EU changes to parcel rules could benefit European retailers

Philipp Muehlbauer, CEO of The Customization Group, raised awareness of a major change in European Union duties that could benefit local providers. In the LinkedIn post, Muehlbauer commended the EU for swiftly moving to close a decade-long loophole that impacted European commerce. KPMG provides a succinct overview here.

On July 1, the EU will remove the de minimis customs duty exemption and impose a temporary customs duty of EUR 3 per item until 1 July 2028.

Muehlbauer writes that the move levels the playing field between European service providers and overseas suppliers.

“That ‘per item’ detail is the part people miss,” he said. “A single book? €3. But that ‘cheap’ personalized set from a third country, say cards, envelopes, and a topper, is three different item types: €3 + €3 + €3, plus  €2 per parcel = €11 extra before VAT. Suddenly, it isn’t cheap at all. The scale of what this fixes: in 2024, 4.6 billion parcels under €150 entered the EU, 𝗼𝘃𝗲𝗿 𝟵𝟬% 𝗳𝗿𝗼𝗺 𝗖𝗵𝗶𝗻𝗮, the engine behind Temu, Shein and AliExpress.”

“For years, a European maker paid VAT, labor, safety, and environmental costs that a parcel shipped directly from a third country simply didn’t. That’s not competition. It’s a structural gap, and the EU is finally closing it.”