On 17 May 2023, the European Commission released a proposal to change the European Union's customs framework. This proposal represents the most ambitious and extensive reform of the European Customs Union since its establishment in 1968.
The reform addresses the existing difficulties faced by EU customs, including a significant rise in trade volumes, particularly in e-commerce, an increasing number of EU standards requiring goods being examined at the border, and evolving geopolitical challenges.
EU Customs Data Hub
The proposed reforms offer a pioneering, data-driven framework for EU customs, significantly streamlining customs procedures for businesses, particularly for the most trusted traders. It will bring the possibilities of using cutting-edge technology and standardise customs procedures, while ensuring the safety of EU borders and maintaining fair competition.
The reform will streamline customs procedures by replacing traditional declarations with a more efficient, data-driven method of import monitoring. At the same time, customs authorities will possess the necessary capabilities and resources to effectively evaluate and halt imports that present genuine hazards to the EU, its populace and its economy.
EU Customs Authority
A newly established EU Customs Authority is going to oversee an EU Customs Data Hub, which will function as the core of the new system. The Data Hub will eventually replace the current customs IT infrastructure in EU member states, resulting in annual savings of up to €2 billion in operational expenses. The new authority will provide an enhanced EU strategy for risk management and customs inspections.
Low value duty-free threshold removal
The reform will also eliminate the €150 duty-free threshold for imported products, consequently closing a loophole that has permitted undervaluation and tax evasion on small parcels entering the EU. The removal of this exemption will boost revenue collection and ensure fair competition for EU businesses. The change will be paired with simplified duty calculations for low-value products, which will facilitate compliance for businesses and guarantee a seamless implementation.
‘Trust and Check’ system
The EU is looking at implementing ‘Trust and Check’ system, a significant enhancement of the existing Authorised Economic Operator (AEO) programme. The initiative could potentially enhance collaboration between customs authorities and businesses by offering significant simplifications for traders exhibiting a high level of transparency and compliance.
Approved businesses may see benefits from streamlined customs procedures, and simplified entry of goods into the EU market with minimal intervention at the borders, provided they adhere to strict compliance standards. This improvement should support companies that have implemented compliant processes and supporting technology, but will also help customs authorities to focus their resources efficiently on high-risk shipments that might pose a threat to the EU and its citizens.
What lies ahead
These reforms represent a turning point in EU trade and border management policy. The EU is establishing a new benchmark for customs modernisation by addressing inefficiencies, adopting technology, giving security and sustainability first priority.
These actions, if implemented correctly and with collaboration with the businesses across the EU, will help companies safeguard customers and strengthen the integrity of the Single Market.
This change has the potential to positively transform the movement of goods in and throughout the EU, and can guarantee the Customs Union continues to be a fundamental element of EU competitiveness and prosperity in a dynamic global trading environment.
You can get tailored support to manage these changes in EU customs from the Chartered Institute of Export & International Trade's Imports Advisory Service. Further information on these and other changes coming for UK importers in 2025 can also be found in our guide to importing in 2025 here.
