Published on: May 21, 2025 / Updated on: May 21, 2025 – Author: Konrad Wolfenstein
EU levies for TEMU and SHEIN: EU plans parcel fee for online orders from China – Image: Xpert.Digital
EU levy on cheap imports: Challenges for Temu and Shein
Customs reform: How the EU is holding budget platforms accountable
The European Commission is planning a flat-rate duty of up to two euros on parcels from third countries, with a particular focus on the low-cost carriers Temu and Shein. This measure is a response to the massive increase in daily parcel deliveries, which currently stand at around twelve million shipments and pose significant challenges for European customs authorities.
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The planned fee structure
The European Commission has presented a concrete proposal for the introduction of a flat-rate levy. This proposal includes:
- A fee of two euros per package applies for direct deliveries to private households
- Reduced fee of 50 cents for packages delivered to department stores
EU Trade Commissioner Maroš Šefčovič explained the plan to the European Parliament's Internal Market Committee on May 20, 2025. He emphasized that the fee should primarily be borne by the platforms where consumers place their orders, but acknowledged that providers could pass these costs on to their customers through higher prices.
Background and extent of the problem
The enormous increase in parcel shipments from third countries, especially from China, has pushed the European customs and surveillance system to its limits:
- In 2024, approximately 4.6 billion parcels were imported into the EU, which corresponds to around 145 shipments per second
- 91 percent of these deliveries come from China
- Most of these shipments have a value of less than 150 euros and are therefore currently exempt from customs duties
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Business model of low-cost providers
Temu and Shein have built their business model on direct deliveries from China:
- Temu, which has also been active in Germany since 2023, attracts customers with extremely low prices by delivering products directly from the manufacturer to the consumers
- Shein, originally founded in China and now based in Singapore, functions as a manufacturer, retailer and marketplace all in one, and can keep its prices low by eliminating intermediaries, stores and large inventories
Green Party politician Anna Cavazzini, chair of the Internal Market Committee in the European Parliament, describes the problem as follows: “The phenomenon of single, low-value packages is new and is growing relentlessly thanks to ultra-cheap marketplaces like Shein and Temu. The European system of customs and market surveillance was never designed for this.”
Objectives of the measure
The planned parcel fee pursues several goals:
1. Relief for customs authorities
The flood of parcels has led to a massive overload of customs authorities. The levy is intended to help cover the “increased monitoring costs” and provide the necessary resources for enhanced controls.
2. Generating revenue for the EU budget
Part of the revenue from the fees is intended to benefit customs authorities, while another part will flow directly into the EU budget. Sefcovic estimates that collecting the fees could generate approximately three billion euros annually for the EU budget.
3. Improvement of consumer protection
Consumer protection organizations warn that over 90 percent of products from platforms like Shein or Temu do not comply with EU law and some contain toxic chemicals. The stricter controls are therefore also intended to protect consumers.
4. Creating fairer competitive conditions
The measure aims to reduce the systematic disadvantage faced by European retailers compared to Far Eastern platforms. The Austrian Retail Association expressly supports the planned two-euro fee as a step towards fairer competition.
Further planned measures
The parcel fee is part of a broader reform package:
- Possible abolition of customs exemption for packages with a value of less than 150 euros
- Stricter market controls for products from third countries
- Better equipment for customs authorities to enable increased import controls
- Temporary blocking of platforms in cases of repeated legal violations
Current investigations against Temu and Shein
Parallel to the planned fee, investigations are already underway in Brussels against the discount retailers Shein and Temu:
- Investigations into possible violations of EU consumer protection laws and the rules for online platforms
- EU consumer protection authorities announced stricter measures against Shein in February 2025
- Official proceedings by the EU Commission are already underway against Temu
Market developments and reactions
The German Retail Federation (HDE) has observed that Chinese online retailers like Temu and Shein are increasingly focusing on Europe and Germany, after the US market became less attractive due to President Trump's tariff policies. According to Stephan Tromp, Deputy Managing Director of the HDE, spending on digital advertising in Europe rose by 40 percent or more in April and May 2025.
The EU measure is similar to the approach taken in the USA, where the “de minimis” exemption, which exempted shipments under $800 from customs duties, was abolished.
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EU parcel tax: Opportunity for fair competition or burden for consumers?
The planned parcel fee is the EU's response to the unprecedented increase in direct imports from China, which are straining customs authorities and raising questions about consumer protection and fair competition. With a flat fee of two euros per parcel, the European Commission is attempting to finance controls while simultaneously creating incentives for retailers to increase warehousing within the EU. Whether the measure will achieve the desired effects, or whether the fees will ultimately be passed on to consumers, remains to be seen.
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