E-commerce round-up: Windsor Framework 'provides growth opportunities' as retail market grows

Tue 7 Mar 2023
Posted by: Phillip Adnett
Trade News

Miniature forklift carrying packages across laptop keyboard

Online selling has long been an essential element of many international traders’ business plans, from global giants down to smaller companies.

Recent EU and UK legal updates could change how firms operate, while important marketplaces have reported fluctuating patterns of growth.

Here, the IOE&IT Daily Update rounds up the latest in e-commerce news.

Windsor Framework

Resolving the Northern Ireland Protocol will present the UK’s e-commerce traders with the opportunity to grow the sector, according to industry experts.

E-commerce consultant, Prabhat Shah, told the Daily Express that if the Windsor Framework is approved, it could stop friction on the Irish border overnight.

“It would reassure e-commerce sellers and allow them to focus on growing their businesses instead of worrying about red tape,” he said.

The framework command paper says the agreement would see “the unprecedented removal of requirements” for a customs declaration for consumer parcels, with certain paperwork requirements being scrapped.

The UK has agreed that authorised that fast parcel operators will manage a process of sharing data to monitor smuggling into the European market.

For movements between businesses, the same internal market scheme set out for freight movements will avoid tariffs and rules of origin requirements.

EU regulation

The EU Digital Services Act, introduced in November 2022, has imposed new requirements on online marketplaces and social media networks.

From 17 February 2023, larger online platforms also have to the publish number of active users on their platform, according to E-Commerce News.

From 30 January, online marketplaces have had to report user sales to the tax authorities where the buyer was based, rather than the location of the seller.

The European Commission has released details of the fees they plan to levy on large search engines and online marketplaces under their supervision.

Market growth?

A report by Retail Week found that UK online sales accounted for just 26.6% of total UK retail sales in January 2023, down 0.1% from the previous month and more than 8% down on peak 37.8% in January 2021, Office for National Statistics (ONS) data shows.

High profile e-commerce failures have put question marks over the ‘inevitable’ progress of online shopping, it claims.

In the EU, more consumers are ordering goods online, growing by 20% to 75% in the decade to 2022, according to Eurostat data.

A survey by Technavio notes the US B2C e-commerce market is set to grow by $233.66 billion at a CAGR of 8.12% from 2022 to 2027.

WTO digital debate

WTO director general Ngozi Okonjo-Iweala has urged members to work hard on e-commerce to reach a collective agreement on what to do about the moratorium on e-commerce transactions.

As previously covered in the IOE&IT Daily Update, the WTO extended its 24-year moratorium on applying duties to electronic transactions until the next ministerial meeting, which takes place in February 2024.

The debate split opinion at the 12th WTO Ministerial Conference in Geneva with the US, the UK and the EU arguing in favour of retaining it, while India and South Africa have advocated ending it and allowing tariffs to be charged on electronic sales.

WTO members met recently to discuss the importance of addressing the digital divide to improve the participation of developing and least developed countries in electronic commerce.

Strike delays

Royal Mail has blamed “highly damaging” strikes after revealing just over half of mail sent first class was delivered the next working day in the latest quarter, reports the Shropshire Star.

The company has faced nine days of strike action since before Christmas and staff have voted for more action.

Just 54.1% of first-class mail was delivered the next working day in the three months to December 4, substantially short of its 93% target for first-class delivery.

Meanwhile, employees at Amazon’s Coventry facility took part in a second day of industrial action on 2 March, reports Logistics Manager.

In January, the depot became the first in the UK to take strike action against the online retail giant in pursuit of a pay rise. More strikes are planned for five consecutive days from March 13th to the 17th.