In a change in their business model but also... Postal code, with long-term planning, the major Chinese e-commerce companies are proceeding, in an effort to limit the additional costs created by the new €3 tariff on imports of small parcels from third countries.
The new legislation applicable to EU countries from July 1, 2026 has already brought profits for the state coffers, since more than €2 million have been collected in Cyprus. from these imports from China.
However, companies such as Temu and Shein have already made two important changes, so that on the one hand they can manage it communicatively and on the other hand reduce the economic impact of the new legislation as much as possible.
In particular, they have adapted their systems and prices so that the duty is paid when the product is purchased and the citizen does not pay extra when receiving the item, and on the other hand they are building a longer-term model, with a greater presence within Europe, with local sellers and more stock located within the European Union, to avoid the high cost of 3 euros per item, when the European consumer receives the product directly from China.
We have such an example in Cyprus, after such a move by Temu in Cyprus. In September, the company announced a collaboration with the Cyprus Association of Information Technology Enterprises (CITEA), through which the platform seeks to connect the platform more closely with Cypriot businesses and to utilize Temu as a channel for access to European markets.
The partnership comes as a continuation of the Local Seller Program, which the company brought to Cyprus from 2025 and allows local businesses to sell through the platform to customers across Europe.
Taxes do not disappear
The new design with warehouses in Europe and local distributors does not mean that taxes and other burdens are eliminated. The difference lies in the way the products are introduced into the European market. It is one thing for a product worth a few euros to be shipped separately from China to a consumer in Cyprus and charged with the fixed fee of €3 and another for thousands of pieces to be massively imported into a container and cleared through customs in an EU country.
In the second case, the company still pays VAT, customs duties, shipping, warehousing, and distribution. However, the cost per piece is lower, particularly for products of very little value, for which a charge of €3 can be equal to or even greater than their purchase price itself.
From China to Europe
The logic is simple. Companies transport larger quantities of products to warehouses in Europe, import and clear customs normally in the EU, and then orders are fulfilled from European territory.
Thus, once VAT has been paid for a product, it can circulate in the EU and its shipment to Cyprus is not a new import from a third country and therefore there is no need to pay the specific duty of €3.
Of course, the benefit is not limited to the tariff alone. Transporting a container with thousands of products is cheaper per piece than transporting thousands of separate small packages from Asia to Europe, while reducing delivery times and facilitating returns.
However, this model also has a cost, since it requires warehouses, larger stocks and correct demand forecasting. But as the cost of direct small parcels from third countries increases, the stronger the incentive for platforms to become more "local" and to move more of their activity within Europe to continue supplying Europeans.
Essentially, now in order to save €3 on parcels, one will buy a product "made in China", but with a European address.
