Author: Daniela Serra Castilhos
Date: 17-12-2025
Illicit trade affects all dimensions of contemporary societies, from economic stability and consumer safety to environmental sustainability and security governance. While often discussed in relation to drugs, weapons or human trafficking, illicit trade is increasingly embedded in everyday consumption patterns, particularly through cross-border e-commerce. The European Union’s recent decision to introduce a customs duty on low-value e-commerce parcels and to accelerate its broader customs reform marks a significant milestone in addressing this evolving challenge in a more systemic and holistic way.
For years, parcels valued below €150 imported directly to consumers in the EU benefited from a customs duty exemption. Originally intended to reduce administrative burdens, this exemption unintentionally created vulnerabilities. The explosive growth of e-commerce – reaching billions of parcels annually –has strained customs authorities and opened channels for under-declaration, misclassification of goods, counterfeit products, and the circumvention of regulatory standards. These practices blur the line between legal trade and illicit trade, illustrating how “illicitness” often emerges from regulatory gaps rather than overt criminal intent alone.
The introduction, from July 2026, of a €3 customs duty per item on low-value e-commerce consignments is therefore more than a fiscal measure. It is a governance response to the structural pressures generated by globalized digital markets. By removing the long-standing exemption, the EU aims to level the playing field between online platforms – often based outside the Union – and European businesses that comply with customs, tax, labour and product safety rules. In doing so, it addresses a core driver of illicit trade: unequal regulatory environments that incentivize non-compliance.
From a GLITSS perspective, this development is particularly relevant because it connects all three dimensions of illicit trade research. First, it targets the phenomenon itself: the large-scale flow of undervalued or non-compliant goods that undermine legitimate markets and facilitate the circulation of unsafe or counterfeit products. Second, it addresses the platforms behind illicit trade, notably digital marketplaces and fragmented data systems that have so far limited customs authorities’ visibility and capacity to assess risks effectively. Third, it strengthens responses to illicit trade by combining enforcement tools with regulatory innovation and digital transformation.
At the heart of the EU customs reform is the creation of a European Customs Authority and an EU Customs Data Hub, expected to become operational by 2028. This centralized digital infrastructure will fundamentally change how customs data are collected, shared and analysed across Member States. Businesses will submit information once, through a single digital interface, while customs authorities will gain a comprehensive, real-time overview of import activities. Such a system enhances risk management capabilities and allows authorities to identify suspicious patterns more effectively – an essential step in combating illicit trade embedded in complex supply chains.
Importantly, the reform also reflects a growing recognition that technology plays a dual role. Digital platforms and fast logistics have facilitated the scale and speed of illicit trade, but advanced data analytics, interoperability and shared governance frameworks can also be powerful tools to counter it.
Beyond enforcement, the EU’s approach contributes to broader societal resilience. By reinforcing product safety standards, protecting consumers from unexpected costs, and safeguarding public revenues, the reform supports sustainable markets and trust in institutions. It also demonstrates how interdisciplinary thinking – bridging economics, security studies, law, technology and sustainability – can translate into concrete policy action.
Ultimately, the EU customs reform shows that addressing illicit trade in the digital age requires more than isolated interventions. It demands integrated responses that recognize how legal trade, illicit practices and technological infrastructures are deeply interconnected.
