EU ends duty-free loophole for small online parcels

Core Viewpoint - The European Union has approved new customs duty rules that will eliminate the duty-free threshold for small parcels valued under €150, introducing a flat €3 customs duty per item starting from July 1, 2026, which is expected to impact pricing and sourcing strategies for retailers serving EU consumers [1][3][4]. Group 1: Customs Duty Changes - The new customs duty will apply to low-value imports, addressing the significant increase in cross-border e-commerce and the influx of small parcels entering the EU [2][3]. - The interim €3 charge will be in effect until a comprehensive overhaul of the EU customs system is completed, which includes the establishment of a centralized EU customs data hub [5][8]. Group 2: Impact on Retailers and E-commerce - Retailers that previously benefited from the €150 exemption will need to reassess their pricing models, margin structures, and supply chain planning due to the new customs duty [4][6]. - The change is expected to narrow the price gap between international sellers and EU-based retailers, potentially altering consumer purchasing behavior, especially in price-sensitive categories [7]. Group 3: Broader EU Customs Reform - The new customs duty is part of a larger EU customs reform aimed at modernizing digital customs processes and improving risk management, with plans to fully remove the low-value threshold in the future [2][8].