July 1 has passed. Here's what you need to know now.
The European Union has introduced a new customs duty on low-value B2C ecommerce imports from non-EU countries, effective July 1, 2026. The duty ends the longstanding €150 duty exemption and replaces it with a temporary flat fee applied per declaration line. This article covers what U.S. retailers need to know to operate under the new rules.
This article applies specifically to B2C shipments imported into the EU from non-EU countries. It does not apply to intra-EU shipments.
I wrote about the broader regulatory shift for Global Trade Magazine. The article focuses on what ecommerce retailers need to do now.
~ Alison Layfield
Retailers should understand that the new customs environment involves multiple distinct charges, not one. The four layers are:
- EU-wide €3 customs duty per declaration line, effective July 1, 2026, applying to B2C parcels from non-EU countries valued under €150
- National handling fees introduced separately by individual member states, including Romania and Italy, which vary in status and timing as detailed below
- VAT, which continues to be collected through IOSS for eligible consignments. Whether VAT applies to the €3 duty itself is still awaiting final EU clarification, though evidence from Irish Revenue and Belgian Finance suggests it likely does
- An EU-wide handling fee expected in Q4 2026, anticipated to operate by the same per-declaration-line mechanism as the €3 customs duty. The amount has not been officially confirmed. Industry expectation based on national fee levels set by France and Italy points to approximately €2, but the EU has not announced a figure. Discussions are underway about bringing the effective date forward ahead of November 1
Landed-cost models and checkout systems need to be built to handle this stack, not just the EU-wide €3 duty in isolation.
How the EU customs duty works
The EU now applies a temporary €3 customs duty per declaration line on B2C parcels imported from non-EU countries and valued under €150. This replaces the duty exemption for parcels below that threshold that was in place until June 30, 2026.
The duty is €3 per declaration line. An item is defined as one or more goods sharing the same tariff classification and description within a consignment. How that plays out in practice depends on the declaration type used.
For H7 declarations, which use a minimal data set and are the most common for ecommerce, goods sharing the same six-digit HS code are grouped as one declaration line and trigger one €3 charge.
For H1 declarations, which use a full data set including ten-digit TARIC codes, goods classified under different TARIC subheadings become separate declaration lines, each triggering €3.
The calculation works as follows:
A parcel containing one book and two identical bookmarks with the same SKU, declared on the same line, results in two declaration lines totaling €6 (€3 x 2).
A parcel containing one book and two bookmarks with different SKUs results in three declaration lines totaling €9 (€3 x 3), unless an HS6 grouping is available to consolidate them.
The declaration type used by your carrier or customs broker directly affects your landed cost calculation. Retailers should confirm which declaration type applies to their shipment flows and model costs accordingly.
Some shipments may find it more cost-effective to file an H1 declaration and pay ad valorem duty rates rather than the flat €3 per line, particularly where a consignment contains many very low-value goods across multiple lines. This is worth reviewing with your customs broker.
Both DDU and DDP shipments are subject to the €3 duty. There is no fee exemption based on incoterm.
The €3 duty is a temporary measure, expected to remain in place until the EU Customs Data Hub becomes operational, currently anticipated around 2028, at which point standard EU tariff rates are expected to apply.
Who is responsible for the duty
The responsibility for paying the €3 duty lies first and foremost with the declarant. The EU guidance establishes a specific cascade for determining who the declarant is:
- The IOSS holder, or its indirect representative
- The person making special arrangements, or its indirect representative
- The indirect representative of the importer
- Any other person able to provide information and present the goods to customs
The consumer is only a residual option in the limited number of member states that provide a free online declaration system for individuals. In practice, the IOSS holder is the primary debtor.
The European Commission's DG TAXUD has been explicit on this point: the €3 duty is the obligation of the IOSS holder. It is a business expense. How or whether to recover it from the consumer is a business decision, not a customs requirement. This is different from VAT, which is a tax on consumption.
For IOSS-registered retailers, the practical flow is: your service provider collects the duty when goods enter the EU and bills it back to you. You decide whether to collect it from your customer at checkout. DDP is the approach that makes that collection transparent and predictable.
DDP vs DDU: what retailers need to know
DDP is the clearest path forward. Under DDP, the duty is collected at checkout, the process is transparent, and there is no ambiguity about who pays or when. For IOSS-registered sellers, this is the approach the EU framework is built around and the one ePost recommends.
DDU is technically available but carries significant operational uncertainty. EU member state postal operators are each making their own decisions about how to handle the duty requirement, and those decisions vary widely. Some are offering DDU only. Some are offering DDP only. Germany has indicated it will not offer DDU. Poland has indicated it will only offer DDU. USPS is working toward DDP for all EU countries that can accept it, but DDP is not currently available to enterprise shippers using permits; it is only available through USPS's GSS platform or API-connected accounts.
For non-IOSS sellers, the applicable term is DAP (Delivery at Place). The same uncertainty around foreign postal operator handling applies.
The practical risk with DDU is that once your shipment leaves the U.S. and enters the EU, what happens next depends on decisions made by the destination country's postal operator. If the duty is not collected and the customs debt is not covered, goods may be held until payment is made. That creates a customer experience problem that is difficult to manage from the U.S. side.
ePost has a DDU solution through our carrier partner network. The concern is not whether we can offer it on our end but what happens once the parcel reaches the destination country. Until member-state implementation stabilizes, DDP is the solution with the least risk and the most transparency for your customers.
National handling fees: a separate layer
In addition to the EU-wide €3 customs duty, several member states have introduced or announced their own national handling fees. These are legally distinct from the EU customs duty and stack on top of it. Status varies by country.
Romania introduced a flat logistics tax of €5 (RON 25) per parcel effective January 1, 2026. The fee applies to shipments valued under €150 originating outside the EU and destined for Romania, regardless of where within the EU the parcel is released for free circulation. Parcels that are not delivered to the final recipient in Romania are not subject to the tax. The obligation to collect and remit the tax lies with postal service providers. The fee is not refundable on returned parcels.
France introduced a €2 small parcel tax effective March 1, 2026. That fee has since been suspended ahead of the July 1 EU-wide duty implementation. Whether France reintroduces a national fee has not been confirmed. France is not currently applying a national handling fee.
Italy announced a €2 national handling fee, originally scheduled for January 1, 2026, then postponed to March 1, 2026, then suspended entirely. The fee has been rescheduled and is now expected to take effect October 1, 2026, applying per parcel to all shipments valued under €150 from non-EU countries destined for Italy.
Romania is the only country currently applying an active national handling fee. Italy's fee is expected October 1. France's fee is suspended with no confirmed reintroduction date.
The EU-wide handling fee in Q4 2026
A separate EU-wide handling fee is expected to take effect November 1, 2026, with discussions underway about bringing that date forward. It will operate by the same per-declaration-line mechanism as the €3 customs duty. The amount has not been officially confirmed by the EU. Based on the national fee levels set by France and Italy, industry expectation points to approximately €2 per declaration line, but retailers should treat that figure as an estimate and watch for the official announcement.
The calculation logic mirrors the €3 duty: a parcel with two declaration lines would trigger €4 (€2 x 2) under the expected amount. A parcel with three declaration lines would trigger €6 (€2 x 3), unless an HS6 grouping reduces the line count.
Both DDU and DDP shipments will be subject to the handling fee.
The possible acceleration of the November 1 date makes early system flexibility important. Retailers who have not yet built the €3 duty into their checkout systems are already behind. The Q4 fee is next.
Why the work is not done
The EU-wide duty is now in effect, but the full regulatory picture for 2026 is not settled. Romania's €5 fee is active. Italy's €2 fee arrives October 1. The EU-wide handling fee arrives in Q4 with a possible earlier date. The VAT treatment of the €3 duty is still awaiting official clarification. Member-state DDU decisions are still evolving.
Retailers who treated July 1 as the finish line need to reframe. It was the starting line. The operational and compliance work continues through the rest of 2026.
Cost modeling scenarios
Model landed costs using the confirmed per-declaration-line structure, not a flat per-parcel assumption. A per-parcel calculation is not how the duty works.
The key variables are declaration type and product mix. Two identical items declared on the same line count as one line. Two items with different SKUs count as separate lines, each triggering €3, unless an HS6 grouping consolidates them.
For the €3 duty: a parcel with three declaration lines triggers €9. For the anticipated €2 handling fee when it takes effect: the same parcel triggers €6. Combined, that is €15 before VAT on a single shipment with three declaration lines.
For shipments destined for Romania, the €5 logistics fee stacks on top. A three-line shipment into Romania could carry €20 in combined duty and fee exposure before VAT, on a parcel valued under €150.
Product mix directly affects exposure. Single-SKU orders in one tariff classification are the most predictable. Multi-item shipments with different SKUs across classifications require line-by-line cost modeling.
If VAT applies to the €3 duty, as Irish Revenue and Belgian Finance suggest, add that to each scenario. Final clarification is pending but planning for it now is the lower-risk approach.
New data requirements: product identifiers
Starting November 1, 2026, three new product identifier fields are required on customs declarations for all distance sale imports into the EU. They are optional from July 1, 2026, with no penalties during the voluntary period.
The three fields are:
- Merchant product identifier (M-PID): the merchant or seller product ID or SKU for the product being sold. For Amazon shipments, this is the ASIN
- Non-standardized manufacturer product identifier (NS-PID): the manufacturer product identifier, part number, or model number when a standardized product ID is not available
- Standardized manufacturer product identifier (S-PID): the globally recognized manufacturer product identifier such as GTIN, EAN, or UPC, required only where it exists
Shipments lacking the required product identifiers after November 1 risk delays or rejection by EU customs.
For ePost customers, we are working toward compliance for the November 1 mandatory date. If you begin passing these identifiers before that date, we will pass them through. If you are not ready until November 1, that aligns with when enforcement begins. The key question to answer now is whether your product data systems can generate and pass these identifiers at the shipment level.
Returns: the duty is not refundable
The €3 customs duty paid on a parcel cannot be reclaimed if the goods are returned after release. Romania's national logistics fee is also explicitly non-refundable on returned parcels. Standard customs refund rules under Article 116 UCC continue to apply in limited circumstances, but for practical purposes, treat the duty as non-refundable.
This affects returns policy, customer messaging, and margin calculations on any product category with high return rates.
IOSS: what has and has not changed
The existing VAT schemes for imported goods, including IOSS, Special Arrangements, and the standard VAT procedure, have not changed as a result of the €3 customs duty. IOSS continues to operate as it did. It is not being replaced or phased out.
What has changed is that IOSS-registered sellers are now also the primary debtors for the €3 customs duty. The two obligations, VAT via IOSS and customs duty, are separate. IOSS cannot be used to remit the customs duty. Your service provider will collect and remit the duty on your behalf and bill it back.
The one open question is whether the €3 duty itself is subject to VAT. Irish Revenue and Belgian Finance both indicate it is. The EU guidance deferred this question and DG TAXUD did not answer it on the UPU webinar. If VAT does apply to the duty, that adds to the landed cost calculation. Plan for it and watch for the EU's formal clarification.
Checklist: what retailers need to do now
- Confirm your declaration type with your carrier or customs broker and model landed costs under H7 and H1 scenarios. Do not model based on a flat per-parcel assumption.
- Model Romania exposure now. The €5 logistics fee has been active since January 1. If you are shipping to Romania, you should already be accounting for it. Note that undelivered parcels are exempt from the fee; returned parcels are not.
- France's national fee is currently suspended. Remove it from active cost models until a reintroduction date is confirmed. Add Italy at October 1, 2026.
- Decide on DDP or DDU and align with your carrier. DDP is the clearer path. If you are using DDU, confirm what your carrier's partner in the destination country is actually doing with the duty before the next shipment cycle.
- Audit your checkout system. Confirm it can display the duty as a separate line item, update fee logic without a full rebuild, and accommodate the Q4 handling fee once the official amount is confirmed.
- Review your returns policy and customer messaging in light of the non-refundable duty. If this has not been updated, do it now.
- Audit your product data for the November 1 PID requirement. Identify your merchant product identifiers, manufacturer identifiers, and standardized identifiers now, not in October.
- Designate an internal owner for ongoing compliance. Italy's October 1 fee, the Q4 EU handling fee, the possible acceleration of that date, and ongoing member-state DDU decisions all require someone tracking and translating updates into system changes in real time.
Frequently asked questions
When did the €3 EU customs duty take effect?
The EU-wide duty took effect July 1, 2026. Romania's national logistics fee has been active since January 1. France's national fee is currently suspended with no confirmed reintroduction date. Italy's national fee is now scheduled for October 1, 2026.
How is the €3 EU customs duty calculated?
Per declaration line. Two identical items on the same declaration line count as one line and one €3 charge. Two items with different SKUs count as separate lines, each triggering €3, unless an HS6 grouping consolidates them. Confirm with your carrier or customs broker how your shipments will be declared.
Who is responsible for paying the customs duty?
The IOSS holder is the primary debtor. Your service provider will collect the duty when goods enter the EU and bill it back to you. Whether and how you recover it from your customer is a business decision, not a customs requirement.
Is DDU still an option?
It depends on the destination country. EU member state postal operators are each making their own decisions. Some are offering DDP only, some DDU only, and some have not yet confirmed their approach. Both DDU and DDP shipments are subject to the €3 duty. DDP is the clearer and more transparent path. Confirm the situation country by country with your carrier.
Will IOSS still work after July 1, 2026?
Yes. IOSS has not changed. It continues to handle VAT collection for eligible consignments under €150. The €3 customs duty is a separate obligation from VAT and cannot be remitted through IOSS.
Are there fees beyond the EU-wide €3 customs duty?
Yes. Romania's €5 logistics fee is already active, applying per parcel to shipments valued under €150 destined for Romania. Italy's €2 national fee is expected October 1, 2026. France's national fee is currently suspended. An EU-wide handling fee is also expected in Q4 2026, applied per declaration line by the same mechanism as the €3 duty. The official amount has not been confirmed; industry expectation based on national fee levels points to approximately €2.
What happens if a customer returns a parcel?
The €3 customs duty paid on a parcel cannot be reclaimed after the goods are released. Romania's logistics fee is also non-refundable on returned parcels. Plan your returns policy and margin calculations accordingly.
What are the new product identifier requirements?
Starting November 1, 2026, three product identifiers are required on customs declarations for all distance sale imports: the merchant product ID or SKU such as an Amazon ASIN, the non-standardized manufacturer product identifier or part number, and the standardized manufacturer product identifier such as a GTIN, EAN, or UPC where one exists. These fields are optional from July 1 with no penalties during the voluntary period. Shipments missing required identifiers after November 1 risk delays or rejection by EU customs.
