Amazon & E-Commerce Weekly News #56

The Council of the EU has approved a major customs reform. For e-commerce, it shifts more import responsibility to platforms and sellers and introduces a new fee on small parcels.

For goods sold into the EU from abroad, e-commerce platforms will be treated as importers and become responsible for customs clearance and duties instead of the end customer. Serious and systematic violations could result in fines of up to 6% of the previous year’s annual value of imported goods, loss of customs privileges and even restrictions on access to online platforms.

The EU also plans to introduce an EU-wide handling fee for small e-commerce parcels no later than November 1, 2026. The European Commission has not yet set the amount. This is separate from the customs duty on imports worth up to €150 that has applied since July 1.

Non-EU sellers should review their import setup, customs data and product compliance, then factor the new handling fee into landed costs once its size is announced. The reform is not yet in force: the Council approved it on September 3, but the final text still requires approval by the European Parliament.

Starting November 2, sellers of products subject to enhanced safety requirements will need at least $1 million in liability insurance regardless of their Amazon.com sales volume. The general rule currently kicks in after monthly sales exceed $10,000.

The new rule applies to products covered by Amazon’s enhanced safety listing requirements. Amazon’s published list includes children’s products, dietary supplements and certain other health products, lithium battery products, fire-safety equipment, selected household and medical devices, personal safety products and other categories. Amazon says the list is not exhaustive and can change; sellers should check Seller Central for requirements affecting individual ASINs.

Policies must provide at least $1 million in coverage per occurrence and in aggregate. A separate change affects sellers based in Mainland China: starting November 2, new policies must be obtained through Amazon Insurance Accelerator unless Amazon agrees otherwise in writing. Qualifying third-party policies submitted before that date can remain in place until they expire.

Insurance becomes a mandatory operating cost for affected products even for small sellers that never reach the current $10,000 monthly threshold. Without a qualifying policy, sellers will not meet Amazon’s requirements for these products.

Check Account Health and Amazon’s enhanced safety requirements for your ASINs. If your products are affected, price out qualifying coverage early and have your Certificate of Insurance ready before November 2.

The FTC and 22 states have sued Amazon, alleging the company used a hidden mechanism for years to raise Sponsored Ads costs. Amazon disputes the allegations.

According to the Federal Trade Commission (FTC), Amazon has used a company-calculated minimum click price, known as a soft reserve price, in its ad auctions since 2019. The regulator alleges that advertisers were still told the system operated as a second-price auction, where the winning bidder would typically pay only slightly more than the next-highest bidder.

For Sponsored Products, the share of clicks charged at the advertiser’s full bid allegedly increased from roughly 30–40% in 2021 to around 80% in 2024. The FTC says the practice affected more than one million advertisers and generated tens of billions of dollars in additional revenue for Amazon.

The lawsuit raises questions about Amazon Ads auction transparency because the way CPC is determined directly affects bidding strategy and advertising costs. Amazon says soft reserve prices reflect the market value of ad placements, never exceed an advertiser’s maximum bid and improve ad efficiency by accounting for relevance. It also says inflation-adjusted average Sponsored Products CPC did not increase between 2019 and 2024.

The lawsuit does not change Amazon Ads rules today. But sellers should treat a maximum bid as a price they may actually pay for a click and review campaigns where aggressive bids and automated bid adjustments are pushing CPC close to the profitability threshold.

Amazon is phasing out the old Product Collections format in Sponsored Brands, a placement shown at the top of Amazon search results. Support ends in February 2027 as advertisers move to Collections.

In the old Product Collections format, sellers selected up to three ASINs for an ad. Sponsored Brands Collections expands that to 3–10 products and offers two modes: Manual Collections, where advertisers control the assortment, and Automatic Collections, where Amazon AI selects products from the catalog based on campaign keywords and shopper search queries.

Since September, Amazon has been showing migration recommendations in Campaign Manager and allowing advertisers to migrate campaigns individually or in bulk. Product Collections will no longer be supported starting February 2027. Campaigns with three ASINs can be automatically migrated to Manual Collections with the same products; campaigns with fewer than three ASINs will not migrate automatically.

Automatic Collections changes how the ad assortment can be built: instead of relying on a fixed product set, Amazon can select products it considers most relevant to a shopper’s query. In Amazon’s U.S. internal testing, the new top-of-search format delivered 3.3x higher CTR, 14.2% higher ROAS and 81.9% more orders per search query than the previous format. These are Amazon’s test results, not a guarantee of campaign performance.

Review existing Product Collection campaigns and Amazon’s migration recommendations, especially campaigns with fewer than three ASINs. With Automatic Collections, pay close attention to keywords and shopper search queries because Amazon uses them to select products for the ad. Monitor which ASINs appear and compare CTR, ROAS and sales against Manual Collections.