EU Cross-Border E-Commerce Overhaul: Mandatory Local Warehousing & VAT Changes for Non-EU Sellers (2025)

The European Parliament has adopted a resolution that potentially marks the beginning of a new chapter for cross-border e-commerce.

Under the measures outlined in the Product safety and regulatory compliance in e-commerce and non‑EU imports resolution (Report A 10‑2025‑0133/2025), non-EU sellers could face a fundamentally different operating environment in the European Union.

While the final implementation date and transitional details are still subject to further review and adoption by the Council of the European Union, platforms such as Amazon and Temu have already begun adjusting their logistics and compliance frameworks in anticipation of the changes.

The message is clear: there is a clear shift towards greater regulatory scrutiny, and businesses operating in the EU market must act now to prepare for the upcoming changes.  

The New Proposal: Three Major Regulatory Shifts

• Mandatory local warehousing for all non-EU sellers

The most impactful change is the requirement for non-EU sellers to establish or lease local warehousing within the EU.

Under the proposed system, products must first be delivered to a local facility within the EU for storage and inspection before being distributed to EU consumers.

This change is designed to improve enforcement of EU product standards.

According to data from Dutch Customs, 84% of the 3 million parcels processed daily are classified as transit shipments. The new regulation aims to reduce customs avoidance, speed up inspections, and improve the traceability of goods.

Amazon, Temu, and other major online platforms have already begun making changes to their fulfilment procedures by requiring sellers to dispatch from local warehouses and offer EU-based return addresses. Listings that do not meet these standards may be de-prioritised or restricted.

• Abolition of the €150 import VAT threshold and customs exemptions

Currently, goods valued below €150 are exempt from VAT and customs duties upon import into the EU.

The proposals would remove this exemption entirely, meaning that all imports, regardless of value, would be subject to full VAT (ranging from 19% to 27%, depending on the Member State) and customs duties (for example, 12–15% for clothing).

This change is aimed at addressing fraudulent under-declaration, which the European Commission estimates affects around 65% of low-value parcels entering the EU.

Sellers will need to adapt their pricing and supply chain strategies accordingly.

• New parcel handling fee structure

Under the proposals, a new €2 handling fee per parcel would apply to direct-to-consumer cross-border shipments. However, parcels processed through local EU warehouses will benefit from a reduced fee of €0.50 per item.

The financial incentive is clear – under the proposed costs, a seller dispatching 100,000 units per month could save over €180,000 per year by transitioning from direct shipping to local fulfilment models.

Four Key Areas of Compliance

To prepare for the upcoming changes, we recommend that businesses review their operations across four areas of compliance:

• Warehousing compliance and operations

Sellers must ensure that their chosen storage facilities are fully licensed and approved by the respective customs authorities (e.g. Dutch Customs for facilities in the Netherlands).

Licenced facilities will be subject to regular inspections covering product safety, environmental regulations, and customs documentation.

For smaller sellers, using shared warehousing models such as Amazon’s Pan-European FBA programme will provide a cost-effective option to access multi-country fulfilment. 

• VAT and customs compliance

Storing inventory within any EU warehouse usually triggers the obligation to register for VAT in that country.

With the exemption on low-value goods removed, even low-value items must be correctly declared and taxed.  This is likely to make the VAT declaration process more complicated.

It is strongly recommended that sellers consult with experienced advisors for accurate tax calculations and filing.

• Product compliance: EPR and EURP requirements

Non-EU sellers must also address their obligations under Extended Producer Responsibility (EPR) and the General Product Safety Regulation (GPSR).  These are separate legislative measures that are expected to be strengthened, with greater regulatory oversight and enforcement.

For example:

• • EPR Registration: Under the new EU Battery Regulation, sellers must register for EPR compliance in each destination market by 18 August 2025, or risk product delisting or bans
  • EU Responsible Person: Businesses without a legal presence in the EU must appoint an EU-based Responsible Person (EURP) to handle compliance and regulatory matters. Failure to do so could result in product seizures, removals or financial penalties.

• Platform policy changes

Amazon has recently made some changes to its Pan-EU programme, adding the Netherlands as a mandatory marketplace.

As of 25 June 2025, any ASIN newly enrolled in the Pan-EU programme must also be listed on the Amazon Netherlands marketplace to ensure eligibility.  Although VAT registration is not yet required, EPR regulations still apply.

Additionally, both TikTok Shop and Temu now require local warehousing and return addresses within the EU – this will usually require VAT registration in the selected country.  Non-compliance may lead to reduced visibility or platform-based penalties (e.g. seller suspension).

Planning for 2025 and beyond – ongoing compliance with TBA Global

With extensive experience in EU taxation and product compliance, TBA Global is here to guide you through the new regulatory landscape.

Whether you need support with VAT registration, warehousing compliance, EPR, or CE certification, our team provides expert solutions tailored to your business.