The European Union is accelerating its customs reform plans. On 13 November 2025, the EU Council agreed in principle to abolish the €150 duty de minimis threshold that currently exempts low-value orders from customs duty. Originally scheduled for elimination in 2028 as part of a broader EU Customs reform program, the Council has now committed to working toward a temporary solution by 2026 to begin phasing out this exemption. This means that all goods imported into the EU could soon be subject to customs duty, not just VAT.
The UK government is also reviewing its own low-value duty de minimis and has signaled that it may also remove the duty exemption for goods valued under £135. While the final decision is pending, UK Chancellor Rachel Reeves is expected to propose the elimination of the duty de minimis when she submits the Autumn Budget on November 26th.
While final legislation is still forthcoming, Passport is preparing for these possibilities to ensure predictable operations for all brands and partners.
What This Means for Cross-Border Operations
If enacted, these changes could introduce:
- Duty assessment for all consignments, even low-value parcels
- Expanded data requirements on declarations
- A simplified tariff classification system that groups low-value e-commerce goods into five “buckets” with fixed, flat duty rates ranging from 0% to 17%.
- Introduction of new handling fees for ecommerce imports (some EU member states proposed a €2 per parcel fee)
Sample Duty Rates Under Current and Proposed Structure
Passport’s Preparations and What Brands and Partners Can Expect
Passport is closely following these proposed changes and is positioned to manage these changes on behalf of our merchants and partners.
- Passport Seller-of-Record® (SOR)
Passport’s SOR® model is well positioned to adapt to the change. This means Passport can account for customs and VAT compliance changes, ensuring our merchants remain unaffected when de minimis thresholds are removed. - Passport Global In-Country Enablement
By forward-stocking inventory in the UK and EU, Brands can declare duties on inventory cost (COGS) instead of the retail price at the time of sale—reducing overall duty exposure and improving landed cost predictability. - Flexible Duty Calculation
Our systems will calculate duties using either simplified tariff buckets or full HS10 classification, depending on which method produces the most favorable or compliant outcome. - Streamlined Customs Clearance
Passport and its customs brokerage partners will operate under enhanced “Trust & Check” authorizations—a key component of the EU’s upcoming customs framework—to expedite clearance for compliant shipments and reduce administrative friction.
What This Means for You
Whether these reforms take effect in 2026 or later, Passport’s infrastructure and compliance programs are already built to support them. Our goal is to ensure that merchants, fulfillment partners, and consumers experience a smooth transition—with no change in checkout or customs clearance experience.
We’ll continue to monitor EU and UK legislative developments closely and will provide updates as specific timelines and mechanisms are finalized.
If you’d like to discuss how Passport Global’s In-Country Enablement solution can help your brand stay ahead of these changes, visit https://passportglobal.com/contact-sales/ or contact your Passport rep.
