Embracing Digital Transformation for Business Growth
One of the main objectives of the reform is to simplify customs processes for businesses vastly. Particularly for ‘Trust and Check’ merchants, the most reliable in the industry, the new customs framework will be a boon. These businesses will work with a single customs administration and a newly created Data Hub, the technological cornerstone of the reform. This data-driven system is estimated to save merchants up to €2.7 billion annually.
The most trustworthy merchants will be able to import goods without active customs intervention, significantly reducing lengthy and cumbersome customs procedures. Traditional declarations will be replaced with a data-led approach to import supervision, giving businesses the ease of a single EU interface and facilitating data reuse.
„The EU Customs Union has been at the heart of EU integration for the past 55 years. In the face of new challenges and threats, today, we are equipping ourselves with another tool to speed up trade flows and support our economic recovery. This far-reaching reform will reduce red tape and compliance costs for businesses, create more transparency and certainty for EU citizens when shopping online, and introduce simpler and innovative processes for the authorities.“
Reinventing Customs Through Data-Driven Insights
Customs authorities will be equipped with a 360-degree overview of individual supply chains, thanks to the implementation of EU-level risk management. Real-time access to data and pooling information allows authorities to respond to potential risks more rapidly, consistently, and effectively.
Focused checks and identifying risks before goods even depart for the EU will allow authorities to uphold EU values better and protect the security and safety of all EU citizens. The modernised system also promises significant cost savings for authorities – up to €2 billion annually in IT operating costs.
Instilling Confidence Among EU Citizens
The comprehensive reform aims to boost citizen confidence in various ways. Those purchasing online from outside the EU can have more certainty that unsafe, illegal, and dangerous goods will be more effectively stopped from entering the EU.
In addition, the reform addresses the issue of hidden or unexpected charges upon the arrival of parcels. Online sellers will be required to charge customs duties upfront, giving consumers peace of mind knowing there won’t be any surprises on delivery. Additionally, the new system promises to usher more funds for public services such as schools and hospitals due to more efficient revenue collection.
Modernising E-commerce for Secure Transactions
The reform brings a new e-commerce framework, significantly departing from the current customs system. The new rules designate online platforms as importers, making them responsible for all customs formalities and ensuring the goods they sell into the EU comply with all standards and legislation on imports. This new framework will reassure EU consumers that their online purchases are safe, sustainable, and compliant with EU regulations.
Empowering Online Platforms
With the reform, online platforms are becoming pivotal players in ensuring all goods sold online into the EU meet the requisite customs obligations. A significant departure from the prevailing customs system, the new rule transfers the responsibility from individual consumers and carriers to these platforms. As a result, consumers will be spared from surprise costs or unexpected paperwork when their parcel arrives. As the official importers, these online platforms provide EU consumers with the assurance that all duties have been fulfilled, and their purchases align with EU standards of environment, safety, and ethics.
Unveiling the 4-Category Duty System
The reform considerably simplifies the customs duty calculation for the most common low-value goods bought outside the EU, dramatically reducing the vast array of possible customs duty categories to a mere four. This streamlining will ease calculating customs duties for small parcels, aiding platforms and customs authorities in better managing the billion e-commerce purchases entering the EU each year. It also eliminates opportunities for fraud. This new, tailor-made e-commerce framework is projected to garner an additional €1 billion annually in customs revenues.
Abolishing the Under-€150 Exemption
The reform also ends the current provision that exempts goods valued less than €150 from customs duty—a loophole frequently exploited by fraudsters. It’s worth noting that approximately 65% of such parcels entering the EU are currently undervalued to evade customs duties.
The Future of EU Customs: Data Hub and Authority
The future direction of the Customs Union will pivot around two game-changing tools: The EU Customs Data Hub and the EU Customs Authority. These entities will provide a comprehensive view of the movements of goods and their supply chains, making the same real-time data available to all member states. This cooperative approach and the constant sharing of data are set to create a truly common external border for goods.
In conclusion, the proposed comprehensive reform of the EU Customs Union promises to usher in a new era of simplified processes, business growth, and consumer confidence. Expecting significant cost savings for authorities and merchants and more efficient procedures marks the reform as a powerful stride towards a greener, more digital era in the EU’s trade ecosystem.
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