Low-Value Parcel Rules 2025: How China-Origin Imports to the U.S. & EU Are Changing
Introduction
For businesses that consolidate, forward, or import goods from China into Europe or North America, 2025 marks a major inflection point. The longstanding “low-value parcel” regime — that allowed cheap goods (often China-origin) to cross borders with minimal duty or compliance — is being rewritten. In the U.S., the De Minimis exemption has been eliminated. In the European Union (EU), the threshold that allowed parcels under €150 duty-free is being scrapped. These changes mean substantial cost, logistics and compliance implications for China-origin small-parcel flows.
In this article we will:
- Map exactly what has changed in the U.S. and EU for low-value parcels from China.
- Unpack the practical implications for consolidators, forwarders & merchants.
- Outline strategic responses and operational adjustments you must make now.
- Provide a 90-day action plan.
- Highlight what risk signals you should monitor.
1. What’s Changing: The U.S. & EU Frameworks
1.1 United States – End of De Minimis for China and then All Countries
The U.S. has taken decisive action:
- On 2 May 2025 the White House issued an executive order eliminating duty-free de minimis treatment for parcels from China & Hong Kong. The White House+1
- By 29 August 2025 the exemption was eliminated for all countries, meaning virtually no parcel under the previous threshold enters duty-free. www.hoganlovells.com+2DHL+2
- For postal items from China, new duties were introduced: e.g., an ad valorem duty or a specific fee per item depending on origin and tariff rate. avalara.com+1
- The prior threshold allowing goods valued under USD $800 to enter with minimal formalities is gone for Chinese origin shipments. www.hoganlovells.com
This changes the cost-structure for China-origin small parcels to the U.S. Almost overnight, the “cheap parcel” model has become far more complex and costly.
1.2 European Union – Abolition of €150 Exemption & Imposition of New Duties/Fees
In the EU the shift is equally sweeping:
- The EU Council announced that the exemption allowing goods worth under €150 to enter duty-free will be abolished. 欧盟理事会+2euronews+2
- Finance ministers agreed that starting as soon as 2026, customs duties will apply to all goods, closing the “low-value parcel loophole” mostly used by China-origin shipments (91% of parcels valued under €150 in 2024 came from China). euronews+1
- The change is part of a broader overhaul of EU customs systems, aimed at bringing in full duty/clearance even for small parcels. FreightWaves
For China-origin parcels entering Europe, this means the historical advantage of low-value direct parcel shipping is eroding rapidly.
2. Implications for China-Origin Parcel Flows & Consolidation Models
2.1 Landed Cost Shock for Small Parcels
- For shipments from China into the U.S. that once benefitted from duty-free entry, the new rules mean duties, taxes, and formal entry costs now apply. This drives up landed cost substantially.
- In the EU similarly, parcels under €150 will no longer skip duties. Result: marginal SKUs (low value, low margin) are now at risk of becoming uneconomic.
- Forwarders and consolidators must therefore revisit their cost modelling: freight, duty, customs clearance, handling, last-mile delivery, returns — all cost lines now matter more than ever.
2.2 Logistics & Operational Disruption
- Many models built on China → consumer direct parcel delivery (especially via e-commerce) are challenged. Some carriers or postal networks may suspend or reroute parcel flows as compliance burdens increase.
- Forwarders will need to shift more to bulk consolidation (China → hub → local delivery) rather than many individual small parcels directly.
- Compliance complexity increases: accurate origin, HS codes, value declarations, duty payment, greater customs oversight.
2.3 SKU Portfolio & Sourcing Strategy Impacts
- Ultra low-value SKUs (say < US$20 or < €15) are now under siege: the margin buffer is eroded by duty/fee impact.
- Merchants must segment SKUs:
- Tier A: High value/high margin → still viable despite cost increases
- Tier B: Mid value/moderate margin → needs optimisation of route/logistics
- Tier C: Low value/low margin → may require bundling, regional warehousing or discontinuation
- Sourcing strategy may shift: reduce reliance on China small-parcel direct flows; consider near-shoring or regional fulfilment to absorb duties/handling cost.
2.4 Compliance & Partner Risk
- Carriers/forwarders who cannot manage the new duties, data-submission, formal entry requirements will become risk points.
- Consolidators must partner only with providers that handle duty payment, classification, customs clearance smoothly.
- Non-compliance or errors can lead to parcel seizures, refunds, customer dissatisfaction and higher cost.
2.5 Competitive Landscape & Strategic Advantage
- Those who adapt early (bundle shipments, optimise logistics, shift fulfilment model) will gain an advantage over those relying on low-value direct parcel shipping from China.
- E-commerce platforms relying heavily on China small parcel flows into the EU or U.S. (such as SHEIN and TEMU) are under immediate pressure. Their logistic model may need fundamental redesign. EMARKETER+1
- Consolidators who proactively restructure will be in a strong position to win business from clients whose old models are now failing.
3. Strategic Responses: What Forwarders, Consolidators & Merchants Must Do
3.1 Reconstruct your Cost & Risk Models
- Build detailed landed-cost per parcel and per SKU including duty + freight + handling + last-mile + returns.
- Segment SKUs by margin/volume/time-sensitivity and assign logistic fulfilment strategy accordingly.
- Introduce duty/fee risk buffers in pricing: assume worst-case duty or additional handling cost for small parcel flows from China.
- Use scenario modelling: e.g., “What if duty +30%?”, “What if parcel lead-time +50% due to customs checks?”.
3.2 Rethink Logistics & Fulfillment Strategy
- Shift from China direct small parcel → to model: China consolidation hub → bulk import → regional (EU/US) warehouse → local delivery. This helps absorb duty/handling cost and reduce risk.
- Introduce larger parcel batching or minimum order thresholds to make duty/handling cost per unit viable.
- Evaluate part-shipping of mid-volume SKUs via sea or rail into hubs rather than many small parcels.
- For consumers in North America and Europe: consider offering “warehouse-fulfilment” option (which may have higher shipping cost but lower duty/handling exposure) vs “direct China parcel” option (which now carries higher risk/cost).
- Communicate clear shipping tiers and duty/payment expectations to end-customers or sellers.
3.3 Strengthen Compliance & Documentation
- Ensure accurate HS codes, value declarations, origin statements for China-origin goods.
- Ensure carriers/forwarders are authorised and capable to pay duties, file entries and handle customs data.
- Set up compliance audits for China suppliers (e.g., certificate of origin, input source, manufacturing site) and logistic partners.
- Build documentation process flows for small-parcel shipments (even low value) because the clearance burden is increasing.
3.4 Pricing & Customer Communication
- Inform clients (sellers or merchants) about changed cost base (duty/handling) and adjusted landed cost expectations.
- Consider “landed cost inclusive” pricing to avoid surprise duty + shipping charges at customer end.
- Use bundling or minimum order value (MOV) to reduce per-unit cost of compliance/duty.
- Segment markets: perhaps higher landed cost SKUs for premium markets; less focus on ultra-low-value SKUs for margin sensitivity.
3.5 Monitoring & KPI Governance
- Track key metrics: landed cost per parcel/SKU, duty/fee per unit, parcel volume trend from China, lead-time variance, cost to serve.
- Monitor regulatory developments: U.S. CBP guidance, EU customs reforms, dates when new rules take effect.
- Set triggers: e.g., if landed cost increases > X%; if parcel volume from China drops > Y%; if duty/fee event is announced.
- Maintain agility: update your logistics strategy every quarter as regulatory/freight environment evolves.
4. 90-Day Action Plan
| Timeframe | Key Actions |
|---|---|
| Days 0-30 | • Audit your current China-origin small-parcel flows: volumes, SKU value, margin, destination markets (EU vs U.S.). • Build updated landed cost models for those flows including duty/fee, clearance, shipping, last-mile. • Segment SKUs by value/margin and identify which small-parcel flows are at risk. • Engage with forwarder/parcel/carrier partners: ask about duty handling, customs entry readiness, cost increases. • Communicate to clients/sellers about upcoming changes in duty/handling exposure for China-origin parcels. |
| Days 31-60 | • Pilot shift of selected SKUs: move from many small parcels from China → to consolidated hub shipment then regional fulfilment (EU or US) and compare cost/time. • Introduce or revise minimum order values or bundling requirements for small-parcel flows. • Review and update compliance framework: documentation, HS codes, origin declaration, carrier submission. • Track and compare landed cost, lead-time, customer satisfaction, margin for pilot vs old method. |
| Days 61-90 | • Evaluate pilot results and finalise strategy: decide which SKUs remain small-parcel direct China, which migrate to hub/warehouse model, which are removed. • Revise contracts with forwarders/carriers to include duty/fee pass-through clauses and clarity on small-parcel/duty handling. • Update pricing or service tier structure: create “warehouse-fulfilment” vs “direct China parcel” options with clear cost/lead-time trade-offs. • Establish monthly dashboard to monitor landed cost per SKU, parcel volume from China, duty/fee exposure, and adjust strategy accordingly. |
5. What to Monitor & Risk Signals
- Duty or fee announcements: e.g., U.S. CBP or EU Council introducing new thresholds/rules.
- Parcel flow drop off: if China-origin small-parcel volumes begin to fall markedly, it’s an early sign of cost/route stress.
- Lead-time spikes or clearance delays: if customs clearance gets tougher, then cost or inventory risk grows.
- Margin erosion on low-value SKUs: if landed cost rises and conversion falls, the SKU may no longer be viable.
- Carrier/Forwarder issues: if carriers start refusing China-origin small parcels due to compliance or cost burden, you may need alternate partners.
- Customer/reseller push-back: if higher landed cost or duty surprises cause cart abandonments or returns.
Conclusion
The era of ultra-low-cost, China-origin small parcels entering the U.S. or EU duty-free is ending. The regulatory and logistics environment is shifting fundamentally. For forwarders, consolidators and merchants working with China-sourced goods, the new normal demands adaptation: cost modelling, logistics strategy, compliance frameworks and customer communication must all be upgraded.
Those who act early — reorganising their flows, adopting regional fulfilment hubs, revising pricing and minimum order thresholds, strengthening documentation and compliance — will be ahead of the curve. Those who assume “business as usual” may face margin squeeze, service disruption and a failing model.
In short: the low-value parcel loophole is closing. Prepare now, adapt your model, and turn this disruption into an advantage.
