The European Union will increase customs checks on goods shipped directly by ecommerce retailers like Temu and Shein to EU consumers as it seeks to ensure fair competition and product safety, according to a draft of an official communication seen by Reuters on Monday.

The directive from the European Commission, expected to be published on Wednesday, will affect all non-EU ecommerce retailers although it specifically addresses the rapid growth of Temu, an online marketplace owned by Chinese ecommerce giant PDD Holdings, opens new tab, and Shein, a fast-fashion retailer founded in China but now headquartered in Singapore.

Both retailers have undercut local players with ultra-low prices for products made in China, and benefited from an EU law giving parcels worth less than 150 euros (HK$ 1202) duty-free status, a measure critics say gives them an unfair advantage. Clothing, for example, is usually subject to a 12 percent import duty to enter the EU.

The European Union-wide customs operation will prioritise controls on products bought online that present "significant safety hazards and risks of non-compliance", the European Commission said, calling on all member states to participate. The precise list of products will be determined in agreement with member states.