France urges fees on cheap e-commerce parcels in EU

By Helen Reid

LONDON (Reuters) - Fees should be charged on low-value e-commerce packages coming into the European Union from next year, France said on Tuesday, as it seeks greater controls on online platforms such as Shein and Temu that ship cheap items to European consumers duty-free.

The EU plans to scrap its duty-free treatment of packages ordered online that are worth less than 150 euros ($171), but not until 2028, so France's proposal of handling fees is a transitory measure to help fund tighter customs screening.

France is among those who want rapid action, especially as the United States, the biggest market for both Shein and Temu, has scrapped its "de minimis" policy that allowed duty-free entry to parcels worth less than $800, effective this Friday.

Any imposition of fees would have to be agreed by the EU as a whole and applied across all member states.

European retailers and policymakers have grown increasingly critical of the duty-free policy they say gives Shein and Temu an unfair advantage by helping them sell products from dresses to smartphones at rock-bottom prices.

These products are shipped directly from factories in China and their duty-free status means there are fewer checks on their safety and compliance with the bloc's rules.

"This poses a risk to the French, because the products are dangerous, to brands because of massive counterfeiting, and to public finances because the diversions are also major," Budget Minister Amelie de Montchalin said at a press conference as she and Finance Minister Eric Lombard visited a parcel depot at Charles de Gaulle airport.

Collecting fees on each small parcel would help fund tighter customs controls at the EU level, de Montchalin said, adding that she will be in Brussels in the coming weeks to discuss the proposal with her counterparts from the Netherlands and Germany.

"We are in a customs union, so we cannot act alone," said Lombard. Around 1.5 billion e-commerce packages are shipped to French consumers every year, and about 800 million of those are worth less than 150 euros, he said.

In a statement, Shein said it respects all the laws and regulations across its markets, including France, and that its success is not down to the duty-free allowance.

Temu did not immediately respond to a request for comment.

France plans to massively increase the number of parcels it screens, aiming to check as much as three times the current level, and will publish lists of products it withdraws from online platforms over breaches of regulations, trade and small business minister Veronique Louwagie said.

($1 = 0.8787 euros)

(Reporting by Helen Reid and Dominique Patton; editing by Barbara Lewis and Emelia Sithole-Matarise)