Customs revamp intended to curb import of inexpensive Chinese goods.
In 2023, approximately two billion parcels valued at less than €150 will enter the EU from non-EU countries. This fact is allegedly making it easier for budget items from Asian retailers to enter the European market. However, this is poised to change. It's not just Temu and Shein experiencing opposition.
The German government is considering a potential restructuring of the EU's import regulations. This may have an impact on Asian online retailers such as Shein and Temu. The German Retail Association, HDE, asserts that the Federal Ministry of Finance intends to support the scrapping of the €150 duty-free limit in the EU. At the moment, when importing parcels valued at less than €150, no customs duties are required. This situation provides benefits to low-cost retailers from the East.
The HDE dislikes this regulation because they believe it contributes to a torrent of inexpensive goods from Europe. Additionally, they criticize how many goods cannot be properly scrutinized by customs officials to ensure they adhere to European standards.
Christian Lindner, Germany's Finance Minister, has signaled that the government will support abolishing the €150 regulation at the European level. The Ministry of Finance stated that it wouldn't comment on specific cases, but that they welcome the fact that the EU Commission has presented plans to adapt customs regulations to the realities of online commerce. The Commission unveiled these reform proposals in May 2023.
The possibility of retaliation
Temu, an online retailer, claims that their growth is not solely attributable to the lack of import duties on goods under the €150 threshold. Instead, they argue that it's a result of their efficient supply chains. Shein, currently seeking a stock market listing in London, insists that they adhere to all applicable rules and regulations - including customs regulations. Shein's pricing structures are not based on EU customs regulations.
The Ecommerce Europe association, which includes the likes of Amazon and eBay, has previously expressed concerns over the removal of these exemptions. This might prompt reprisal measures from the EU's trading partners.
The EU Commission disclosed that last year, approximately two billion parcels with a declared value of less than €150 each arrived in Europe from non-EU countries. Eliminating the exemption could also lead to online retailers splitting deliveries to stay below the €150 threshold. Additionally, around 65% of parcels' declared values could have been intentionally underestimated. Shein and Temu confirmed that they accurately declare the value of their products and do not split shipments.
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The EU Commission, in response to the influx of inexpensive Chinese goods through online shopping, has proposed adapting customs regulations to the realities of online commerce. Christian Lindner, the German Finance Minister, has endorsed this plan to scrap the €150 duty-free limit. This could potentially increase customs investigations at online trading sites like Shein and Temu, whose growth may not solely rely on the current duty-free exemption, according to their own claims. However, the potential changes could also prompt retaliation from China's customs offices if the EU Commission moves forward with these reforms.
Source: www.ntv.de
