The European Fulfilment Network is another popular scheme introduced by Amazon which bares a much less VAT liability in Europe than the Amazon Pan-European Program does. By signing up to the EFN scheme you will be required to send your goods to 1 Amazon warehouse, normally local to your business, from here Amazon will dispatch your goods to customs across the EU but will not move your goods around different warehouses and store in different countries creating a new VAT liability.
This no longer works for goods that where previously stored in the UK, prior to Brexit UK businesses could ship their goods to a UK fulfilment centre and Amazon would deliver goods across the EU borders to EU based customs but now due to Brexit and borders being put in place, stock now stored in the UK will only be used to fulfil UK orders. You will now also need to ship stock to an EU warehouse to be able to fulfil EU orders, this requires 1 additional VAT number in the place of storage. For businesses who already stored in an EU warehouse it should be business as usual.
What triggers VAT Registration?
There are a number of conditions that trigger VAT registration but we are going to focus on the ones that you are more likely to come across as an Amazon Seller using the Amazon Seller Central platform.
- Storing Goods – Before you plan to use the FBA programs you should know that storing goods in a country requires a VAT registration where you store. It can take up to 12 weeks to get a VRN in the EU so it’s best to apply ahead of time or you’ll find yourself having to back-date your return filings
- Distance Sales Thresholds – There are various distance sales thresholds per country in the EU and soon an EU wide threshold will be introduced. If you are storing goods using the European Fulfilment Network in 1 country, you will need to be aware of these thresholds. If your sales to one of these countries exceed the distance sales threshold you will also need to register for VAT in that destination, after 1st July 2021 however you can use the One Stop Shop.
- Importing – When importing goods into the EU from the UK or other NON-EU countries you will be aware of Import VAT and Duties, This additional cost to your business can affect cashflow so you will likely want to claim this VAT back (duty is unclaimable) to do this you will need to register for VAT in the country of importation and file a VAT reclaim.
The Amazon European Fulfilment Network (EFN) allows Amazon sellers with a Europe Marketplace account who are also registered for Fulfilment by Amazon to store their inventory in their local fulfilment centre and fulfil orders that come from other European marketplaces(ES,DE,FR,IT) from the same local inventory pool. For example, you store goods in Germany, orders from the Spanish, Italian and French websites can be fulfilled from here.
Yes. EFN inventory can be listed for sale on any (or all) of Amazon’s European marketplaces (UK, Germany, France, Italy and Spain) using your 1 Europe Marketplaces account. When an order from these marketplaces arrives, Amazon will fulfill the order from your inventory stored in your chosen marketplace through their EFN. Note UK & EU must now have 2 separate inventory locations. The UK supplies the UK and an EU location supplies the EU sites.
Yes. However, Amazon’s European accounts do not allow sellers to sell on all Amazon’s international marketplaces. To do this, you must create an Amazon selling account under separate terms in these countries and manage the account separately from your accounts in other geographical locations.
Selling through the EFN, sellers must localise their existing marketplace offers to other Amazon European marketplaces to allow local customers to purchase them. For example, a French-based customer can purchase an German seller’s offer listed on Amazon.fr once the seller has registered its FBA German-based products on the French marketplace.
When selling with FBA Export, sellers make their Amazon marketplace offers available to EU and worldwide customers who can purchase them on the marketplace where the seller has listed their offers. For example, a Netherlands-based customer can purchase a French seller’s offer on Amazon.fr provided that the seller has activated FBA Export on the French marketplace. Thus, if sellers sign up for FBA Export, their FBA products won’t automatically be listed for sale on other Amazon marketplaces.
No, you can send inventory to your local fulfilment centre and only fulfil locally
If you are already using Amazon FBA then you can enable this in your account, you will need to add the unique SKU to each European marketplace
Yes, all FBA orders are eligible for Amazon Prime