Eurora Solutions, an Estonian artificial intelligence company, has raised USD40 million in funding to tackle e-commerce shipping delays caused by the European Union regulation changes.
The company, characterising itself as an “artificial intelligence and machine learning-backed cross-border e-commerce compliance platform”, said in a statement that it already has 300 paying clients worldwide. Now it is planning to use the new funding for expansion in the UK, the US and the Middle East.
According to the company, in July 2021, the European Union ended the €22 import value added tax exemption – the VAT is now charged on all imported commercial goods – and new trading regulations between the EU and the rest of the world gradually came into effect.
“This was intended to create a level playing field with local European manufacturers and retailers. Complying with this new regulation in the high volume, low value-per-package e-commerce market has been a challenge for merchants and logistics operators from the UK, the US, China and the rest of the world,” the company said in a statement.
“These players are looking for software-based solutions that can help handle the billions of cross-border packages affected by this new EU regulation. Solutions with a high degree of accuracy, speed and at a low cost per package are required.”
Automating tax, compliance and customs services
Eurora says its platform automates tax, compliance and customs services. “It assigns e-commerce products an appropriate HS code, calculates the applicable VAT and duty amounts and automatically creates electronic declarations for EU duties and taxes via simple API integration. The platform delivers more than 96% accuracy for e-commerce packages despite often patchy input data and operates at a fraction of the time and price of hybrid or manual code allocation solutions commonly used today.”
The HS code, referenced by the company, is a harmonised system code that is a standardised numerical method of classifying traded products. It’s used by customs authorities around the world to identify products when assessing duties and taxes and for gathering statistics.
The company says its platform can be used by online sellers, marketplaces, logistics and postal companies, as well as tax and customs authorities, and it can automatically process 5,000 requests per second with up to 96% accuracy.
The investment round was led by the Amsterdam-based Connected Capital, with existing investors, including Change Ventures, Equity United and Eurora’s founder Marko Lastik also participating.