Unlock the Editor’s Digest for free
Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
The EU is planning to hold ecommerce platforms such as Temu, Shein, and Amazon Marketplace accountable for the sale of dangerous or illegal products online, particularly those originating from China.
A draft proposal obtained by the Financial Times reveals that customs reforms will require online platforms to provide data prior to goods entering the EU, enabling officials to better monitor and inspect incoming packages. This initiative comes in response to the growing concerns surrounding the influx of unsafe and counterfeit goods being shipped directly from Asia to European consumers.
Currently, individuals in the EU who make online purchases are considered the importers for customs purposes. However, if the proposed reforms are implemented, the responsibility will shift to the platforms themselves.
The proposal highlights the significant risks posed by the increasing volume of unsafe and non-compliant products, emphasizing the negative impact on consumer safety, environmental sustainability, and fair competition in various sectors.
In 2024, the EU imported 4.6 billion low-value parcels, with over 90% originating from China. The overwhelming quantity of these items has put immense pressure on authorities, prompting the need for stricter regulations.
Under the new reforms, online retailers will be mandated to collect relevant duties and VAT, ensure compliance with EU regulations, and eliminate the current exemption for goods valued under €150 from duty payments.
The proposal also includes the establishment of a central EU customs authority (EUCA) to consolidate customs data from national authorities and enhance monitoring of supply chains to anticipate and address potential risks.
Counterfeiting has resulted in substantial financial losses for various industries, with the clothing, cosmetics, and toy sectors being heavily impacted. The proposal also introduces waste management rules that require sellers to contribute to the disposal costs of unwanted products.
Furthermore, the EU is considering implementing a handling fee per package and enforcing market behavior regulations on large online platforms such as Shein, Amazon, AliExpress, and Temu.
Online marketplaces are currently exempt from liability for products sold by third-party vendors, but the commission is investigating potential violations and taking action against those found in breach of regulations.
While some platforms have assured compliance with EU laws, policy changes and stricter enforcement measures are expected to improve consumer protection and enhance market integrity.