The proposal of the European Commission about the EU Customs Reform (COM(2023) 258 final) will have a big impact on e-commerce transactions of imported goods.
The reform will make online platforms key actors in ensuring that goods sold online to private consumers (B2C) established in the EU comply with all customs obligations.
These platforms will be responsible for ensuring that customs duties and VAT are paid at purchase and abolishes the current threshold whereby goods valued at less than € 150 are exempt from customs duty.
The UCC proposal introduces the definition of ‘deemed importer’, which means ‘any person involved in the distance sales of goods to be imported from third countries into the EU who is authorised to use the special scheme laid down in Title XII, Chapter 6, Section 4 of Directive 2006/112/EC’.
The deemed importer will be obliged to provide or make available the information on distance sales of goods to be imported in the EU at the latest on the day following the date when the payment was accepted and in any event prior to the release of the goods.
Moreover, it will be obliged being established in the EU. If not established in the EU, the deemed importer shall appoint an indirect representative.
The proposal also introduces a simplified tariff treatment for goods imported under a B2C transaction qualifying as distance sales for VAT purposes.
There will be only five different buckets with respective ad valorem duty rates of 0% (e.g. for books, printed materials, works of art), 5% (e.g. for toys, musical instruments, metal cutlery), 8% (e.g. for silk and cotton products, ceramic products, photographic goods), 12% (e.g. for leather articles, travel bags) and 17% (e.g. for footwear, glassware).
The simplified tariff treatment is to be applied on a voluntary basis by the deemed importer. However, where the importer has opted to apply the simplified tariff treatment, there is no need to prove the origin of the goods and both the costs of transport of the imported goods up to the place where goods are brought into the EU and the costs of transport after their entry into that territory, shall be included in the customs value.
Goods subject to EU harmonised excise duties are excluded from the simplified tariff treatment.
The deemed importer will provide information to customs directly via the EU Customs Data Hub, instead of through multiple national systems. It will be able to file once for multiple consignments and the data provided can be reused for subsequent imports or exports.
Deemed importer will log their sales into the EU Customs Data Hub. This will be possible, on a voluntary basis, only in 2032. By the end of 2037, the EU Customs Data Hub should be fully developed, and all economic operators shall use it.
The proposal EU Customs Reform foreseen the possibility to return goods outside of the EU.
Where goods previously imported by a deemed importer under distance sales are returned to the original consignor’s address or to another address outside the EU, the deemed importer shall invalidate the information on release for free circulation of those goods and provide or make available the proof of exit of the goods out of the EU. Then, there is the reimbursement of the customs duties and VAT paid.
To conclude, it can be said that the EU Customs Reform will bring big changes to online platforms selling goods to private consumers established in the EU.
The deemed importer incurs the customs debt at the moment of payment of the sale, similar to the provisions on VAT and not anymore at the moment of the release for free circulation. To simplify the burden related to such obligation, the deemed importer may be authorised to determine the import duty due and to pay its customs debts periodically.
The provisions on the simplified tariff treatment for distance sales and deemed importer should apply from 1 January 2028.
Our Team of expert can assist you with the implementation of these changes.