EU import duty on Chinese Temu, Shein and AliExpress

The European Union is set to impose import tariffs on several prominent Chinese online retailers, sources say.

The Financial Times reported that Brussels is preparing plans to impose tariffs on cheap goods bought from Chinese online retailers including Temu, Shein and AliExpress.

The move follows the recent imposition of high tariffs by the European Union and the United States on Chinese imports of electric vehicles due to allegedly excessive and unfair subsidies to local EV manufacturers by the Chinese communist government.

Import duties

Late last month, Chinese state media reported that Beijing wants the EU to cancel planned import tariffs on electric vehicles (EVs) by July 4, after the sides agreed to negotiations.

China denies unfairly subsidizing the electric vehicle industry and accuses the EU of protectionism and breaking international trade rules.

But now the Financial Times is reporting that Brussels is drawing up plans to impose tariffs on cheap goods bought from Chinese online retailers, in a bid to stem a surge in goods the EU says are substandard and come from China.

The European Commission will suggest later this month scrapping the current threshold of €150 (£126.94) below which goods can be purchased duty-free, three people familiar with the matter told the Financial Times.

Under current EU rules, parcels purchased online from a non-EU country are not subject to customs duties if their value is less than €150.

The main targets of the attacks were Chinese online platforms Temu and AliExpress, as well as clothing retailer Shein, one of the officials said.

Importing goods

According to the European Commission, 2.3 billion goods worth below the duty-free threshold of €150 were imported into the EU last year.

The FT notes that China benefits from postage subsidies, meaning it is profitable to send cheap goods by air.

The rules would apply to any online retailer that ships to EU customers directly from outside the bloc. US Amazon typically uses sellers based in Europe, the FT noted.

Another possible measure would be to introduce an obligation for large platforms to register for online VAT payments, regardless of their value.

From 2021, parcels sent to consumers in the EU are subject to VAT regardless of their value, but are exempt from customs duties.

The FT reports that these options will be presented in preparation for the establishment of a new commission that will take office this year.

Retailer Responses

The Commission had already proposed abolishing the duty threshold last year, sources said, but may now seek to speed up its adoption to counter a surge in cheap imports.

However, another official warned that getting approval from EU member states could be difficult because the new system would increase the workload of already overburdened customs officials.

It reportedly said that its growth does not rely on cheap products and that “we are open to and support any policy changes introduced by legislators that are in line with the interests of consumers,” provided the policies are fair.

AliExpress reportedly said it was “working with lawmakers” to “ensure that we are, and will continue to be, in a lawful position in the EU market.”

Shein also said he “fully supports” moves to reform tariffs.