Selling food in the EU after Brexit transition – the need for an EU ‘Establishment’


Paul Cochrane

Paul Cochrane

Tax Director


EU Regulations require that certain food labelling standards are met by Food Business Operators (FBOs) selling food and drinks in the EU. 

All food labelling must contain information about the food, but the regulation also requires that an address for the business responsible for the accuracy of that information is included on labels.

That business must have an establishment in the EU, meaning it must be an EU address which is shown. If a business selling food into the EU has no establishment there, the address of the business which is responsible for importing the food into the EU must be shown instead. The importer will then be responsible for the accuracy of the information contained on the label.

UK FBOs selling food and drink to the EU currently comply with these rules by showing their UK address on labels. When the UK’s transition period for exiting the EU ends on 31 December 2020, showing a UK address will no longer be permitted.

For food labelling purposes ‘establishment’ is not defined; however, the address of a branch or permanent establishment recognised for tax purposes is likely to be sufficient. An address supplied by a registered office provider, where the FBO carries out little or no businesses activities at that address, is unlikely to be acceptable.

UK FBOs without an EU branch or subsidiary must consider what steps are necessary to comply with the EU’s labelling regulations, if food exports to the EU are to continue into 2021. This could include setting up a branch or making agreements with distributors who will import UK food and drink into the EU. The potential tax consequences of alternative actions taken to comply with food labelling regulations should also be considered.

UK FBOs that already have an EU establishment will have to update their labels to show the address of that establishment for food exported to the EU after 31 December 2020.

Need assistance with your next steps?

The VAT team at Johnston Carmichael are here to help. Get in touch with me, Paul Cochrane, to discuss this more, or your usual Johnston Carmichael adviser.