On 22 February 2024, the European Union (EU)'s Internal Market Committee adopted its position on the EU Customs Code reform that will restructure the way customs authorities work in the EU.¹ The proposed reforms include: (i) a new approach to e-commerce for goods coming from outside the EU, (ii) more efficient customs checks and targeted controls and (iii) a new EU DataHub for the submission of information to EU customs authorities.

The EU Customs Code reform

The EU Commission presented the EU Customs Code reform proposal in May 2023. The package contains three separate legal acts:

1. The main regulation, which establishes the EU Customs Code and the EU Customs Authority
2. A Council regulation on simplified tariff treatment for the distance sales and elimination of the customs duty relief threshold
3. A Council directive on a special scheme for distance sales of goods imported from third countries and import value added tax (VAT)

The EU Parliament acts as a co-legislator on the first act.

The proposed reform aims to relieve customs authorities that have come under pressure due to the exponential growth of e-commerce and many new product standards, bans, obligations and sanctions that the EU has put in place in recent years.

The proposed reforms include:

• A new approach to e-commerce and ordering goods from outside the EU — Large platforms would be required to submit information about goods to be shipped to the EU within one day of the purchase.
• More efficient customs checks and targeted controls — A new multi-level system of trusted traders aims to ensure that authorities do not lose time checking legitimate businesses but focus on riskier businesses instead. Companies agreeing to go thorough preliminary checks and vetting would benefit from various simplified procedures. The most trustworthy and transparent companies would receive trusted trader status, which would enable them to undergo minimal checks and customs formalities.
• New information technology platform — The new law would establish an EU DataHub as the main platform for submitting information to EU customs authorities, replacing more than 111 systems currently used in the EU.

Members of the European Parliament endorsed the Commission's proposal while amending it to further simplify procedures,² clarifying data processing and accessibility, creating a platform for whistleblowers, making the new EU DataHub available earlier than proposed, facilitating trade and lessening associated burdens, particularly for small and medium-sized enterprises.

Next steps

Now that the committee has adopted the draft report, an upcoming plenary session of the European Parliament (most likely in March) will review and vote on the report; this will constitute Parliament's position at first reading. The file on the draft report will be followed up by the new Parliament after the European elections in early June 2024.