EU Customs Duty 2026: A Guide for Malaysian eCommerce Sellers

From 1 July 2026, the European Union (EU27) removed the de minimis rule, its duty-free treatment for low-value goods valued at €150 or less. A new flat customs duty now applies to e-commerce shipments entering the region.

For Malaysian businesses selling to EU consumers, this brings more than added duty costs for your customers. There are also changes to the customs process and extra information required from you when you arrange a commercial shipment.

To help you keep doing business smoothly with the EU, we have put together a complete guide covering what you need to know and do under these new rules:

1. Summary of EU 2026 customs reformation
2. How customs duty is calculated under this new rules
3. The new customs process B2C shippers should know
4. Things to know when shipping with DHL Express

EU27 countries: Austria, Belgium, Bulgaria, Croatia, Republic of Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, and Sweden.

What changes in the customs process for B2C sellers

The reform changes how your B2C shipments are cleared.

The change runs across the whole journey, from booking to declaration to clearance. As an e-commerce seller, you only need to focus on providing the right information. Your international courier handles the rest.

The core process of how you book a shipment and how it travels stays mostly the same.

What changes sits in four places:

1. The information needed at booking
2. Who holds legal responsibility as the declarant
3. How clearance is handled
4. How refunds work on returns.

Only the first needs action from you. The other three are changes to stay aware of, with no action needed from you as a shipper. 

Shipment booking

Shipping information required at booking remains the same. You provide an accurate description, value, quantity, HS code, and delivery details.

On top of the core shipment informations, which includes the description, value, quantity, HS code, and delivery details, two points need extra attention.

First, provide the HS code at the right level.

For IOSS shipments (if you are an IOSS holder or you sell through a marketplace that uses its own IOSS), a 6-digit HS code is required.

For shipments without IOSS, and for prohibited or restricted (P&R) goods such as alcohol, tobacco, excise goods, or items needing a licence, a full 10-digit HS code and country of origin are required.

Second, from November 2026,  every declaration line item also needs a Product Identifier (PID), a code that identifies a specific product.

Three types of PID apply once the requirement takes effect:

1. Merchant PID (mandatory): identifies the seller, marketplace, or platform behind the order. Usually your internal SKU, item code, or product code.
2. Non-Standardised Manufacturer PID (mandatory): the manufacturer's own internal code for the product, such as their SKU or article number, where no global standard applies.
3. Standardised Manufacturer PID (only if one exists): a globally recognised code such as a GTIN, EAN, MPN, or barcode number.

The first two are always required. The third is required only when the product actually has a global standard code. If it has one, you must provide it. If it does not, the first two are enough.

Declarant of Import into EU

Previously, for many low-value clearances, responsibility for the declaration sat with the final consumer, and your courier filed it in your customer's name.

Under the reform, for IOSS shipments the IOSS holder becomes the declarant and is legally responsible for the clearance.

Whether you are named as the declarant depends on how you sell:

• Selling through a marketplace: the marketplace is the IOSS holder and the declarant. You carry no declarant responsibility.
• Selling direct with your own IOSS: you are the declarant. Your courier will ask you for your details (name, address, EORI, VAT ID, and confirmation of who acts as importer).
• Selling direct without IOSS: there is no IOSS declarant, and VAT and duty are handled at the border.

Note: The execution of this change is handled automatically by your courier. No action is required from shippers.

VAT charge

The process remain the same as the ongoing practice.

For goods valued at €150 or less, VAT is collected at checkout through IOSS (if you hold IOSS, or sell through a marketplace that uses its own IOSS), or at the border (if you are not registered for IOSS).

Clearance process

Two things changed here, and both are operational, so your courier handles them fully.

First, low-value B2C parcels can no longer be cleared together as a consolidated group. Each parcel is cleared individually.

Second, non-IOSS B2C shipments (≤€150) must be cleared in the destination country where your customer is, not at the first EU point of entry.

What this means for you as an e-commerce seller is that each parcel is now cleared on its own data. Every parcel must carry complete standalone information, including its own value and its seller and buyer details. You can no longer rely on one dataset covering a consolidated batch.

This mainly affects non-IOSS direct sellers, while marketplace and IOSS sellers are less affected.

Duty refund on returns

Before the reform, customs duty paid on a returned B2C order could be reclaimed under normal refund rules.

From 1 July 2026, customs duty on B2C returns valued at €150 or less is no longer refundable. Once the €3 duty is paid on a low-value B2C shipment, it stays paid, even if the customer sends the item back.

Two things stay the same: VAT refund rules for B2C returns continue as before, and duty refunds still apply for defective goods, B2B returns, and non-distance sales.

Before the 2026 EU reform, when a B2C order was returned, any customs duty paid could be reclaimed under normal refund rules. From 1 July 2026, customs duty on B2C returns valued at €150 or less is no longer refundable.

Once the €3 duty is paid on a low-value B2C shipment, it stays paid, even if the customer sends the item back.

However, two things remain the same:

1. VAT refunds are not affected. The existing VAT refund rules for B2C returns continue as before.
2. Duty refunds still apply in three cases: defective goods, B2B returns, and non-distance sales.

Across every step above, the quality of the data you provide at booking is what decides how smoothly your shipments move.

Be sure to show the retail value of the goods on your commercial invoice, since value is what duty and VAT are assessed against, and review your commercial invoice process before you ship. 

What to Know When Shipping with DHL Express

We handle the customs clearance for you, as always. Once your shipment data is complete and accurate, we prepare and file the declaration on your behalf.

Under these new EU customs rules, all you need to do is provide the required information when you book.

1. Provide accurate shipment information and the right HS code

On every shipment, make sure each product line carries a clear description, the correct value, and the HS code at the right level of detail.

If you ship with IOSS, a 6-digit HS code applies to most shipments.

If you ship without IOSS, or you ship prohibited and restricted goods, a 10-digit HS code applies.

Because the €3 duty is charged per HS code, an accurate code on each distinct product keeps your duty calculated correctly. If anything is missing or incorrect, the shipment may be delayed or returned.

2. Provide Product Identifiers (PIDs) on each product line

From November 2026, the three Product Identifiers covered above will be needed when you book a shipment with DHL Express.

How you provide the information depends on how you ship with us:

• If you book manually in MyDHL+, you add the PIDs on screen when you create the shipment, on each product line alongside the other details. We are releasing guidance on exactly where these fields appear, so from November 2026 follow the fields shown when you ship. There is nothing to prepare in advance.
• If you ship through an integration (e.g. eCommerce platform, order system, or a shipping tool), the PID fields are added to the shipment data your system sends us. This is usually a one-time setup handled by the system owner or your IT team.

3. Provide and confirm your IOSS details

If you sell direct into the EU with your own IOSS, we will contact you for the details we need to clear your goods, such as your name and address, EORI number, VAT ID, and confirmation of who acts as the Importer of Record.

Frequently Asked Questions