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06 JULY 2024

CARGO FORWARDER GLOBAL

News article on EU e-commerce fee impact and logistics.

By Heiner Siegmund

Verhasselt: EU e-commerce fee to cause brief dip only

Since 01JUL26, the EU levies customs duties of at least EUR 3 per shipment on goods valued at less than EUR 150. This primarily affects e-tailers such as Temu, Shein, and others. The fees are intended to reduce the flood of small shipments coming in from online traders. Authorities have found it increasingly difficult to monitor and handle this tsunami of small parcels.

In addition, there are concerns about the many products containing ingredients that pose a health risk, particularly to children, or violations of EU safety regulations, as revealed by a multitude of inspections. Above all, customs authorities do not have sufficient staff to fulfill the task day in, day out. CargoForwarder Global (CFG) asked air freight and logistics expert, Steven Verhasselt (SV) of the Belgium-based consultancy, FB Cargo Strategy about the foreseeable implications this step will have for consumers, airports, e-tailers and the supply chain. He expects the dip will only be a short-term one and the industry adjusts.

CFG: Steven, based on your expertise as a cargo veteran: Is the EU’s decision a smart move or more of a symbolic gesture?

SV: It all depends on the target and the objective of this decision. Economies of scale are not solved by taxing the end users. Adding taxes only consolidates the advantages of the big players and throws up more barriers for new entrants or suppliers arriving late to the party.

If the objective would be to generate more revenue streams for governments, it is a smart move. I propose these are reinjected into resources for customs and systems to improve their efficiency and allow local service suppliers to create added value and jobs on the end customer markets.

CFG: Who will pay the customs duty: the online retailers or the consumers? Should the e-tailers increase the price of their goods by the fees charged by EU customs?

SV: Taxes are always paid by those at the end of the line. They will be absorbed partially over the production and logistics chain, but they will be paid by the end consumers. You can draw a comparison with other heavily taxed goods like fuel, cigarettes and alcohol.

CFG: Are the national customs authorities in EU countries technically (digitally), organizationally, and in terms of staffing, prepared for the upcoming changes? Or could there be delays at airports in the customs clearance processes for e-commerce micro-shipments starting in July 2026?

SV: The strength of a general EU rules lies, of course, in the uniform implementation of it throughout the different state members. The uncertainty concerning the legislation, the implementation and the technical requirements have made it very difficult for the cargo community to prepare for this. In cargo focused airports, the customs departments are very important members of the service community. I can only admire the hard work and flexibility of the services to be ready for this. Given the importance of streamlined processes, and the lack of information and time, one can only hope it all goes right and offers all the support needed.

CFG: If the price increases by EUR 3 per item or even more, and customers have to bear the additional costs, e-commerce volumes could decline. This would primarily affect airports such as Liège or Budapest, where e-commerce plays a dominant role. Do you anticipate this scenario affecting supply chains and air traffic?

SV: I don’t believe the EUR 3 per item, nor abandoning the de minimis rules, will have a long term effect on e-commerce volumes. There will be a short-term dip, to overcome the time needed to adjust the processes and streamline the flows. July and August are soft months anyway. That gives the cargo communities on both ends time to be ready when demand picks up again towards Q4 of the year. There might be a shift towards longer logistics chains, putting pressure on air freight, but I always believe air freight will prevail as we sell time savings, and time drives e-commerce as well.

CFG: Among others, you advise Pittsburgh (PIT), Ostend/Bruges (OST) and some other airports in cargo matters, with OST having just developed an e-commerce strategy. What should OST’s management focus on, in particular, to ensure that the flow of low-cost e-commerce commodities continues to run smoothly under the new EU customs regulations, including the fast forwarding of imported goods to end customers?

SV: Every airport in the world, advised by me or not, should always focus on infrastructure and processes to transform from a destination into a logistics platform. The airport is there to enable the cargo community to complete the door-to-door logistics operations in a cost efficient and guaranteed time defined way. How to do that depends on many factors, airport specific, national legislation specific. Putting that in place in OST, PIT, BKK and many others is what keeps us busy at www.fbcargos.com Happy to look into that as soon as the World Cup has come to an end!

CFG: Steven, thank you for your time and input.

Read original copy here.

08 October 2024

BUD Air Cargo

Steven Verhasselt was invited to attend to the BUD Air Cargo Day on 8 October 2024.  


Steven had the honor of being invited to share his insights on the future prospects of air cargo. This engagement provided a valuable platform for him to collaborate with esteemed professionals and industry leaders in the cargo sector.

Participating in this event allowed for meaningful discussions on the evolving landscape of air cargo, highlighting key trends and challenges that the industry faces. The exchange of ideas among high-ranking professionals not only enriched the dialogue but also fostered networking opportunities that can lead to innovative solutions and strategic partnerships.

The insights gained from this experience will undoubtedly contribute to our ongoing commitment to excellence in the air cargo sector. Steven's participation reflects our organization's dedication to staying at the forefront of industry developments and ensuring that we remain responsive to the dynamic needs of our clients.

We look forward to leveraging the knowledge acquired from this event to enhance our services and drive growth within the air cargo market. Thank you to all participants for their invaluable contributions and to the organizers for facilitating such an impactful gathering.

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