Effective 1 July, the EU abolishes the customs duty relief previously available for low-value consignments. Under the current regime, goods with an intrinsic value of EUR 150 or less could enter the EU without payment of customs duty. The vast majority of e-commerce parcels benefit from this relief.
However, the volume of parcels entering the EU has surged dramatically in recent years, reaching nearly 6 billion in 2025 alone, placing unsustainable pressure on customs authorities. Compliance checks have revealed widespread failure by online sellers to adhere to EU product safety and regulatory standards.
In response, the EU now eliminates the low-value consignment relief and imposed stricter obligations on online marketplaces and sellers to ensure a level playing field and protect consumers. The UK is thinking of a similar abolishment of the duty relief for consignments valued up to GBP 135, though current announcements refer to a date of March 2029 (at the latest). In the U.S., the de minimis exemption for consignments valued up to USD 800 is currently suspended.
From 1 July, a flat-rate customs duty of EUR 3 will be levied per item in each business-to-consumer consignment with a value not exceeding EUR 150 entering the EU. Although the precise definition of “item” remains subject to ongoing discussion (for example, two identical t-shirts within a single consignment would be treated as one item), this measure will materially increase the cost for EU consumers purchasing goods online from non-EU sellers.
For shipments to commercial buyers, the flat-rate duty will not apply; instead, these imports will be subject to the applicable rates under the Common Customs Tariff, consistent with the regime that governs all other imports into the EU. In addition, no later than 1 November, the newly introduced Union Handling Fee will apply to all business-to-consumer consignments, regardless of their value. The fee is designed to cover the costs incurred by customs authorities in conducting controls on small parcels. While the final amount has not yet been determined, initial indications suggest a charge in the region of EUR 2 per item. Together with the flat-rate duty, this fee will further increase the landed cost of goods purchased by EU consumers from outside the EU.
Both measures raise significant questions under international trade law. The interim flat-rate duty of EUR 3 will be charged even on products that are otherwise subject to a zero-percent tariff under the Common Customs Tariff. Moreover, consignments declared through the VAT Import One Stop Shop will not be eligible for preferential tariff treatment that would otherwise eliminate the EUR 3 charge; a provision that materially disadvantages businesses (including SMEs) in the United Kingdom, Türkiye, and other EU trading partners with existing preferential arrangements. As for the Union Handling Fee, although it is framed as a cost-recovery mechanism, the underlying costs it purports to cover have not been clearly identified or quantified. Taken together, there are substantial grounds to question whether the flat-rate duty and the Union Handling Fee are consistent with the EU’s obligations under international trade agreements. Much of the legal justification advanced for these measures appears to have been reverse-engineered to support what are, at their core, politically motivated decisions to put a halt to cross-border e-commerce. Rather than deriving the policy from established legal principles, the EU appears to have settled on the desired outcome and then constructed the legal rationale after the fact. It is only a matter of time before these measures face a formal challenge.
The changes on 1 July also fundamentally shift customs liability. From 1 July, the end consumer will no longer be the party liable to customs for low-value consignments. Instead, liability will fall on the marketplace, online seller, and/or logistics operator handling the shipment.
This is a consequential change: in cases of non-compliance at scale, these economic operators will bear liability that may extend years beyond the date of importation. We therefore expect enforcement activity not only in the near term, which could lead to operational disruption with parcels stuck at the border, but also over the longer horizon, as EU customs authorities begin conducting retrospective data audits on imports from 1 July 2026 onward.
The European Commission is clearly anticipating efforts to circumvent the new regime and has introduced a dedicated anti-avoidance provision aimed at preventing operators from consolidating individual parcels into larger consignments to avoid payment of the flat-rate duty.
The pace of implementation has been remarkably swift by EU standards, and this speed has come at a cost: significant uncertainty remains for all stakeholders. Portions of the legal package have yet to be officially published, although adopted versions of the relevant texts are already circulating among practitioners. Given the technical complexity of both the underlying subject matter and the regulatory changes themselves, many economic operators remain unprepared. Significant confusion on and after 1 July appears likely.
The package introduces enhanced customs declaration requirements, most notably the obligation to declare product identifiers at the time of importation, which places considerable burden on the parties involved in cross-border e-commerce. While product identifiers may already exist for goods in commerce today, integrating that data into customs declarations requires significant system modifications to ensure the information flows to the appropriate parties at each stage of the supply chain.
Given the compressed implementation timeline, operators have very limited time to design, test, and deploy these changes before the new requirements take effect. Customs authorities, for their part, face the additional challenge of implementing the necessary system changes within an extremely compressed timeline, historically a source of operational disruption in its own right.
These measures are only the precursor to a far broader overhaul of EU customs legislation, with the aim of tightening the screws at the EU’s external border. A comprehensive EU Customs Reform, which reached political agreement at the end of March, will establish an entirely new Union Customs Code.
The official publication of the new Code is expected after the summer. The reform will introduce substantive changes extending well beyond e-commerce, affecting all operators engaged in international trade with the EU. An EU Customs Authority will be established in Lille, France to support risk-based enforcement and coordinate crisis management, and customs declarations will be replaced by data submission in a centralized Data Hub.
