- Short answer
- You are — Managed Markets only takes merchant-of-record duties when the order also holds a physical product.
- Mixed order
- Per order, not per store: an eligible order must contain both a digital and a physical product.
- Your duties
- As your own merchant of record, you register for and remit taxes and arrange local payment methods.
- EU buyers
- EU consumers pay VAT on digital goods at their own country's rate, wherever the seller is.
- VAT registration
- Non-EU merchants: Non-Union OSS or local VAT registrations; IOSS doesn't apply to digital goods.
- Draft orders
- On Managed Markets, digital products can't go on draft orders; for a mixed order, send an invoice for checkout.
- EU VAT, digital-only
- Yours, by our reading — no Shopify page we have found says it in one sentence.
- As of
- Managed Markets prohibited-items and overview pages plus the tax-on-digital-products page, read September 28, 2026.
Who is the merchant of record on a digital-only order?
Shopify's rule sits in the Digital products or goods section of its Managed Markets prohibited-items page:
For an order to be eligible on Managed Markets, it must contain both a digital product and a physical product. If your order contains only digital products, then you automatically become the merchant of record for the order.
The rule works per order, not per store: a digital product in the same order as a physical one meets this requirement.
Who handles EU VAT on a digital-only order?
With Managed Markets, Global-e remits tax, accepts local payment methods and manages duties, so you don't need tax registrations in the countries you sell to. As your own merchant of record, you register for and remit taxes, arrange local payment methods and organize shipping and fulfillment.
Shopify's tax-on-digital-products page says EU consumers pay VAT on digital goods at their own country's rate, wherever the seller is. A non-EU merchant registers for Non-Union OSS or for local VAT in each EU country where it does business; IOSS is only for physical goods.
Put together, by our reading, a digital-only order sold to an EU consumer leaves that VAT registration and remittance with you, not Global-e. No Shopify page we have found says this in one sentence — as of September 2026 it is our reading of the Managed Markets prohibited-items and overview pages and the tax-on-digital-products page. This covers EU VAT only, not UK VAT or US sales tax.
What about draft orders and mixed carts?
On Managed Markets, digital products can't go on draft orders. For a mixed order, send an invoice to collect payment at checkout.
No Shopify page we have found describes a way to hide or restrict digital products for Managed Markets alone — as of September 2026, read across its prohibited-items, fulfillment, compare, requirements, activation and deactivation pages.
This article was written entirely by AI under human editorial direction. The editor sets the topic and structure, runs multi-stage validation on facts, links, and interactive elements, and verifies the output is useful from a business perspective. All claims are checked against official Shopify sources. Details may change — always confirm critical data at shopify.com.
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