Temu, Shein & Co.: EU Commission wants to check cheap imports better

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Europeans' desire to store online knows no bounds and is creating new problems. This is now prompting the EU Commission, which wants to put a stop to the flood of parcels with a new package of measures. This is likely to increase prices on some marketplaces.

12 million parcels arrive in the EU every day, reported Commission Vice-President Henna Virkkunen on Wednesday in Brussels at the presentation of the "toolbox", as the EU bureaucracy calls its bundled measures. Last year, 4.6 billion low-cost shipments were sent to the EU from third countries, which corresponds to 97 percent of direct imports, added EU Trade Commissioner Maroš Šefčovič .

According to the Commission, many of these pacts contain products that do not conform to standards and may not be sold here. This ranges from dangers such as electric shocks and choking hazards to trademark infringements and missing or inadequate consumer information. "Up to 96 percent of the products offered on these platforms do not comply with the regulations," says the new Justice and Consumer Protection Commissioner Michael McGrath.

System overwhelmed

However, the sheer volume of shipments is overwhelming the system of customs and market surveillance authorities. They are supposed to filter out non-compliant products. For this reason, the EU Commission now wants to take further measures and expressly believes that the member states, which are responsible for carrying out customs measures and market surveillance, also have a duty.

The EU regulations on consumer protection will be reviewed and adapted wherever necessary in order to make consumer contracts effective even for suppliers outside the EU, said McGrath. Those who abide by the rules have nothing to fear from the EU Commission's plans. EU consumer law was perhaps the strongest in the world, but it also had to be enforced.

However, the Commission did not have many new tools in the box on Wednesday. This is also due to the fact that some things are already on the way. The customs reform has been under discussion since the last EU legislative period, but is still being negotiated by the Member States and Parliament. The 150-euro exemption limit, up to which only import VAT is payable but no customs duties, is likely to fall. However, no agreement has been reached so far.

New fee for suppliers

However, the EU Commission is adding a "suggestion" to the previous proposals today: in order to cover the costs associated with stricter control measures, it is suggesting that the negotiators introduce a fee for inspections by customs and market surveillance authorities. This could be levied either on traders or on the platforms. The Commission only has the initial right to propose legislation; the Parliament and Council are then responsible for the actual formulation of the standards.

The Chair of the EU Internal Market Committee, Anna Cavazzini (Greens), signaled her support for the idea: a small handling fee for each of the millions of daily consignments of goods would be a good way to finance the necessary measures. Better cooperation between authorities and stricter enforcement of EU law are urgently needed, says liberal MEP Jeanette Baljeu. Platforms such as Temu and Shein should be held responsible for the products they put on the market.

German government likes the idea

On behalf of the German government, Federal Economics Minister Robert Habeck (Greens) was impressed by the EU Commission's initiative. It contains "many of the measures identified by the German government and makes important further proposals. The government had previously presented its own"e-commerce action plan", which was largely aimed at the responsibilities of the EU level.

"Providers such as Temu and Shein must no longer get away with breaking the rules," says Stefan Tromp from the German Retail Federation (HDE), while also warning that the Commission could overshoot the mark and create more bureaucracy. The digital association Bitkom also wants to avoid additional rules. The abolition of the duty-free limit and the enforcement of existing rules must suffice for the time being, says Bitkom CEO Bernhard Rohleder.

Stefanie Grunert from the Federation of German Consumer Organizations (vzbv) describes the EU Commission's initiative as a "missed opportunity". She believes it is right to apply the existing rules more consistently. "So far, providers have not been prevented from selling unsafe products via online marketplaces." The platforms must ensure that unsafe products are not offered via them in the first place.

Parallel to US developments

On Tuesday, a change in US customs practice also caused problems for Chinese providers in particular. Since then, US media have reported that shipments and containers that were on their way were rejected on import or not transported at all. The changes that have now come into effect were initiated by the Biden administration. However, the fact that this is happening at the same time as the EU Commission's initiative is pure coincidence, according to reports from Brussels today: "We would like to have this kind of coordination with our American partners," said Trade Commissioner Šefčovič with a laugh.

(mki)