EU Customs Reform 2026: Market Impact and Transition Management

impact and transition management. I'm grateful to the UPU International Bureau to host this second part. You will see today again that knowhow and technical expertise are readily available uh within the UPU consultative committee to advise and help posts implement solutions between tax and duty experts. We call them solution providers or even operators. We call them volume providers. The consultative committee members have all been aware of this change for more than a year now. Please use the check function for questions. uh those questions will be collected by the international bureau in the background and uh I will then have the opportunity uh to ask those questions to the presenters. Kindly note translation is available into Spanish and French and you can switch on that translation accordingly um um in the webinar service lines. And with that I would like to uh open the panel. Uh please to the panelists again uh my remark is uh please um stay within the time allocated to you. This is for our panelists 10 minutes. Um there will be a presentation by the customs group um following my short introductions and I would like to give the floor now to the customs group. Please. Floors is yours. >> Kristoff, I hope you're online. >> Yeah, all good. >> Kristoff Pereira. Yes, Kristoff. Very good to see you. Please, floor is yours. >> Thank you very much, Walter. Uh, ladies and gentlemen, dear colleagues, uh, good afternoon, good morning, good evening. So I would like to briefly introduce the recent work uh which has been carried out by the UPU customs group in relation with uh in relation to the AU customs reform. In particular, I will refer to the webinar jointly organized by the European Commission uh and UPU of course on June 2nd and summarize the key messages and the follow-up actions. So the AU customs reform uh will enter into force uh in two days on July 1st 2026. It introduced a temporary simplified customs duty of€3 per item mainly targeting B2C distance sales uh goods before below 150 euro. In terms of collection, uh most designated operators will prioritize iOSs flows with a DDP model while some will still handle nonioss items and collect duties from the address C. It is also important to note that certain items remain unaffected such as gift below 45 and also goods above €150 for which uh customs duties will be calculated with at Balorm method. Next slide please. Yeah. So on June 2nd, the customs group in collaboration with the European Commission organized a webinar on this reform, the event gathered around 280 participants, sorry, confirming the strong interest from the postal community and due to the time constraint, not all questions could be addressed and consolidated Q&A will be shared with the GD tax suit for follow-up. All materials including recordings, presentation and FAQ are available on the UP website and in parallel postrop also been actively engaged through dedicated FAQ sessions and share the documentation. Next slide please. So uh beyond the webinar now the customs group continues to work uh and on several key questions. This includes monitoring regulatory development particularly in the European Union but also in the US exploring operational solution and developing proposals for regulatory updates. So since the last meeting several expert team sessions have been held focusing notably on emerging requirements and in the implementation of the electronic advanced data. So the next customs group meeting will taking place uh on July 8. Next slide please. So to conclude, I would say that the AU custom uh the AU customs reform represent a major change for our sector. While important progress have been made, further clarification and coordination will be essential in the coming month. especially we have a deadline on October 2026 uh where the European Commission would like to review the current guidelines. So there is still a possibility to uh influence the legislative part of the AU customs reform. So I would therefore encourage continued dialogue between operators, regulator and stakeholders of course. Thank you very much Walter for your uh invitation and thank you very much for your attention. I remain available of course for any questions. Thank you Kristoff in particular also to uh keep to the um timeline. Uh of course um the consultative committee and its solution providers and volume providers um are available um um as observers uh to the customs group for any kind of questions and helps. And if there are questions in the background, the international bureau is already collecting those questions and I will uh bring them to your attention um in the course of this webinar. Thank you Kristoff. >> Thank you. >> And and with that I would like to move to the UPU technological uh perspective. Um I have the pleasure to welcome Lati Matata and also Davis EPSC um from the postal technology center. Uh, Latte, the floor is yours. Thank you. >> Thank you. Thank you very much, Walter. Just to make sure you can hear me well. >> Yes, we can hear you. Thank you. >> Excellent. Okay. So, uh, greetings to everybody in this webinar. Um, if you were in the first webinar earlier um last earlier this month, we are just giving you an update on the progress made uh with additional information. So, next slide, please. Next slide. Thank you. So, first of all, as always, a reminder on the overall technology strategy for this cycle. We like to put it in a single diagram where we try to capture all the actors, all the business processes. What we have added for your attention is uh who is using which particular technology uh that comes from the UPU. In particular, I draw your attention to uh the solution for customs processing. As of today, it is used by 179 postal operators. The network itself uh postnet for the transfer of data between all actors stands at 229. Additionally, we are pleased to have our wider postal sector players slowly adopting our solutions and platforms. From a career point of view, we have 35 and from a postal business partner point of view, we have seven of which I will give more uh information. Now, what you have in terms of the uh for your attention are the red dots. Uh these are all the changes and actors we are implementing to support uh the DDP solution. Next slide, please. So similar to the previous webinar, we like to present the customer journey and process. Now if you look at it as layers, at the top layer is the customer experience. How you interact with the post of origin. So that first uh layer in blue that's if you are an origin post, these are the activities you will do to provide a DDP service to your customer. The second layer or the third layer is the PTC IT tools, the technologies that have been adapted to support this service. And then the next layer is now what we call the third parties. Essentially um any commercial or non-commercial entity or personal operator that is helping us um implement the requirements for DDP in that jurisdiction destination jurisdiction. So in the case of the US we have spoken about that extensively and now we are adding on to this model the destinations for European Union and then finally at the bottom so it's it is marked US CB CBP which is our uh US customs uh and border protection uh authority. However, we are building a solution that would then support any customs authority of destination. Now what we are adding to this particular slide if you just click once is the necessary changes that we have to make to the solution to make it uh support first from the US point of view the incoming regulations that were just updated last week and further updates will come uh this week and in addition of course we are adapting it to support uh the EU do. Now the first point I would like to highlight here is we are trying to as much as possible reduce the impact on the sending post on the customer and of course on our on our destination posts. This is always our objective with the intention to build a truly global BGP solution. So if I start at the third layer uh which is the PTC technologies we will be adapting our solutions to capture all the requested additional elements. When we go to the fourth layer now the third party we have some specific requirements from the European customs code related to how to implement a DDP for the 27 EU destinations. So there's some work to do here. Additionally, sorry. Additionally, the European Union require requirements expects the destination UDO to be the one to pay the local customs um on the duties and taxes requested in advance and then to collect all those uh payments from the origin post. in terms of moving data to the third party. So currently we provide a manifest with some basic information additional data elements are now going to be transferred and then finally with regards specifically to the United States additional organizations will be involved in evaluating the the the risk or the review of the postal item based on the data provided. So I do understand we are focusing on the European Union mostly today. However, the US updated requirements are coming uh very uh quickly and in parallel. Next slide please. So as a reminder so this is a new slide. Uh we have I'd say uh now a mature product. We have been growing in terms of its flexibility. If I start first on uh the footprint, we as mentioned we do have 179 users of the solution. We do have the technology more and more widely deployed for especially from a customerf facing point of view. And if a postal operator does not have CDS, we provide central APIs. So the requirement to have CDS is not a must. We do provide an API. um gateway for you to access the necessary information to offer a DDP service. It is highly modular for the experience. Now different components of the solution have been used by different posts. So um we have a now onboarding process which allows you then to adapt um to your own specific uh origin post requirements and use the parts that make sense to you. I also want to point out that this solution is volume based. So there's no flat fee. It's purely volume based. And most importantly uh we are looking at the settlement aspect. The work to have to adapt the UPO clearing solution uh has started and we hope to have a working solution by the end of this year on service providers. So earlier this year we did highlight uh this month sorry we did highlight that we are making progress to certify um our providers for the DDP or the landed costs and various other lookups. Now I'm pleased to say we have seven as listed there and we are open to continuously onboard newer third party and commercial providers for the service. So you're welcome if you're interested to do this uh you're welcome to contact the PTC at the same time for our postal operators this means we bring for you choice. Finally on payments method in the previous slide we showed the three ways you can do this so I'll not repeat this but the most important point is we provide uh payments options depending on the customer profile. So we handle all cases. Next slide please. Now I think we are all aware that uh starting off with the US and uh I hope not with the EU there has been impacts in terms of volumes. So we thought we'd be good to uh to bring to your attention what we do see at the PTC. On the left is uh a graph which shows the weekly volumes uh starting um from the middle of uh the start of last year. Uh the line in red is what you should be paying attention to and the drop there you see was as a result of the implementation of the uh the US executive order. Um the good news is of course with the roll out of the DDP solution we are slowly recovering or we're seeing a slow recovery in volumes. Now it's important to also say that this uh statistics you're seeing here are only related to the postal operators who are using the UPO DDP solution. So as of this moment 51 postal operators so it's not the entire network which brings me to the right as just a snapshot of our dashboard showing uh what is happening on the network. We have three qualified parties now who are providing this service and we hope again to add more and more um providers. Uh 51 postal operators are using our solution and we see about uh 21,000 declarations on a daily basis. We always do uh remind you that we have a dedicated page for this uh activity. We try to keep it update updated. um we will be updating it now with the implementation for the EU as we go forward. So I just want to remind you that this is a centralized point from the PTC's perspective where we keep you up to date. Next slide please. So this is my last slide uh for our WPS uh who are in the call our CC members. First of all, this is all for your advantage by getting certified by the PTC against its uh UPU technology. Most importantly, you get access to the entire network. It's not just to one particular postal operator. You get a certificate uh signed by yours truly. You will also be listed on the UPU website under the second link where we will highlight a contact point, a description of your service. So we invite you to contact the PTC to continue on this certification journey and we'll be happy to answer any questions you may have for postal operators. Uh the whole objective is that first point we want to make sure that uh first of all the trust of these service providers is strengthened. The interconnection or the interoperability with our technology is secure and stable. And then finally uh from a postal operator perspective we give you choice. You will have a competitive landscape of operators from whom you can choose and change based on your discussions and negotiations with these service providers. So with that I will stop and I'll be happy to take any questions as part of the Q&A. David and I. Thank you. >> Thank you Latte. Message well delivered. Thank you very much indeed. Um without any further ado, I would like to move to the short presentations of our consultative committee members um on the on their um particular market perspectives. First one um will be boxy um J Scoffield the co-founder and chief digital officer of Boxy. Um sir, the floor is yours. Welcome. Please unmute yourself. Thank you. Thank >> Thank you. Um yeah, I'm ready to start. You can put the next first slide up. Uh Box C just introduced we're one of the certified EPU providers. Um we you know been providing this service through to the US. So, it's been working um pretty smoothly now and now we're preparing for the new changes. And this is about the um uh EU, the changes that we're preparing for for the EU. Um you know our systems built to make it easy you know take care of a lot of the comp complicated complex issues and uh design you know uh the paying the three collecting the three euro duty uh making sure the uh line that they're applied to line items and uh and also managing the uh payments. Uh we can go to the next slide. So Box C what we do is we're just an orchestration layer is the best way to look at it. Um we work with multiple uh parties all around the world. Uh multiple brokers around the world. U u all those you know everything that's needed for to cross a border for e-commerce shipping. Um, as I say, we're vendor neutral, so we have multiple different uh providers. Uh, you could connect to any of those you'd like to use or u, you know, we have ones that are set up. Um, we can always, you know, we're always changing, always keeping, you know, uh, integrated with different, uh, um, um, pro customs authorities if need to be. um uh the P different uh designated operators um even on the commercial side as well and we're constantly integrating with everything that needs to be uh integrated with. So whenever things change um it's just a matter of using our service rather than having to integrate on your um uh next slide. So with uh the um changes coming to the EU, which is just only a few days away, we've you know prepared for that. Um we're always managing, you know, all the data that comes through and making sure that data is needed to um um you know, clear customs and to um make sure there's no problems or things get held or that sort of thing. Um, again, you know, I think the big thing is a $33 um customs duty that's based on the um um each line item. So, if there's two items that are the same, uh it's just only €3 rather than each being €3. So we automatically filter that and make sure those things are done um as when they're when the data is coming through. Um also we're preparing for the product identifier and you know all the rules that are coming through because this is actually you know more of a acceleration of what was planned in 2028. So these we've always been planning for this. So this is you know the um um all these things are being planned as we move forward. So this will also you know kind of what we do is make sure you know that's all in place um so it's a smooth move over to that. Um we can also help with you know how to deal with those PIDs and everything those sorts of things. We do that already in the US for uh what they call the PGA or or partner governmental agencies um you know deal with those sorts of numbers and the supplier number or manufacturer ID. So this is something that's kind of the technolog is already there and ready to um use for the EU as well. Um we can go to the next slide. uh this is you know how we you know we're working we're collecting all this data and and and in partnership with PTC especially with the UPU uh they send us all the data that's needed um you so we work very closely with them so it's always you know uh it's been working very well for the US um and you know how we look at it for the U will be very very similar is they will pass on that information to us and we can uh send that to the parties at the u the destination. Um how our system is now there really won't be any needed changes from a any of our clients or anyone using our system. The PD the DDP workflow will work the very same as it does for the US. It will just be for the EU. There'll be different uh data elements required and and uh and and the payments s process will be a little bit different but generally speaking from a user's point of view they will just still send the data the data will come through and we'll take care of those processes. Um we will also you know when we get that data you know as well as we're working on for commercial uh e-commerce clearances as well. So a lot of times we're already set up to do the um basically the automated the data mapping of what how things should be clearing in postal and and clearance in and EU countries. So any changes that comes up or things that happen we're prepared for. You know we can bring a lot of um processes that is kind of in the commercial side onto the postal side when needed when required. So um we'll make that transaction see transition easy and when that um uh any changes that come up such as the PIDs and things like that it's prepared for um we'll also do a lot of validate pre-clance validation so we'll we can check again this is kind of from the commercial side of things but this is something that we can also offer you know as needed on the postal clearances is um uh validating a lot of this information from the uh sender. Um, you know, we do have, you know, you can use apps, uh, where a lot of this information is is collected early on and, you know, it can make sure that the the sender is putting in the right information before it even gets started and then um um restricting anything maybe prohibited or uh things like or restricted or needs more information that sort of descriptions and things like that. Uh this also kind of relates a bit to the US as well. Um those that is changing uh um as we move along um as those changes are coming on along as well. Uh next slide. Um here we you know we manage the uh collection we can manage the collection of and payment of the duties to the to the uh customs authorities uh around the EU. Um again we can do the collection directly from the uh sender um and or just the um um provide the designated operator what the duties will be and what needs to be collected and then bill and then we will pay the um um customs duties for the destination country as well. um on the we also monitor a lot of these things. Make sure everything's paid. Make sure the bond any if any uh customs brokers are required in in uh in in in any of these countries. Uh you know each country is a little bit different. I I think cuz um you know you can see I think in some of the earlier slides uh each country has different ways they're handling it um the uh whether some are the declarant or the representative uh we will take care of all those things in countries where um the designate operator will handle you know be the representative or handle those sorts of things we can adapt to that or in countries where there's um um um there needs to be a representative or or a declarant we can take we'll manage that as well and then I think in some of these things and that comes with the filtering or the uh part of our system is you know it will there's any operators that will not do DDP we can also catch that early on as well um can also do the calculations as far as making sure everything is is um manage right as far as uh if some of the senators already have their own ISS number uh we manage that as that or if there needs to be an ISS you know representative for some customers um all the different ways that can be done we already handle that and are prepared to handle that for any things that comes up through here and as far as pricing, we're just very straightforward and and transparent. So, it's just a per fee and and um and that's that's all there is to it. Uh next slide and that's the end here. Uh Tonnie is uh I think many of you probably are familiar with her so or know her. So always reach out to her and and with any questions and I can answer any questions as well because we work together. >> Thank you very much indeed. Uh message very well delivered. Everybody knows Tony uh she is the vice chair of the consultative committee very well known always present uh in burn. Thank you very much indeed. Um the IB collects the questions in in the background already. So um under agenda item four five we will we will address those questions accordingly. Um I would like to move uh to the next presenter um which is uh Roses lovehati um of as project. I know I'm trying hard. Yeah. Um rosters love very good to have you here uh on board. Uh the floor is yours. Thank you. >> Yeah. Good. Uh good afternoon everyone and thank you for having me here Walter. It's uh it's interesting times and everyone is very much uh looking forward to the 1 of July to to to see what happens. Um can we have our presentation on then? Yeah. Okay. Can we go to the next uh um sorry my throat is a little bit sore today. So uh just a few words about ES. We are the leading provider of the automation for e-commerce. Our main business is IOSS and uh basically what I'm going to be talking today about is IOSS and the three Euro duty how it will work in the new um setup which is going to unfold um in a few days and some of the issues which are still open and they might affect both the postal operators and uh non-postal logistics service providers who operate on the parcel market. Can we go to the next slide please? So general rules again we a lot of things have been said about the three duty. I will not go very deep in there. So of course it is only applicable to the u distance sale of goods goods imported from third countries. So technically B2C I will come back to that a little bit later as well. So it's u applicable to the sales below 150. So it's basically the area where ISS uh used to be and still is applicable. So um the big difference for everyone is that the U duties pay is payable at the national customs unlike it was initially introduced within the IOS scheme when the VAT was collected by the intermediaries like us and uh paid directly to the um u EU member states. So now we have a new segment of collection and that's national customs. Uh we tried to talk to tax that this um uh function would be still transferred to to the EU to to ISS intermediaries but the decision was very much set on uh transferring this um to the national customs. So it's how it's going to be. So um and the one final thing which is very important for our discussion today is the role of the IOS uh number holder at customs or presumed role as it is explained into the uh the the explanatory notes which were provided by tax. Can we please go to the next slide? So what we expected when uh the whole thing was unfolded in uh February. So initial expectations were very grim. We expected that there will be a lot of um dropouts from the IoSS scheme and that the uh commercial activity will take over without the use of the ISS. Well, of course, our expectations were based on uh lack of uh um legislation which is in abundance nowadays and then uh we had to presume a lot of things but uh from our perspective now we can see that iOS registrations are actually rising and very quickly. So we have twice as many registrations this month uh this month uh compared to the the uh previous month. So it actually shows that the uh IOSS scheme still stays on and it will still play the active role in the uh parcel business. So um a few words about the commercial carriers. Uh so we are in contact with many. So of course everyone gets um prepared. So uh they will provide solutions for free euro uh collection and payment with lended costs. Almost every uh commercial carrier we've spoke we've spoken to so far they are uh offering these services. Now some of the offers will be very um inexpensive. So that will create a new market situation for everyone who is uh uh in this business. So um when it comes to the postal operators of course uh well PDDP probably will be the most reliable solution for the um delivery of low value consignments in the postal world. But um it actually has quite a few setbacks which are from the perspective of our customers might um change their mind from using postal world. I will come back to that later preparedness. So since our customers are mostly e-commerce operators so we are basically integrated to their stores. So we know what happens in the store and we are in the pro. So, so we apply our landed cost very often and we know how the process of calculation and collection happens. Uh, I can tell you that um most of the e-commerce platforms have not prepared properly for the change. Uh, some of them are taking the last minute steps. For example, Shopify published um information on the three euro just two days ago. So technically Shopify will be providing the calculations. We don't know if the calculations will be correct or not. Uh but we hope it will um it will work somewhat. So postal operators I don't want to stop here on this um uh particular uh point because it has already been presented. um and as I said commercial um solutions um they will be competing with postal operators very much and then specifically on the level of um non-supported countries again I will come a little bit later on the reasoning for that so um in in in in my understanding that the um IOSS is is is here to stay whether three euro duty or not and the um we will still deal see the the the whole situation unfolding in in the next month and we expect that the uh from the 1st of July it will not be a very um clear and uh precise picture of what is happening. We are preparing to support our customers as much as we can but there will be a lot of aspects where there will be misunderstandings and uh probably a lot of delays in the deliveries to the European Union. So can we go to the next one please? So the main challenges so um as we see it because again our perspective is from the uh um IOSS intermediary so it might be a little bit um off key for solution providers and for volume providers but still probably is very interesting for you to hear. First three euro duty in segmented supply chain. What we call a segmented supply chain is when the basically the merchant as our customer normally uh does does not support the whole or control the the the supply chain. So in the process of postal delivery there is originating postal operator there is the destination postal operator and then the data money and um a responsibility is transferred in between them that creates essentially a problem because if you compare the situation to the Chinese marketplaces they usually control the supply chain. So technically they actually know where every single parcel will come through customs in the European Union. That makes the situation formemes in the UK in the US much less um clear and uh probably they would be very much affected negatively of the whole by by the whole change. Second thing it's the place of collection. This is um this is a problem which was uh basically fixed. The date is wrong here on the 16th of June. So just a few days ago. The problem is that we as iOSs intermediary were responsible for VAT. VAT is to be collected at the play of at the moment of the sale. But technically uh 3 u uh 3 duty is collectible at a later stage and in a different place and even uh at the moment of the sale we cannot be sure if it's going to be 3 or€6 or 9. We don't know that we can presume but we don't know. So technically there was a problem since the U VAT since the duty is part of the VAT base for the customs purposes. So um the question was whether we have to collect somehow the U VAT on three euro and so we asked our uh DJ tax to clarify this on many many occasions and finally on the 16th of June amendments were published to the VAT commerce notes which clarified the situation very much in favor of IUSS. So uh the situation goes now like that. This is very important specifically uh since everyone is building their own landed cost calculation. So VAT for iOSs items is not collectible on the 3 duty while it is still collectible on the situation with special arrangement or normal um imports. So technically if an item goes as IOSS uh it will be less expensive by approximately uh well the duty so to say will be less expensive by 20%. This is the new development that will probably uh give uh additional incentive to the USS uh um registrations. Uh but one important note here is that this um um solution was published as an amendment to the uh VAT e-commerce note. So it's not technically legal document. So you has not been able to implement this legally entirely legally. Of course it will be it is still a document published by the European Commission. it will be used but that creates a lot of questions technical questions on whether it will be fully accepted by the uh customs and by the uh local tax authorities. So it needs to be still u seen. Um so and final question that might be uh interesting here to discuss is the VAT on the future to handling fee which is probably will be introduced in November. Um the current decision is there will be no VAT on the two handling fees. So it will be considered as a service provided by customs. Uh and then it's not uh subject to the VAT. So that's um something that needs to be known especially for those who actually create their own landed cost calculations. So let's go to the next one. So this is the one of the most interesting um things which is happening. The question is whether the free trade agreements will be applicable for the uh B2C um deliveries. So unfortunately this is the old version of the presentation. I hope that the new one will be sent to you. But um again the um situation goes uh as such that um the available legislation including the um customs guidance the the amendments to to to delegated act the amendments to the implementing act treat agreements in terms of application towards the the the the B2C uh low value consignment differently. Uh my opinion is that it is applicable. I mean the free trade agreements uh can be applied provided that H1 uh custom declaration is used and that the um uh proper HS codes are included with the uh the supplementary documents for the uh origin of the goods. Again, this is something that remains to be seen. Um, we will probably see um further deliberations of these cases uh in in in in the uh European Court of Justice because um well, you can actually check it yourself. I piled up this uh table specifically for the participants to have a look and make their their own mind on that. But this is something that um makes it very uh strange in the way how the the whole legislation was built. It was built hastily it seems and without due consideration to detail. Uh let's go to the next slide. So and uh it's probably the final one for me. So um for postal operators um as I said uh we believe that IOSS will be one of the essential components for the postal operators to handle the uh the DB type of a solution. Uh not only because ISS makes it less expensive to the end customer but also because the VAT is not to be collected at the um customs if ISS is used. that rule still stays. Um, so VIP as we heard still will be probably used by some of the postal operators. This is also for for for some destination and this is what I see from uh my communication with postal operators and we expect that the situation will progressively change over time. Um and again in the long run we still are uh waiting for the final implementation of VA rules and then uh as we expect in 2028 the rules will change again and then uh the uh duties however they will be applied they will be collected through the IUS intermediaries. Well next one please. So that is it. >> Thank you, Ros. Um very interesting uh market insights. Um I'm very happy that we are recording um this webinar to the benefit of all our participants and we will share that um after the webinar. But uh we are a little bit pressed uh for time. So I'm moving straight um to hurac. Thank you Ross's love. Um hurac Martin Palmer, co-founder um of hurricane. Uh Martin, the floor is yours, please. Thank you. >> Should a couple of minutes here, Walter, all being well. Um, good afternoon. I'm Martin Palmer from Huracan and a proud member of the consultative committee. I'd like to talk about the EU product identifier or PID and what it means in practical terms for postal operators in the wider parcel ecosystem. This is an important topic because PEG sits within the EU low value import reform for consignments up to 150 euros mainly in BTOC distant sales flows but has had far less coverage than below uh value threshold removal and has the same dates of implementation. In simple terms, the aim is to improve item level traceability and give customs authority better product data for risk analysis. What Hurricane does. Uh before we actually get into PID, let me uh briefly explain where Hurricane fits in. Hurricane Commerce turns commercial product data into customs ready data by classifying goods, calculating landing cost, screening for compliance and automating the customs data that moves with every parcel. In other words, we work at the uh point where product data compliance and operational execution all come together. This is an important topic because that makes pit particularly relevant because this is fundamentally a data quality and data organizational challenge and not just a customs formality as such. Next slide please. At a high level, PID is not one brand new code issued by an authority. In practice, it is a bundle of identifiers that already exist in commercial product data. If you can go back to the previous slide, I'll let you know when to change, please. Typically, that means the merchants product code, the manufacturer's part or model number, and where available a standardized identifier such as a G10, EN, UPC or ISBN number. The challenge is not registration. It is capture structure and consistent transmission pins are not required for B2B VAT registered recipient recipients or shipments with an intrinsic value of €150 or above just to make things a little bit uh more complicated for us all. Next slide please. In the EU reform context, PID is a set of item level identifiers used for low value imports into the EU. It has three parts. the MPID which is the merchant uh product identifier usually the seller skew nit the non-standardized identifier usually the manufacturers's part uh part or model number and the SPID the standardized identifier such as G10 ISBN uh numbers where one exists next slide please the reason the EU has introduced PI is straightforward Customs authorities want a more stable way to link declared items to actual products so they can improve compliance, safety, and forward screening. This matters even more now that the low value environment is becoming more controlled and more datadriven. The wider implication is that marketplaces, hosts and carriers will need far stronger catalog governance, better info detail and tighter data transfer disciplines. Next slide, please. In practice, a PID is built from existing commercial master data. The merchants uh skew becomes the M PID. The manufacturer's part or model number becomes the NS PID and any recognized standard codes become the S PIP. So the important message here is you do not need to apply for a PID from an authority. You can build it from data you already hold and make sure it flows into the customs declaration process. Um obviously a lot of the people that are are on the call today are transporters one way or another of of these commodities. So it's our customers uh as such will need to provide this information for us to to transport. Next slide please. PI is not is also not a single EUwide number format. the standardized element. So the ISBN codes for example uh the SPID is the most structured because it can be an existing format as an ECN, ISBN or a similar code. By contrast, the merchant and manufacturer identifiers are often free form alpha numeric values and used in commercial um backend uh systems. The operational focus should be less on inventing a format and more on the importance of data capture, validation and consistency. Next slide please. PIN is not filed through a separate portal there. There isn't a new channel or a new stream as such to transport this data. It is captured in the sellers or platform cataloges and shipping workflows and then passed through invoice data or API connections into carrier and postal messages. Um companies, sellers, uh uh manufacturers etc are being asked to show this information on the uh commercial invoice for example and any other supporting document. From there, it will support pre-arrival filing and load value customs declarations processes. For posting carriers, the real question is not where to file the PID, but how to ensure that the right item level data moves cleanly through existing electronic flows. Now, I guess an important point to make here is whereas what we're talking about with the uh 3 fee being at a HS level, um obviously five t-shirts, for example, could all have different skew numbers. So each one of those t-shirts would then require their their their own uh P ID even though it may be the same HS code. If it's a different skew number then it is a different PIN as such. Can we go to the next slide please? The times are tight um but very clear. Um a voluntary system starts on the 1st of July, so on Wednesday. Um alongside the EU removal of the low value customs exemption and operators are already being encouraged to have their PIDs um data flowing so systems and data quality can be stabilized. Um it it has been so poorly communicated this whole process that I I would be very surprised to see too many companies um already being in the place that they've got this data uh available to flow through the system and then from November so only really about four months PI enforcement begins for inscope low value shipments into the EU. The transitional window is short and obviously the time to prepare is three months ago but um obviously we're we're talking about it now as such. So if we move on to the next slide please what should operators do now? First update sender portals and APIs to capture the skew model or part number and the standardized code where available. Second, map that data through invoices, messaging and declaration outputs with field level validation and exception handling. Third, train operational and customer service teams, run pilot traffic with selected merchants, and monitor fill rates and error rates. At an executive level, this should be treated as data um as part of a data governance program and not just a change requirement for for for customers. Um I I I think it's also important to just mention here that um the the the standardized references for example, they won't be available for for anything uh everything. But if it's a book then you may have a skew, you may have a model or part reference number and you may have an ISBN number in the case of books. All three pieces of information will be required. Next slide please. So just to close PI PID is not about entering uh inventing a new identifier. It's about making existing product identifiers usable, reliable, and transferable across crossber data chains. For personal operators, the organizations that do best here will be the ones that treat product data as strategic operational asset, not just back back office uh details. Thank you very much, >> Martin. Thank you very much indeed. Uh thank you, Harry Kane. Um from our perspective uh the consultative committee this again was a very good example of how um consultative committee members share knowhow to the benefit of designated operators. Thank you Martin for that. And with that I would like to move um to um our colleagues from the international post corporation. Chris the floor is yours. Thank you. >> Hey Walter, thank you so much. And I just start with a sound check. You can hear me. Okay, I guess. >> Perfectly. Thank you. >> Awesome. Well, first of all, thanks uh so much to the UPU for putting on this webinar and a specific thanks to you and to the consultative committee for allowing IPC to join. Uh you can go on to the next slide if you want. uh International Post Corporation. Of course, our mission and goal in life is to support postal operators in growth in crossborder e-commerce and to provide solutions that help them uh get through the things like the storm of the UCCC in order to continue to grow. You can go to the next slide. I'll try to get some time back for you. But I I think for those of you who may not be aware of uh who IPC is, we're for the posts and by the posts. Uh 35 years in business in terms of leading uh the growth of solutions for the postal sector where shareholders are the post themselves. So we're a postal collaborative that's not forprofit. um 24 different designated operators are the essential owners of IPC and guide us and help us along the way. We have more than 50 services that are used by the posts. Many those have to do with customs duty and tax and then we connect those services into more than 200 different posts and carriers around the world. So quite good reach and and just as it's always helpful to say upfront if you ever want to get in touch with IPC we're open to any post of any size around the globe who would want to connect to one of our services. You can go to the next slide. I I think you know one of our goals is to try to stay ahead of the curve. I liked what Martin said about you know having to have this discussion three months ago. It's completely true. Um, we've been trying in our technology buildout specific to e-commerce to anticipate market trends and try to work through the different regulatory impacts. Our our PDDP, so our postal delivered duties paid product that I'll talk about today. It's actually going on its sixth or seventh year in the market, far longer than I've been at IPC. And I do think it's important to state upfront one of the things about delivery duties paid before it became a regulatory imperative uh it's been a customer imperative and it is shown to be quite a loyalty driver in the market. You know customers tell us time and time again that what they really value is clarity to total landed cost when they're making a purchase. So when I buy my shoes I I live in Belgium. When I buy my shoes from the US or from the UK, I want to know exactly how much it's going to cost to get those shoes to my door. And I usually don't want any kind of surprises that that can ruin my day at the doorstep. And that's how you really do kill customer loyalty. Um that comes across time and time again in the IPC research. So we do our crossborder shopper survey. Um we're nine in 10. So 90% of respondents and this is the number one driver in terms of importance when buying cross border tell us clear information around delivery charges before placing an order is is important. So number one factor the second factor no doubt is uh low customs duties. So almost the same amount 84% tell us low customs duties are a big driver uh in terms of crossber. So I think no more pertinent discussion than uh the one we're having today. You can go to the next slide. And to solve challenges for the customers and for the postal operators that we serve, we've launched our postal delivered duties paid product. It's an intoin solution for duty and tax collection for the postal world. Uh which includes both tracking and reconciliation and reporting technologies to make life easier on the posts. You can go to the next slide. This is a slide that I I simply can't update fast enough because of the the growth that we've seen in terms of our PDDP usage coming off the back of the US uh dimminimus removal in in August of 2025. Um I think as of this morning we're now up to 44 posts who are on the PDDP solution with more than half of those using our our US application. Uh 11 million shipments at the time when I made the slide. I'm sure this is 12 or 13 million by this time, but you know 12 or 13 million shipments into the United States post dimminimus. That was one of the big wins to helping the post win back and win more on that lane. Uh and then I think posts have already started, you know, from as early as February to have discussions with us around the UCCC changes that were coming up. uh many of the more proactive ones have already started to implement the technologies to be able to support uh as as Martin said the data capture and the different elements that are coming uh on Wednesday morning. We we've already seen a 200% increase for example in terms of the non USPDP numbers. So quite a robust system and if you go to the next slide I'll kind of walk you through how it works. So I I can tell you really 50,000 foot view uh around the journey of a PDDP shipment. Uh one slide back, I'm sorry. A and very simple. You can you can think of this as uh me again buying my shoes in Belgium from a United States website. Uh the e buyer is going to make a crossber purchase. So duties, taxes, fees can all be collected by the merchant. Uh that way the the funds are remitted up front. the e-eller. So that that guy who's shipping the package to me, he's going to create a PDDP shipment using one of the the designated operators outbound products. Uh so it could be let's say postal PDDP the sending post or even a third party today as we now have allowed technology partners to join the party in PDDP. He's going to upload transactional data to our PDDP server and open a PDP record that that's now visible across the globe to the PDDP postal operators who participate. So they can see that there's a PDDP shipment in the network. The destination post will recognize that there's an incoming PDP. He knows that the duties and taxes have essentially been agreed to be prepaid. Shipment is customs cleared. Doesn't have to have any, you know, notification to recipient to collect money. It's much smoother, much faster through customs. Destination post will then update the actual duty and taxes paid uh to be able to then invoice the sending post. And at the point where they invoice the sending post, that's when the transaction is closed. The sending post will pay the destination post outside of the PDP uh mechanism. So very simple for post to implement. You can go to the next slide. Specific to the UCCC changes that are coming on Wednesday, we've beefed up our PDP technology so that we're ready to support volume in uh many of the markets in Europe in 2026 and beyond because I think as we've learned today, it does not stop on Wednesday or July 1st. The changes will be continuous. We've developed a new transactional API, so a V2 API for PDDP and all of that documentation if you're interested to join is fully available. That includes capture for the extended data set, the PIDs, uh, that Martin had referenced in his presentation as well as this new concept of a third-party declarant. So, we can capture and input their Eori so that the posts have access to all of that information. And then of course that's all backed up by our PDDP framework agreement in the government governance. So we ascribe liability. Uh we handle power of attorney support. Uh we do a lot of different kind of agenda that help the post manage the ins and outs of PDP. I won't go into the uh ins and outs of the technology map. That's not my my forte. But I will say that we're also working closely with David and Latia and the UPUP PTC team on looking at how we might launch interoperable solutions between the UPU and IPC's PDDP product. I'm sure we'll get there in a future webinar. You can go to the next slide. There we go. Multiple ways to connect into IPC's PDDP product. Um, just so you guys know, it's not a one-sizefits-all shop. We also like to give our postal operators uh choices. I won't go through all of the detail on this slide, but essentially you've got three paths today. Um, the first is the IPC PDP standard approach. So there you would sign a framework agreement and a DX session. They all use the same transactional API. They all use the same PDDP reporting. Um, you can also go via Prime if you're a member of the Prime network. We have a special alliance with the Prime network. So, you can access PDP via that alliance. That's a different uh memorandum that you'd need to sign, but again, most of the things on the back end are the same. And then as of Friday, so you can change the uh the coming soon to recently launched. Uh we've added a third-party technology provider program. So some of the larger thirdparty technology providers in the market like Azonos can now create PDPs on behalf of an outbound post. In that case, you'd contract with them and they handle a lot of the development work. So different uh means and methodologies for differentiz posts who want to connect to IPC uh because it's not a one-sizefits-all solution. You can go to the next slide. Just check my time here. uh if you want to get up and running and I I'll cover this one very quickly. I mean the most important thing I if you want to be ready to go is to clearly communicate the desire to IPC you can contact me directly if you like. There are a couple of light NDAs to sign before we can share kind of the detailed more technical information. Um after that we would connect you into our API gateway so that you can begin development. We always get asked how long does it take to code PDDP? If I'm a postal operator, I can tell you our world record is two weeks for a very motivated post or in the US changes. It usually varies between a couple weeks and a few months. Um you'd align with our import partners and then we'll help you out on on go to launch. And I think that the last slide and I'll close it there is just the uh core contact information and if you want to find out more you can write us uh via our help desk or again contact me directly and I think Walter it's back to you. >> Thank you. Thank you Chris. Um and again um very good for all the participants in the webinar. There is choice there are solutions there are um companies and providers ready to go. Um, and I'm I'm very eager to hand over as fast as possible to Kristoff. Kristoff from Easy Tech. Um, the floor is yours, please. >> Thank you very much, uh, Walter. Thank you very much. And and thank you for all the UPU team to give us the opportunity to to speak uh today. Uh, we are very very glad to to take the the the word. Now um let's go to the the next slide. So today we will speak about address validation because like it has been said previously by my uh colleague and partner um uh with the address it's the different change here concern mostly B2C there is a real B2C um uh engagement here and then we saying B2C means that uh uh you can have some address uh problem because um everything will be uh will be managed by the the person that will order online. So this is the the subject of today the custom bottleneck uh from our perspectives and the tax it's really the address and we are here to speak about address relability validation for minimal cost and we can go to the next session. Who are we to speak about this? So easy techch international we are we are specialist in the sorting and track and trace. For the sorting we are working with some private and public post uh with the sorting machine for the mail and also the parcels. And we also have an entity for track and trace and locker connected locker uh to automatize the last mile delivery. We are also specialist so in cutting cutting edge innovation to optimize uh through uh AI and software the different logistic flow and we can go to the next slide. So the problem that we we will speak about today is with Kristoff. Uh here it is and Christoff I let you the mic for explaining the the numbers. >> Yes. Thanks. In order to clarify the the problem we want to share two figures. The first one is five 5% of the B2C delivery addresses don't exist on official catastro plans or worldwide database again but uh you know it just keep in mind that the we talk only about the B2C market and that's very very important on this market that the end user who write uh his own uh postal address with potential human errors and it explains the second figures 25 25% of poorly draft address generate geocoding errors that impact deliveries. So an valid address impacts custom declarations and delivery fails as well. >> Uh Eddie let you explain the consequence. >> Yeah, exactly. We identify four consequences and the first one is the loss of margin because in fact no matter where the parcel is ahead if it can be delivered it's still cost to you the terminal dues custom fees everything that has been explained by uh all my friend before. So for a parcel that never reach out its destination it's it's quite expensive. So it's brutal loss of margin. Second one is the loss of confidence because when a parcel fails to be delivered the shipper has paid for logistics and custom fees uh and all this for nothing and uh generally the first reaction is to blame the carrier never himself. On the top of that uh legally uh an undelivered parcel means a full refund to the end customer. Someone has to absorb that lost and it's rarely the shipper. Mhm. >> In third position, uh it concerned the branding. A consequence on the branding. When the delivery fails, the recipient never blame himself for the wrong address. He blames the e- merchant every single time. And then the number back this up, it's 70% of purchase decision are directly influenced by logistics. That's why today we we try to make a focus on the address because it's very important. There is a studies from the fever at the French Distance selling federation confirms it. Trust in the delivery chain is a make or break factor for online sales. One bad deliver one bad delivery experience. It's one lost customer and possibly forever. We all uh like when the when everything is going smooth with our parcel that we are waiting and uh for you post the your competitors don't necessarily handle bad addresses better than you do. That's a very important important thing. But they invest he in the recovery. They call the recipient. They send messages on application. They even ring at the neighbors. Whatever it takes to find the recipient and the and complete the delivery at any cost and the perspect perspect. This concern uh has actually reached uh the highest level of uh of our industry because uh just as a reminder in the at the 28th UPU World Postal Congress in Dubai uh my colleague Gora was there and the erosion of national post share in the parcel delivery market was formally acknowledged. It's a ch shared challenge and addressing it starts with the quality of the data uh that you are entering in your network. And that's why we want uh we we wanted uh today to present you something about this because my conclusion of this of this slide is that you didn't create the problem but you're paying for it anyway. Uh whether it's your fault or not, when a shipper submits a bad address, you're you're the one paying the price. These addresses are never validated upstream before they even enter in the network. And yet you national post are the one left holding the consequences. So you didn't create the problem. You are paying for it anyway. And we can go to the next slide. Um very quick uh why uh we are speaking about all of this today? Because uh easy techch international uh has made a partnership with certain group to uh uh put in place uh AI based solution directly integrated in CDS that allow all the post to validate and correct the address uh the the address and we will present you this in a few minutes. Let's go to the next slide. uh very very quick why uh me uh and Kristoff are here today to introduce this because uh from my part I'm working from 10 years uh in a software logistic project for mail and and parcel optimization um and my colleague uh up Kristoff you can introduce yourself >> yes quickly as well I'm the CEO for short group solution I support partner on our solution it could be setup it could be dayto-day use more uh thanks to my professional experience I was purchase director for fak and care for doing around 25 years I also know very well the B2C transfer but yes let's move forward to on the solution so uh the aim of the solution we are introducing today is to enable address validation directly on the UPUCDS platform like I said it's AI based solution it works on for the addresses of 200 140 countries with 99% of validation quality and 200 API requests per second. So very powerful um API. It's a UPU certified. We will explain this later but you can find this directly. The aim is to solve all the address problem because now with the with all the change that uh that my friend explained before uh the the cost for every uh bad address will will be absolutely skyrocketing and we can go to the next slide. So uh just a quick screenshot to show you where you can find this new tab on on CDS app. It's directly on the CDS. You have a tab naming address validation provider when you can directly uh copy past a token that will allow you to access this uh service and we can go to the next slide. Maybe Christoff it's your turn here. No, >> no, it's yours. It's yours. You can move forward. >> Perfect. Thank you. So while the other stop at uh verifying the structure and the other stop at verifying the existence of the country, the city and the street. Um we with the our address address validation solution we verifying the structure but we also validate the address against the government records and if the address is invalid we provide the reason for the rejection. This is another strong point about the branding and your brand image. Uh because that means that you can provide the specific reason of the rejection and by saying that you can upgrade your quality service by bringing the proper justification to your customer and we can go to the next slide. So to to summarize, thanks to to this option in your um CDS platform, you will fix problem described in the beginning of of this presentation. Yes, you will improve a customer satisfaction. You will transfer responsibility to shippers. You will handle less after services. You will optimize your your margin. Uh and also you are going to to earn market share. uh but I would like to focus on uh the two last advantage uh the first one uh but we can't next slide perhaps because I we can't show yes >> perfect so for the the last two advantage first zero investment there is no development cost at the solution as it is an option already integrated into the cedus platform and uh the valid address for free. Uh you have to understand that unlike our competitors only invalid addresses are invoices. If you submit um one 10,000 addresses and only 50 are invalid, you will only pay for the the 50 unvalid ones. And that's very important, I think. Next slide. Yes, we have it. So uh uh just back you could go back. So to to summarize you have just to to send an email to to us you will reserve the token and immediately your IT team will be able to activate the service into the into the CDS platform that as simple as it is. So thanks for for your attention. Thank you very much indeed. Um Kristoff and Hedi um again um a different angle, different um consultative committee member very much focused on one of the major aspects on quality of service that is addressing with a UPU certified certified by the PTC um application um to the benefit of designated operators. Um obviously very powerful. Thank you very much indeed uh for that. Um we have still 7 minutes to go and um I'm uh looking for the support now of my um consultative committee um secretariat for the questions and answers. Um unfortunately we had a little technical problem in in the background. Um I know that uh the customs group and also the PTC have been answering uh a lot of questions already um in the background but um I'm waiting now for the support um of the um consultative committee in the background um for for questions for Mr. Palmer um regarding uh um pre-arrival filing. Uh what about uh the recipient's address? Uh do you verify um the delivery? Um is that already enshrined uh also in uh the product of uh of hurricane? Please. Uh a short a short uh answer to that question. >> If I understand that correct, Walter, are we talking about address validation? >> Yes, please. >> Yeah. And we hurac is not a supplier of address validation services. >> Thank you. Um are we expecting the UPU CN form template to change um to include product IDs? That's a a question directed uh to the UPU perhaps uh one of the co-chairs of the customs group or um could you answer that please? So I guess Kristoff is not online anymore. Kavier, are you online? Please, please take the floor. >> Hi but thank you for giving me the floor. uh and I'd like to maybe if you could repeat the question is related to the product identifiers and that's whether >> they will be taken up in regulations or in standards or so what is the the question exactly >> the question is are we expecting the UPU CN form template to change to include the product ID >> and no we're not expecting the CN forms to change these uh customs declaration forms that are agreed between the WCO and the UPU. Uh we do have a consultation process open with the WCO. Uh but we do not expect them to change before November. The WCOPU contact committee will take place on 4th and 5th of November. Uh and this is just one of the many items that will be discussed. H the current um position of most of the stakeholders involved is that as the number of data elements increase uh it may make more sense to uh start considering um some of these data elements to be provided electronically. uh rather than on the customs declaration form where there may not be sufficient space uh to print on a on a paper form or a label and place this on the uh physical item. Thank you V. >> Thank you Javier. So uh much much more work to be done uh also on UPU level. Um earlier there was a comment about free trade agreements. So I guess this is um directed to Rosislo. Um are these going to be honored on H7, H6, H1 clearance for low value goods? Um >> all right. >> Smaller than €150 or will the€3 be applied regardless of customs clearance type when they are low value consignments smaller than €150? Ros >> as as I said this is a very much open question for the time being but if you ask from the perspective of a merchant or operates through the um postal operators just work with the presumption then it's not because first of all it's only if the H1 declaration is used which is rather unaccessible for postal operators yet on the customs level and then the the the whole approach as I stated in in in my presentation is very much um um the discussion item so far. So uh for the time being I would answer this is not available to you but you have to monitor the situation and probably in a couple of months if and when it comes through the uh uh through the um uh court system in the European Union it might become possible to do it. uh yet the position of the customs that I've sp I've spoken so far is that it's not going to be uh honored if there is the uh distant sale of uh goods. So as much as I can say now, sorry. >> Yeah, thank you very much. Um, of course the consultative committee and close collaboration with the PC customs group uh will monitor uh the ongoing developments for sure. Um, one last summary question. If the sending post does not have a signed agreement with a European designated operator or third party for delivery duty pay, does that mean sending countries will not send outbound um of the um affected create criteria around €150 to EU member countries uh from the 1st of July 2020. 26 onwards. Um that's a very valid question. Perhaps Ravier uh you might clarify that question and that fear um of uh stopping mail being sent because one of the main focuses of the UPU is to keep mail flowing. Kavier please. Um sorry could you elaborate on the question because I >> there seems to be yes there seems to be a fear by designated operators that uh if they have not established an agreement with European designated operators for delivery duty paid um or any other third party for handling these items that they might have to stop outbound into the European Union. Is that a fear which is valid or um um does the UPU um act prevail? >> Um well maybe let me first clarify that not all um European Union countries are requesting the use of DDP or requesting the um the signing of a bilateral agreement. So I think that that that's the first point that needs to be clarified. And the second point is that um most of the European Union's designated operators that are requesting the use of a DDP tool um they are um requesting it for IOSS items. So these are items from commercial senders that um I I believe um are already paying BAT into the IOSS. Uh so the European DOS at destination um feel unable to process those items or some of the European DOS at destination are unable to process those items unless it's within a DDP scheme. But for all other items uh most of these European dos are able to process them with a deliver that place solution or a similar arrangement. Uh there's this post Europe table that we shared uh the link to at the beginning of the webinar. Please review that it includes for each country their specificities. And maybe just one last word on this response is that in all cases um the European designated operators have requested us to communicate that um C2C items under 45 are exempt from these requirements. So there's no need to stop all traffic to to Europe. uh the C2C under 45 are exempt from these requirements. There are also the the there's the special case of items over €150 which are also not processed and not subject to the 3 fee but they are subject to a an H1 uh full customs declaration but they they already are so there's no change there. So for those items that you are sending over €150 today uh with the current process, you will be able to continue doing that afterwards. >> Thank you. >> Okay. Thank you, Van. Sorry if I extended my no. No, this is >> this was very important because it brings us back to the whole deck of this webinar which will be shared uh with all participants. Kavier was kind enough to mention certain links which will be updated as the situation develops. Um ladies and gentlemen, I would very much like uh to thank today for sharing all that information, all that insight from different angles. I'm very grateful to the consultative committee members to have done that. And uh please bear with us. the secretariat will reach out to you and share both the deck and uh the recording uh later today or in the coming days. With that, I would like also to thank uh the CC team in the background for all their very very valid work um putting together the webinar. I would like to thank uh the interpreters and thank you for participating. Thank you very much. Till the next time. Thank you. Goodbye. Thank you everyone. >> Bye-bye. Thank you.