On 17 May, the European Commission published a proposal to reform the EU Customs system.
Among the key elements of the reform is the establishment of a new EU Customs Authority which aims to create a more cost-effective framework for cooperation and will replace the 111 IT systems currently in use in the 27 Member States.
The EU Customs Authority will act based on data provided through the EU Customs Data Hub, which should allow importers to do their customs declaration in a single online platform. The Data Hub should also contribute to assessing risks in line with existing due diligence procedures (deforestation, forced labour, etc.). The hub would become mandatory for all importers starting from 2038.
In parallel, the European Commission proposed to create a status of ‘most trusted traders’ for businesses whose supply chains are recognised as completely transparent (i.e. a clean legal record, a high level of control of their operations and supply chain, and financial solvency). These ‘most trusted traders’ would be able to put their goods into circulation without any active customs intervention at all.
Another essential part of the reform concerns to role of online marketplaces to ensure compliance with customs obligations. Indeed, online marketplaces will be responsible for ensuring that customs duties and VAT are paid at purchase, so consumers will no longer be surprised by unexpected costs and paperwork when the parcel arrives. These provisions would apply as of 2028.
In addition, the reform abolishes the current threshold whereby goods valued at less than €150 are exempt from customs duty. Consequently, all products regardless of value will be subject to custom duty. However, the proposal would simplify customs duty calculation for the most common low-value goods bought from outside the EU, reducing the numerous possible customs duty categories down to only four.
To read more about the proposal, please click here.