According to the EU’s Economic Commissioner Paolo Gentiloni, the new proposal of the EU Commission for a customs reform is set to be the biggest since the founding of the Customs Union in 1968. The concept is focused on a new European Union Customs Authority and a new EU Customs Data Hub. In addition, it includes plans for new regulations for goods traded online and for smaller consignments that are currently exempt from customs duties, most of which are to be made subject to customs duties. By using AI, among other things, the Commission also wants to make import monitoring processes more efficient and harmonize them.
The proposed new EU Customs Data Hub is intended to gradually replace the existing independent systems of the bloc’s member states. According to the Commission, this could save the EU members up to two billion euros a year. Above all, this might also improve information exchange between member states – today, one country’s authorities often know little about illegal goods that customs officials in another country have identified and intercepted.
The new platform is also expected to bring benefits for companies: It could provide companies with a single place to submit details of their products and supply chains. According to the Commission, authorities will then be able to view this information on the platform. The platform is intended to be maintained by the newly established EU Customs Authority, which, according to the EU Commission’s plans, will also support the member states, for example in risk assessment and coordination.
//“This far‑reaching reform will reduce red tape and compliance costs for businesses, create more transparency and certainty for EU citizens when shopping online, and introduce simpler and innovative processes for the authorities.”
Gentiloni Paolo, Economic Commissioner of the EU
Specifically for online trade, the Commission wants to introduce further changes that could particularly affect imports of smaller consignments and shopping with suppliers outside of the European Union. For example, e‑commerce platforms might in future be expected to act as the main parties responsible for ensuring that all customs obligations are met. While this is currently the responsibility of consumers, the platforms would then have to ensure that customs duties and VAT are already paid at the time of purchase. This is also intended to avoid hidden additional costs for customers.
However, the suggestion to eliminate the customs threshold for small consignments is attracting some of the most attention. According to the EU Commission, the current threshold, according to which goods with a value of less than 150 euros are duty‑free, is often exploited by fraudsters. These would simply declare a value that is too low or divide a shipment into several smaller consignments in order to be supposedly under the 150‑euro limit. The EU Commission estimates that currently, up to 65% of such goods imported into the EU are declared with too low a value.
The proposals on e‑commerce and small consignments could have some important implications for companies’ brand protection activities. For example, a recent study by EUIPO and OECD suggested that counterfeit trade on the web is increasing massively – already back in 2017 to 2019, around half of all seized counterfeit imports were related to e‑commerce, it said. Postal shipments also play a key role when looking at the number of seizures by transport route – as illustrated by another EUIPO and OECD analysis from 2021. At that time, this study, among others, called for more modern risk analysis, e.g. through electronic manifests.
The EU Commission’s proposal will now be discussed by national governments and the European Parliament. They then have to find a common stance before a reform can be implemented.
