Capitalize on EU VAT Changes and Shipping Rate Fluctuations with Strategic Logistics and AI Tools

The European Commission has proposed a €2 handling fee for all low-value parcels entering the EU, aiming to manage the surge in online shopping imports. This fee would apply to packages valued under €150, effectively removing the current duty-free threshold. The move targets compliance checks, such as toy safety, and would be charged to online retailers, not customers. In 2024, EU customs processed approximately 4.6 billion parcels, with 91% originating from China via platforms like Shein and Temu. The proposal still requires approval from EU governments and the European Parliament.
Source: Reuters, Published on: May 21, 2025

Shopify's Summer '25 "Horizons" Edition introduces over 150 new features designed to enhance merchant experiences. Key updates include AI-powered image generation, unified shipping rates across multiple warehouses, embedded B2B checkout options, and a Managed Payments beta. These enhancements aim to provide faster storefronts and simplified global compliance, enabling merchants to build better experiences and grow their businesses more efficiently.
Source: Shopify Newsroom, Published on: May 21, 2025

FedEx has announced the purchase of over three million gallons of blended sustainable aviation fuel (SAF) from producer Neste, marking its first major U.S. SAF deployment. The fuel will be used for cargo flights out of Los Angeles International Airport (LAX) over the next year, covering approximately 20% of FedEx's annual jet-fuel demand at LAX. This initiative is expected to reduce carbon emissions by an estimated 22,000 metric tons, aligning with FedEx's commitment to sustainability and environmental responsibility.
Source: ESG Today, Published on: May 21, 2025

Google is rolling out ads within its AI-powered search function, known as AI Mode, which was launched in March. This feature is designed to handle more nuanced or complex questions, and the integration of ads aims to monetize these AI-generated search summaries. Advertisers are encouraged to provide richer feed data and multi-language assets to maintain placement quality. This move reflects Google's strategy to enhance user engagement while offering new opportunities for advertisers in the evolving search landscape.
Source: Adweek, Published on: May 22, 2025

TikTok Shop has begun layoffs in the U.S. as part of broader organizational and personnel changes. The layoffs primarily affect employees in U.S. operations and global key accounts, which cater to major brand partnerships. An internal memo cited the need to develop more efficient operating models to support long-term growth. Affected employees are receiving notifications and exit packages, including administrative leave and severance based on tenure. This move follows earlier job cuts in April tied to restructuring efforts within TikTok’s e-commerce governance team.
Source: Business Insider, Published on: May 22, 2025

UPS has announced updates to its international fuel surcharge benchmarks, effective May 22, 2025. The revised jet-fuel index will be reflected immediately, with broader domestic adjustments slated for May 26. These changes signal higher shipping costs for cross-border merchants, emphasizing the need for businesses to reassess their logistics strategies and budget allocations to accommodate the increased expenses.
Source: UPS, Effective as of: May 22, 2025

Chinese e-commerce platforms Shein and Temu are experiencing higher operational costs as a result of new fees imposed by the EU and the U.S. The EU has introduced a €2 flat fee on parcels worth under €150, while the U.S. has reduced tariffs on Chinese imports from 120% to 54% but retained a $100 postal fee for packages under $800. These changes significantly impact the "de minimis" exemption, previously allowing small imports to bypass duties. The increased costs and potential shipping delays are expected to affect lower-income consumers who rely on affordable goods. Retailers may adapt by altering logistics strategies, such as shipping bulk orders to local warehouses before distribution.
Source: Business Insider, Published on: May 21, 2025

Following a recent trade agreement between the U.S. and China that eased previously imposed tariffs, shipping volumes from China to the U.S. have surged dramatically, leading to higher shipping rates. A 275% spike in ocean freight bookings has been reported, with the World Container Index noting an 8% week-over-week rate increase as of May 15. Notable hikes include a 19% rise in rates from Shanghai to New York and a 16% rise to Los Angeles. Experts warn that such uncertainty typically results in increased costs that are eventually passed on to consumers, potentially leading to lower inventory levels and reduced product availability.
Source: Investopedia, Published on: May 21, 2025

Register for IOSS & Display Landed Costs: Prepare early for the EU’s parcel fee and VAT removal to prevent delivery-stage charges.
Leverage Shopify Horizons Features: Deploy AI image tools and unified shipping rates to improve conversion and transparency.
Offer Green Shipping Options: Promote FedEx SAF-powered lanes for faster, lower-carbon delivery.
Optimize Ad Feeds for AI Mode: Ensure structured product data and language variants to maintain visibility in Google’s new format.
Diversify U.S. Fulfilment: Hedge UPS surcharge spikes by testing multi-carrier labels and regional 3PLs.

Agile compliance, sustainable logistics, and rapid tech adoption remain pivotal for independent sellers navigating 2025’s dynamic trade landscape.
Merchants that pivot quickly to new platform capabilities and tariff windows can secure margins and capture demand spikes.

From Amazon Agentic AI to FedEx Tariff Sync: Tools to Improve Global Shipping Efficiency