EU's e-commerce crackdown: A new era for fashion industry protection

According to a recent Financial Times report, the European Union is set to dramatically reshape the e-commerce landscape with new regulations targeting major platforms like Shein, Temu, and Amazon Marketplace. The proposed reforms would make these platforms directly liable for dangerous or counterfeit products sold through their sites - a significant shift from the current system where individual buyers bear the customs responsibility. Most notably for fashion professionals, the Financial Times reveals that counterfeiting currently costs the clothing industry approximately 12 billion euros annually, representing 5 percent of revenue.

The scale of the challenge is substantial, with the Financial Times reporting that EU imports of low-value parcels reached 4.6 billion in 2024, quadrupling from 2022 levels, with over 90 percent originating from China. To address this, the draft proposal seen by the Financial Times outlines the creation of a new central EU customs authority (EUCA) that would have unprecedented powers to screen goods before they even reach European borders. For fashion retailers and brands, this could mean significantly enhanced protection against counterfeit products entering the EU market.

The reforms also introduce important environmental considerations that could impact fashion industry operations. According to the Financial Times, platforms will be required to contribute to disposal costs for unwanted products, including clothing, as part of new waste management rules. Additionally, the current 150 euros duty-free threshold for imported goods will be eliminated, potentially affecting the pricing strategies of fashion e-commerce businesses. The Financial Times notes that while major platforms like Temu and Shein maintain they comply with existing EU regulations, they are already under investigation by the commission under separate market behaviour rules.