New EU Rules on Handling Fee, PIDs Take Effect

The European Union (EU) ushered in two new regulations on November 1, with each requiring ecommerce shippers into the EU to make major adjustments just as peak season is getting under way.

The €2 Union handling fee (UHF), now in effect, is applied per item for goods sold in distance sales and entering an EU country, regardless of price. This non-refundable fee is paid at the same time as the separate €3 customs duty, which is also per item but only on goods valued at €150 or less. The European Commission published the Delegated Regulation in the Official Journal laying out the UHF requirements.

The other major regulatory change is the requirement that product Identifiers (PIDs) must be included in customs declarations for all business-to-consumer (B2C) distance sales valued at €150 or less imported into the EU. Two of the PIDs are mandatory (the Merchant Product Identifier or MP and the Non-standardized Manufacturer Product Identifier or NS); and the third is required, if it exists: the Standardized Manufacturer Product Identifier (SP). 

While the €2 handling fee adds yet another cost to cross-border shipments into the EU, the PIDs requirement is proving to be the bigger headache for platforms and their service providers. The primary issue is that economic operators are not ready for the PIDs requirement, which the European Commission has acknowledged. There is no common EU database for checking PIDs. Standardized codes such as EANs can be checked for valid registration through the relevant supplier system but that requires a relationship with those suppliers. Merchant and manufacturer references depend entirely on the seller's own records. Even a valid code doesn't prove it matches the item in the parcel.

In addition, for goods shipped into the EU through the postal network, the electronic data interchange messaging system that postal operators use (known as ITMATT) cannot currently capture PIDs data. So postal operators are creating interim solutions that require some programming changes for mailers.

The European Commission told the recent Universal Postal Union meeting that while the effective date remains November 1, there will be “effective enforcement” and a collaborative approach during this first phase of the mandatory state. In practice, this means that the information required is an open text mandatory element and as long as “something” is provided, then the entry will not be rejected.