EU: Customs Union Reform
Read our summary of changes proposed by the European Parliament + Download Amendment Text
The Commission proposed reforming the EU Customs Code in May 2023. The package contains three separate legal acts: the primary regulation that establishes the EU Customs Code and the EU Customs Authority, a Council regulation on simplified tariff treatment for distance sales and the elimination of the customs duty relief threshold and a Council directive on auniquel scheme for distance sales of goods imported from third countries and import VAT. Parliament is a co-legislator on the first one.
Highlights of the changes :
Thorough preliminary vetting would enable trustworthy companies to benefit from fewer customs checks later.
Platforms must submit information to EU customs authorities about goods shipped to the EU from third countries.
All EU customs authorities use the same IT system, EU Datahub.
The overhaul of the EU Customs Code reform would change how customs authorities operate, cooperate with traders and manage goods people order online.
The EU Customs Code needs a thorough revamp due to the exponential growth of e-commerce and the many new product standards, bans, obligations, and sanctions the EU has implemented recently. The reform introduces new tools and simpler processes to help customs authorities work more efficiently and focus on checking the riskiest goods, shipments, and traders.
New approach to e-commerce
Consumers order more and more goods from third countries online. These goods do not necessarily meet the EU’s safety or environmental standards and legal norms. Additionally, approximately 65% of parcels entering the EU are deliberately undervalued, leading to a significant revenue loss. The new regulation places more considerable responsibility on web platforms, which would be obliged to submit information to EU customs authorities within one day about purchased goods to be shipped to the EU. This leads to a better overview of incoming shipments and enables customs authorities to target their checks, focusing on goods and traders that might not comply with EU norms.
Simpler procedures for trusted partners
Companies and traders who agree to undergo rigorous preliminary checks and controls would gain more freedom in dealing with customs authorities later. The most trustworthy companies would get a trusted trader status and could then operate with minimal checks and paperwork. This, in turn, would enable customs agents to focus on riskier businesses and shipments instead.
New digital solutions
The reform established a new IT platform called EU DataHub, the primary working tool for all European customs authorities. Businesses would find it easier to communicate with and submit information to authorities. Customs authorities would be able to analyse data more accurately, including with the help of AI, to help them check suspicious inconsistencies, potential tax fraud and risks related to specific companies or goods, for example.
Next steps
Parliament’s first reading position was adopted with 486 votes in favour, 19 against, and 97 abstentions. The new Parliament will follow up on the file after the 6-9 June European elections.
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