EU’s Planned Customs Reform Means Major Changes for Businesses

The European Commission on May 17 put forward proposals for reforming the EU Customs Union to be implemented step by step, starting in 2028. This article provides an overview of the proposed measures, the timetable, and expected next steps.

EU-level governance will be introduced by establishing the new EU Customs Authority and the EU Customs Data Hub to perform customs clearance and post-clearance, as well as anti-fraud actions.

The reform would mean fewer declarations and checks for businesses. “Trust and Check” traders will be able to import goods with no active customs intervention needed. It also introduces tailor-made import processes for e-commerce.

Main Pillars of the Reform

Single EU interface. The new EU customs data hub will replace the existing customs IT infrastructure of the EU member states over time. Although technical details have not yet been published, the purpose of the hub is that businesses will provide information to customs through one single interface instead of through multiple national systems. The hub allows for multiple filing and recurring information to be provided once and reused for subsequent imports or exports.

From 2028, e-commerce platforms will be the first sector to log their sales into the hub. This will mean that there will be no need for a customs declaration for each specific parcel.

Customs checks at EU level. More collaboration between customs authorities at EU level will be introduced, allowing them to pool resources and expertise and to exchange information in real time. The EU customs authority will use AI to analyze and monitor the data in the hub and recommend to member states which goods posing a risk should be stopped at the border.

A tailor-made value-added tax and customs regime. The following measures will be introduced for e-commerce from March 1, 2028:

• Online platforms will become “deemed” importers. Platforms, instead of EU consumers, will be responsible for ensuring that customs duties and VAT are paid on the sales when goods are imported into the EU. Platforms need to include the customs duties and import VAT in the price at the point of sale.
• EU customers will have transparency on the full cost of their online purchase and pay for it in one go, instead of being faced with hidden charges when the parcel arrives.
• Removal of customs duty relief—the current exemption from customs duty for goods valued at less than 150 euros ($163) will be abolished. This means that all imported goods will be subject to customs duties.
• The current threshold of 150 euros for the import one-stop shop, or IOSS, scheme will be eliminated. This means that consignments with a value above this threshold also could be reported in the IOSS.
• Simplified duty calculation for distance sales—a simplified tariff treatment will be introduced for goods imported and sold to private individuals (“distance sales” for VAT purposes).
• There will be an extension of special arrangements for postal operators to pay import VAT on behalf of EU customers. The 150-euro threshold that currently applies to the special arrangements will be removed.

Other Changes

Introducing the legal definition of “importer” and abolishing the notion of “declarant.” Each single consignment will be linked to one single operator—“importer"—who will be liable for compliance with duty payments and product rules. Importers will be responsible for paying the applicable duties and taxes and ensuring compliance with the various EU standards and other legislative requirements.

Simplified clearance for trusted traders. Trust and check traders (built on the current Authorized Economic Operator status) will benefit from further reductions in the physical and document-based controls. They will have one single customs administration while operating across the EU, and will need to provide real-time data on the movement of their goods. These goods will be able to move via “green lanes” without formal customs interaction and free of administrative burdens, while customs will request a control only if necessary.

Easier to amend customs data. Importers/exporters can amend one or more particulars of the data provided for placing the goods under a customs procedure. In addition, the importer and the exporter can invalidate the data provided for placing goods under a customs procedure as soon as it comes to their knowledge that the goods will not be imported or exported.

Non-criminal sanctions for customs infringements. The proposal qualifies the sanctions as non-criminal in matters for which the member states have jurisdiction.

Timeline and Next Steps

• From 2028:
  • Centralized clearance for imports of trust and check traders will be introduced.
  • Platforms will have more obligations when selling imported goods to EU customers.
  • The hub will open for e-commerce.
  • The duty relief for the import of goods with a total value up to 150 euros per consignment will be eliminated.
  • (Deemed) importers may opt for the use of the simplified tariff treatment for the calculation of the customs duty.
  • The IOSS will be extended to all business-to-consumer sales of imported goods, regardless of their value.
  • The simplified arrangements for postal operators will be extended to cover consignments over 150 euros.
• From 2032:
  • Traders may start using the hub on a voluntary basis.
• From 2038:
  • Using the hub becomes mandatory.

The European parliament and the Council of the EU still need to approve the proposals. The new legislation is expected to come into effect by 2025.

Actions for Businesses

Importers, carriers, and other actors need to assess the potential impact of the proposed measures.

• Evaluate whether the changes planned for e-commerce such as new obligations for platforms or simplified duty calculation for distance sales affect their business
• Evaluate the effects of the removal of the customs duty relief
• Determine whether the trusted trader status could benefit their business
• Assess the correctness of data
• Evaluate readiness of the systems to exchange data
• Implement changes in their systems if necessary
• Further automate their business processes

This article does not necessarily reflect the opinion of Bloomberg Industry Group, Inc., the publisher of Bloomberg Law and Bloomberg Tax, or its owners.

Author Information

Aiki Kuldkepp is senior manager, tax, with Grant Thornton Netherlands.

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