Analysis: Consumer-Imports via Online Platforms: Consequences for trade and the internal market
Buying low-value products from online platforms has become widespread in the EU. However, inspections show that these products can be harmful to both health and the environment. This analysis examines why this problem arises and what the consequences could be for businesses, consumers and public authorities.
Shasa Aziz, you are one of the authors of the report. Why is it a problem that so many people shop on these platforms?
Because the vast majority of products do not meet EU requirements. Some products can be directly harmful. Examples include jewellery containing cadmium at levels thousands of times above the permitted limit, and USB chargers that catch fire during testing.
E-commerce often brings benefits to both consumers and businesses. However, when sellers outside the EU sell millions of products directly to consumers, those consumers become importers under certain regulations. Once defective or non-compliant products have entered the EU, the problem and the associated costs for the EU have already materialised, often with no EU-based company that can effectively be held accountable.
This shift in trade makes the checks that EU rules rely on less effective and more costly. As a result, non-compliant products can enter the EU market more easily, exposing consumers to greater risks. At the same time, businesses that follow the rules face competition from sellers who do not bear the same compliance costs.
How can these platforms break EU laws and rules on such a large scale?
The main reason is that EU rules are based on a way of trading that no longer reflects reality. The rules assume that there is an identifiable business or other economic operator within the EU that can be held responsible. When products are imported by consumers directly through online platforms, such an operator is often missing.
The problem is therefore not a lack of rules. It is that the rules and the systems for enforcing them were not designed for the scale, speed and business model of this type of trade.
The report argues that this problem needs to be addressed at EU level. Why?
There are several reasons. First, products that have cleared customs in one EU country can move freely throughout the single market. If individual member states introduce national fees or stricter checks, platforms can redirect their trade to countries with less stringent controls. Without coordination, we risk creating a patchwork of national rules that fragments the single market.
Another problem is that several national and EU authorities are currently responsible for overseeing the same platform, each with different mandates and access to information. This system cannot effectively deal with a problem that involves product safety, chemicals, consumer rights, data protection, intellectual property rights and customs at the same time. A more coordinated approach at EU level is needed.
What do you think EU policymakers should do?
EU policymakers could use both new legislation and revisions to existing rules to address the structural challenges that the high volume of direct sales from outside the EU poses for consumers, businesses and authorities. The new and revised rules should expand and clarify the responsibilities of the relevant actors for ensuring that products comply with EU legislation. They should also equip market surveillance authorities with adequate financial and operational resources and the legal powers needed to prevent unsafe or otherwise non-compliant products from reaching consumers and to take effective action against those already on the market.
Consumers must be able to trust that products made available to them in the EU meet all applicable requirements, including those on product safety, regardless of where the seller is based or how the products are purchased. Businesses that follow the rules should also be able to compete on fair terms, without being disadvantaged by sellers who avoid the costs of compliance.
What is the National Board of Trade Sweden?
The National Board of Trade is the Swedish government agency for international trade, the EU internal market and trade policy. Our mission is to facilitate free and open trade with transparent rules as well as free movement in the EU internal market. We provide the Swedish Government with independent analyses, reports and policy recommendations and take into account the views of businesses of all sizes in international trade policy-related matters.