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The EU is getting ready a crackdown on the rising flood of packages from Asian on-line retailers corresponding to Temu and Shein, following a giant enhance in ecommerce that largely evades EU customized checks.
Measures into consideration embody a brand new tax on ecommerce platforms’ income and an administrative dealing with charge per merchandise that might make most shipments much less aggressive, in response to 5 individuals aware of the discussions.
European commerce commissioner Maroš Šefčovič has mentioned about 4bn lower-value parcels will probably be flown to the EU this 12 months, virtually triple the quantity in 2022. The sheer quantity and the truth that they’re beneath the €150 threshold for customized duties means most will not be checked, driving an increase in imports of harmful items corresponding to poisonous toys.
Whereas the EU govt is focusing on the enterprise mannequin of widespread on-line platforms corresponding to China’s Temu and Shein, which was based in China however is now based mostly in Singapore, no selections had been taken and any motion was difficult by worldwide legislation, the individuals mentioned.
EU officers are apprehensive concerning the undercutting of European rivals that face increased manufacturing prices to stick to EU requirements and the unfavorable influence of low cost imports on excessive avenue retailers.
The bloc’s security authorities have detected a rising variety of harmful and counterfeit items, lots of that are dispatched direct to shoppers.
China additionally advantages from subsidised postage prices, which means it’s cost-effective to ship low cost items by air. The EU govt has already proposed to scrap a €150 worth threshold beneath which packages are exempt from customized duties, a step the US can be taking.
However that might solely enhance the workload of already overwhelmed customized officers. Amsterdam’s Schiphol airport and Rotterdam port deal with a mixed 3.5mn packages a day — or 40 per second.
“There is no way you can check it all,” mentioned an EU diplomat.
Pricing ranges haven’t been set for a dealing with levy, however such a charge would apply to any on-line retailer delivery to EU clients immediately from exterior the bloc. US-based Amazon sometimes makes use of sellers based mostly in Europe.
EuroCommerce, which represents EU retailers, welcomed the deliberate crackdown however mentioned a dealing with charge can be tough to justify beneath WTO guidelines that restricted the quantity of charges and costs for customs processing to the approximate price of the service rendered.
“For now we urge the European Commission and member states to step up enforcement at national and EU level, and break down silos between different enforcement domains,” it mentioned. “New rules will take years to kick in.”
The variety of harmful merchandise reported by EU nations elevated by greater than half to over 3,400 in 2023 from a 12 months earlier. Cosmetics, toys, electrical home equipment and garments had been among the many merchandise with the largest issues of safety.
The bloc can be investigating Temu in a bid to cut back the circulate of unsafe merchandise corresponding to toys and cosmetics that don’t meet EU requirements. Beneath Brussels’ digital providers legal guidelines, potential penalties embody heavy fines and even the banning of platforms from working in a specific nation.
A tax on the income of ecommerce platforms, which might be utilized to EU in addition to international companies, would require approval from the bloc’s 27 member states, and will harm European companies at a time when Europe was attempting is to encourage digitisation, the individuals mentioned.
The incoming fee. which began work on December 1, is hoping to attract up a proposal by February, in response to an inner doc seen by the Monetary Occasions.
“E-commerce will be a key priority of the new commission’s mandate, specifically strengthening measures to prevent non-compliant products from entering the EU market,” a fee spokesperson mentioned.
Temu mentioned: “We support policy changes that benefit consumers. We believe that fair policies will not affect competitive business dynamics.”
Shein mentioned: “We fully support reforms that benefit European consumers and ensure transparent competition on a level playing field.”
Further reporting by Eleanor Olcott in Beijing and Alice Hancock in Brussels
