In a move to curb the influx of ultra-low-cost goods from China, the European Union is preparing to impose customs duties on inexpensive items purchased from Chinese online retailers such as Temu and Shein.

The Financial Times reported on Wednesday that Brussels is drafting plans to eliminate the current €150 duty-free threshold for imported goods.

According to sources familiar with the matter, the European Commission will propose this change later this month. The primary targets of this measure are Chinese online marketplaces Temu and AliExpress, along with clothing retailer Shein.

Commission data reveals a significant surge in e-commerce imports, with over 2.3 billion items below the duty-free threshold entering the EU last year. This number has more than doubled year-on-year, reaching approximately 350,000 items in April alone—nearly two deliveries per household.

The proposed legislation would apply to all online retailers shipping directly to EU customers from outside the bloc. Additionally, the Commission is considering making it mandatory for large platforms to register for VAT payments online, regardless of the value of goods sold.

Christel Delberghe, director-general of EuroCommerce, a retail lobby group, expressed support for the initiative, stating, "We want an EU-level playing field in online retail for all players targeting EU-based consumers, no matter where they are established."

The EU's move comes amidst growing concerns over product safety. The number of dangerous products reported by EU countries increased by more than 50 per cent from 2022 to 2023, totalling over 3,400 items. Cosmetics, toys, electrical appliances, and clothing were among the products with the most safety issues.

In response to these developments, Temu stated, "Product safety is of paramount concern to us and we have strengthened the monitoring of this product group and its associated requirements." Similarly, AliExpress and Shein expressed their willingness to cooperate with EU legislators.

While the proposal aims to address safety concerns and level the playing field for EU-based retailers, some officials caution that implementation could prove challenging, potentially increasing the workload of already overburdened customs officials.

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