An overhaul of the EU customs framework isn’t deterring expansion of UK-to-Europe retail supply chains, writes Andrew Scanlon (pictured, below), Head of Sales and Marketing at e-commerce logistics provider Paxon.
The European Council and the European Parliament recently agreed on reform that will collect customs duties more efficiently and tighten controls on non-compliant, dangerous or unsafe products. It’s a move that’s been regarded as the EU’s greatest customs reform since the creation of the Customs Union in 1968 and has seen headlines about a crackdown on low-value parcels entering Europe.
Changes are expected to see the end of duty relief on parcels valued at less than €150 entering the EU, with this being replaced by new fees. However, there is much more to the reform, with significant changes potentially encouraging, rather than deterring UK businesses from exporting to the EU. Our experience suggests this is the case, with retailers and brands keen to plan early and adapt supply chains to grow sales among European shoppers.
Facilitating trade
The new EU customs framework will see the introduction of a data hub, which is scheduled to become operational for e-commerce goods on 1 July 2028. A phased rollout will bring all movements of goods into its scope by 1 March 2034. The EU customs data hub will be a single online platform for collecting and analysing customs data, supporting the secure and efficient movements of goods into and out of the EU. A new, decentralised agency for EU customs will utilise the hub to help identify the riskiest cargo, flagging this for inspection.
Businesses will submit customs information to the new portal, meaning they only submit information once, rather than up to 27 individual entries for each of the Union’s member states. This should help facilitate and simplify trade by saving exporters time and money. It will also create opportunity for ‘trust and check traders’ – a new process that streamlines customs obligations for companies that consistently provide comprehensive information about their goods. Companies recognised under the scheme could find they are able to release goods into the EU without any active customs intervention at all.
Benefits of the new reform appeal to UK-based retailers and brands, which want to cut the complexities of cross-border trade. Businesses are seeking advice to improve the accuracy and compliance of customs declarations, ensuring they’ve got tried and tested processes in place well ahead of the changes.
It’s the new rules for small consignments that are more likely to be causing concern among UK businesses exporting to the EU.
Changing fees
In December 2025, EU member states agreed to eliminate the customs duty relief threshold for goods valued at less than €150 entering the EU. From 1 July 2026, there are plans to replace this exemption with a temporary customs duty, which is expected to be around €3 per item, in parcels valued up to €150. A new flat rate handling fee has also been proposed, with plans for this to be introduced from November 2026, although this is still to be confirmed.
In the most recent communication (26th March) from the European Council and the European Parliament, it was indicated that the level of the handling fee will be decided by Commission delegated act, before it starts being applied by EU member states no later than 1 November 2026.
Communications further indicated that platforms and those selling into the EU by distance sale (e.g. via e-commerce) are expected to be responsible for ensuring that all customs formalities and payments are taken care of. A new system of financial penalties will be introduced for e-commerce operators systematically failing to comply with their customs obligations.
Although further clarity about the new EU-wide handling fee is still required, UK companies are acting early. They are reviewing fulfilment strategies, considering options such as dual-entity warehousing and EU-based bonded warehouses, as well as hybrid models of centralised supply chain planning and inventory management, supported by regional distribution hubs.
The EU presents a strong growth opportunity for UK-based retailers and brands. European e-commerce is thriving and shoppers are willing to buy from outside the EU – around a quarter (27%) of shoppers did so in 2024. The new customs reform may sound daunting but can present opportunities to streamline exports and fulfilment. Planning early will be key to adapting supply chain and fulfilment strategies that enable effective cross-border trading.
Andrew Scanlon is Head of Sales and Marketing at Paxon – a newly formed third-party logistics brand created by bringing together three specialist providers: Active Ants, Staci and Radial.
