At the same time I sat down with Remodista last week for a deep dive into the challenges and upcoming new European e-commerce laws, Sweden decided not to wait until the end of 2020 and the new European e-commerce rules.
In my last blog I explained the double-digit growth in cross-border commercial items and the challenges for postal administrations. Well, this is how Sweden is going to solve this.
Undervalued and incomplete cross-border commercial items
As we all know, items sent from countries in the Far East are a particular challenge: in many cases the items lack a verifiable sender’s declaration, correct details of the value, description of content, or correct VAT registration based on a correct identification number. It is usually impossible to ensure that the lawful VAT is paid in the country of the recipient.
From March 1 all items will have VAT applied
More than 75% of all commercial items weigh less than 2 kg and are valued at under €150. Sweden is like an average western and central European country, were larger EU states are having to process significantly more than 100.000 cross-border low value commercial items every day. On a very short notice of just two weeks Sweden will start invoicing the Swedish consumer who ordered cross-border outside of Europe. In the event that the recipient does not want to pay the VAT and the fee for the VAT declaration, the consignment will be returned to the sender.
Sweden is going to implement a new additional EUR 7.50 fee per shipment
All mail items with a declared value that come from outside the EU Customs Union will have VAT applied to them from the first cent (SEK 1), usually at a rate of 25 percent. According to PostNord Head of Corporate Affairs Thomas Backteman, “ It is very good that we have been able to agree on a solution for how the levying of VAT on such a large volume of mail items can be handled”.
At the same time, Sweden will start with the new fee model involving a lower fee than the current € 12,50 (SEK 125), including VAT, will be introduced. A fee of € 7.50 (SEK 75) will be charged for consignments with a declared value of less than € 150 (SEK 1,500).
“Establishing a process that can handle the huge volumes involved over the course of just a few weeks has not been easy. But on the first of March we expect to have the process in place and the new handling fees will apply,” continues Thomas Backteman.
How to avoid these European e-commerce challenges?
I my blog about expanding your retail presence in Europe I spoke about avoiding the anonymization of your brand being a faceless, nameless product in a sea of products and the customer journey into Europe.
If you are looking for a better and compliant solution to avoid and or automate these kinds of new rules in your checkout or you want to improve and stay in control of the customer journey into Europe, consider the benefits of working with a partner who can help.
GO EU Commerce is an easy-to-use, cost-effective ecommerce platform that provides shipping and logistical solutions for organizations doing business in Europe. GO EU Commerce is equipped to handle all challenges most businesses will encounter – even businesses without European registration
Contact us via our website or send an email to firstname.lastname@example.org and we are more than happy to schedule a call how our easy-to-use, cost-effective and compliant ecommerce platform can help you doing more business in Europe.