In a pivotal decision taken on 13 November 2024, EU finance ministers agreed to eliminate the exemption on duty for low-value orders, a move that primarily targets the likes of Chinese platforms such as Temu and Shein. This initiative aims to curb the influx of cheap imports flooding the European market, which is becoming increasingly problematic.
Details of the Duty Exemption Removal
Currently, packages valued under €150 (approximately US$174) imported by EU consumers go untaxed. However, the Finance Ministers have accelerated plans to remove this exemption, moving the timeline from 2028 to the start of next year, with the aim to enhance economic sovereignty within the EU.
Impacts of E-commerce Growth
According to EU trade spokesman Olof Gill, the demand for online shopping has surged, leading to an astonishing 4.6 billion parcels imported to the EU last year alone. Such exponential growth raises concerns about product safety and regulatory compliance, making it essential for timely intervention.
Reactions to the Decision
French Finance Minister Roland Lescure welcomed the development, stating, “This is a key step for the protection of European consumers…” He emphasised the importance of creating a safer internal market as it pertains to European regulations.
A Temporary Solution in Motion
Alongside the exemption’s removal, the EU’s proposal includes introducing a small package handling fee of €2, with hopes of implementation by late 2026. However, some member states like Romania aren’t waiting for collective agreement and have already instated their own fees, with Romania charging €5 for small parcels.
The Road Ahead
As member states continue negotiations, the proposal will be further discussed during the upcoming finance ministers’ meeting scheduled for 12 December 2024. This ongoing dialogue will determine the specifics of the customs fee and the necessary IT frameworks to support these changes.
With the rise of e-commerce reshaping the retail landscape, the EU’s actions signify an essential step towards not just protecting consumers but also stabilising the internal market.