The EU is declaring war on China’s Shein and Temu e-commerce platforms

The document “EU Comprehensive Toolbox for Safe and Sustainable E-commerce” released by the European Commission on February 5 stated that in 2024, 91% of all e-commerce goods worth no more than 150 euros entering the EU came from China, and their number more than doubled from 1.9 billion to 4.17 billion between 2023 and 2024.

This surge coincides with the rapid growth of certain online markets, especially Temu and Shein, which have shown exponential growth in the EU market. In just a few months in 2024, their number of users exceeded 75 million. Driven by pervasive online advertising, low prices and ultra-fast delivery speeds, the supply of low-value goods in these online markets has in turn stimulated strong demand.

The European Commission document stated that the European Commission proposed a “comprehensive” approach to address the risks and distortions caused by the import of large quantities of such products. Such measures require comprehensive and coordinated action, especially bringing together European institutions, member states and all national competent authorities. The European Commission is proposing joint actions in seven areas, including customs reform, consumer protection and digital tools. For example, in some cases, market platforms may also be held liable for the sale of non-compliant or dangerous products. They can be exempted from liability for sellers’ illegal acts, subject to certain conditions; in the second quarter of 2025, the Consumer Safety Network will conduct its first product safety inspection to check and enforce compliance of the most frequently ordered product categories online, and so on. The European Commission also invited co-legislators to consider further measures, such as imposing non-discriminatory handling fees on EU e-commerce goods imported directly to consumers, to address the scale costs of supervising billions of such goods to comply with EU rules. The European Commission said that the Consumer Protection Cooperation Network, composed of national consumer authorities, and the European Commission have notified Shein of the launch of the coordinated action.

The most eye-catching of the joint action is customs reform. Last year, the European Commission published a draft proposal for EU customs reform. The core of the reform is to establish an EU-wide customs administration agency, gradually replacing the decentralized systems of each member state with a centralized customs system to monitor and control the supply chain across the EU in real time. The proposal is the most ambitious and comprehensive reform proposal since the establishment of the EU Customs Union in 1968. The reform includes abolishing the tariff exemption for low-value parcels of 150 euros. The EU believes that the surge in the number of parcels is also due to the deliberate abuse of the tax exemption policy for low-value goods, and online retailers package goods in a split manner to keep the value below 150 euros.

Earlier, Trump also announced a 10% tariff on Chinese imports and canceled the “minimum” tariff exemption policy for parcels below $800. Soon, the U.S. Postal Service said it would accept parcels from mainland China and Hong Kong, China again, causing great confusion to the outside world.

On February 6, Shein issued a statement saying that it had noticed the EU’s notification on e-commerce and reiterated its commitment to cooperate with the EU Consumer Protection Cooperation Network. Shein reiterated that the company conducted more than 2 million product safety tests in 2024, which further consolidated its continued commitment to ensuring high standards of product quality and consumer safety. In 2025, Shein plans to invest more than $15 million to further strengthen its product safety testing and compliance protocols.

EU member Germany has already announced an action plan for e-commerce at the end of January. The plan requires that online trading platforms be regarded as importers. These platforms must comply with fiscal and tax regulations (including the calculation and payment of import taxes) and be responsible for the goods they send or provide. Other non-tax obligations, including product safety, can also be stipulated in other laws. The plan also clearly supports the abolition of the 150 euro tariff exemption limit and emphasizes that the abolition of existing policies alone cannot solve the current challenges in the e-commerce field. It must also be supplemented by other measures in the reform plan, such as treating online trading platforms as importers.

Including the German Retail Association and Zalando, Germany’s third largest fashion retailer, both actively expressed support for Germany and the EU’s actions, saying that “suppliers like Temu and Shein can no longer get away with it.”

Currently, Shein and Temu have encountered all-round supervision from the EU in the EU. Last October, the European Commission initiated formal procedures against Temu under the Digital Services Act to assess whether Temu violated the Digital Services Act in areas such as illegal product sales, potentially addictive service design, recommended purchase systems, and data access for researchers. A week later, under the coordination of the European Commission and the joint investigation of the Consumer Protection Cooperation Network, Temu’s several actions were deemed to have violated EU consumer law. These actions include false discounts, pressure on consumers in dark patterns, forced gamification, missing and misleading information, etc.

Faced with the great success of Shein and Temu in the European market, the European Commission said, “Europe has the ability to cope with the challenges of e-commerce imports sent directly to consumers,” “but more work needs to be done to ensure that it will not be overwhelmed by online sales and the large number of low-value goods flooding the market.”

In the eyes of the European Commission, the business models of e-commerce platforms similar to Shein and Temu are all races to the bottom. For Shein and Temu, the European Commission has more ammunition in its arsenal, and this time it is a “serial shooting”. The plan to abolish the tariff exemption for low-value packages of 150 euros is the EU’s attempt to cut off the business model of Shein and Temu.