments to further ease operational pressure on fisheries;

3. The federal government continues streamlining fisheries supervision to reduce administrative burdens and support domestic seafood development.

5. Benefits for Global Exporters Shipping Cephalopods to the U.S.

As one of the world’s top importers and consumers of cephalopods, the U.S. new rule brings tangible advantages to overseas suppliers:

1. Food safety access standards and quarantine requirements remain unchanged; only customs declaration procedures are simplified with no higher trade barriers;

2. Standardized classification removes institutional trade frictions and lowers risks of cargo detention and inspection delays;

3. Domestic and foreign enterprises exporting squid, cuttlefish and octopus to the U.S. will enjoy faster customs clearance and slightly lower overall export costs.

Closing Summary

The rule effective July 23 puts an end to decades-long classification disputes over cephalopods in the U.S. market. By grouping squid, cuttlefish and octopus into shellfish regulation, overlapping supervision, duplicate charges and redundant inspections are fully resolved. The policy reduces costs for U.S. domestic small seafood processors and traders, while facilitating global cephalopod suppliers conducting business with the United States.

Both Chinese seafood exporters and U.S. domestic processing traders can optimize customs workflows after the rule enters force, cut unnecessary administrative expenditure and seize market opportunities brought by streamlined trade procedures.

Source: Frozen Seafood Insider, Official Announcement of USFWS