If your business sends orders to customers in the EU, you've probably heard rumblings about new customs rules coming next year. We won't sugarcoat it, there are some real changes on the horizon that will affect your costs and how you run your shipping.
The good news? If you know what's coming, you have time to prepare. So let's break it all down in plain English.
The big one: the €150 duty-free threshold is gone
Right now, parcels valued under €150 entering the EU don't attract customs duties. It's been that way for years. But from 1 July 2026, that exemption is being scrapped entirely.
Why? The EU has been watching the volume of cheap parcels pour in, around 4.6 billion low-value shipments in 2024 alone with about 91% coming from China. The duty-free loophole as critics called it gave a huge pricing advantage to overseas sellers and cost EU governments significant revenue. Something had to give.
The result: from July, every commercial parcel entering the EU, no matter the value, will be subject to customs duties.
So what does it actually cost?
For goods under €150, the EU is introducing a flat €3 duty per item type (technically, per "tariff heading") in each parcel. So if you're sending a single product type, it's €3. Send two different product categories in one order and you're looking at €6. And so on.
Think of it this way: a customer orders a hoodie and a cap from your store. Those likely fall under two different tariff codes, that's €6 in duties before you've even accounted for VAT.
This flat-rate approach is temporary, it's a bridging measure while the EU rolls out its new Customs Data Hub which should be fully up and running by 2028. After that standard tariff rates kick in for all imports under €150.
It could get pricier depending on where you're shipping
The €3 EU duty isn't the full story. Several member states are adding their own national charges on top:
Italy has introduced a €2 handling fee per low-value parcel as part of its 2026 budget.
Romania has introduced a 25 RON (approximately €5) administrative processing fee per low-value parcel, effective January 2026.
France now levies a €2 "taxe sur les petits colis" charge on low-value imports under €150, effective 1 March 2026.
An EU-wide €2 handling fee per parcel is targeted for November 2026.
When you add it all up some shipments could attract €5 or more in combined fees and duties per parcel. For lower-value products, that's a meaningful hit to your margins or your customer's wallet.
What should you actually do about it?
The good news is that July 2026 is still a few months away, which gives you a real window to adapt. Here's where we'd suggest starting:
Check your HS codes. The €3 duty is applied per tariff heading, so accurate commodity codes matter more than ever. Vague or incorrect codes can mean higher charges or delays at customs.
Revisit your pricing. Will you absorb the new duties or pass them on? Neither answer is wrong but you need a clear position and your customers need to know what to expect at checkout.
Be upfront with customers. If there are additional import charges, show them clearly before they complete their order. Surprise fees on delivery are one of the fastest ways to lose a customer.
Think about your fulfilment model. When similar de minimis changes hit the US in 2025, many businesses shifted from shipping DDU and started using DDP. If you'd rather not manage the duty piece yourself, Hutch can handle EU shipments on a DDP basis, so duties are settled before your customer's order arrives, with no unexpected charges at the door.
DDP vs DDU: who actually pays the new charges?
One question every brand shipping to the EU needs to answer before July is: who foots the bill for the new levy?
The answer depends on whether you ship on a DDP or DDU (also called DAP) basis.
DDP - Delivered Duty Paid means you, the seller, pay all import charges upfront. Duties, VAT and any national handling fees are settled before the parcel arrives at your customer's door. The customer receives their order with no unexpected charges and nothing more to pay. It's the cleaner customer experience but it means the new €3 EU levy (plus any applicable national fees) lands on your cost base.
DDU/DAP - Delivered Duty Unpaid means the charges are the customer's responsibility on arrival. When the parcel clears customs, the carrier contacts the recipient to collect the duties before releasing the shipment. From July 2026 that bill will now include the €3 EU Small Parcel Levy on top of VAT plus any country-specific fees so a customer in Italy for example could be hit with €7 or more in combined charges before they receive their order.
This matters because the levy is a customs duty, not VAT. That's an important distinction. If you use IOSS, your VAT is already collected at checkout and remitted centrally, great. But IOSS does not cover customs duties. The Small Parcel Levy sits entirely outside of IOSS and cannot be reported or paid through your IOSS return. It must be handled separately regardless of how your VAT is managed.
For brands currently shipping DDU who have relied on the duty-free threshold to keep landed costs low, July 2026 changes the maths significantly. A parcel that previously arrived duty-free could now generate a customs demand that your customer wasn't expecting, which often means refused deliveries, abandoned orders and damaged trust.
The practical options are to absorb the duty into your pricing and move to DDP, pass it transparently to customers at checkout or reconsider whether cross-border shipping parcel-by-parcel still makes sense for your EU volumes at all.
The bottom line
These changes affect around 93% of current Ecommerce flows into the EU. That's not a niche issue, it's a fundamental shift in how cross-border Ecommerce into Europe is going to work.
The businesses that come out ahead will be the ones that take the time now to understand the impact on their specific product mix, their pricing and their logistics setup before July arrives and the new rules bite.
If you're not sure how these changes will affect your EU shipping, our team at Hutch Logistics is happy to talk it through. We work with Ecommerce businesses every day on exactly these kinds of challenges including managing DDP shipping into the EU so your customers never face unexpected charges at the door. Feel free to get in touch.
This article reflects the regulatory landscape as of March 2026. Specific fee amounts and timelines remain subject to change as EU legislative processes evolve.
Published by Hutch Logistics
Helping growing Ecommerce brands deliver world-class fulfilment experiences.
