London Daily

Focus on the big picture.
Sunday, Aug 24, 2025

UK firms told 'set up in EU to avoid trade disruption'

UK firms told 'set up in EU to avoid trade disruption'

UK firms that export to the EU say they are being encouraged by the government to set up subsidiaries in the bloc to avoid disruption under new trade rules.

Firms have been hit by extra charges, taxes and paperwork, leading some to stop exporting to the EU altogether.

But several say they have been told that setting up hubs in Europe would minimise the disruption, even if it means moving investment out of the UK.

The Department for International Trade said it was "not government policy".

"The Cabinet Office have issued clear guidance, available at www.gov.uk/transition, and we encourage all businesses to follow that guidance."

The Cheshire Cheese Company said it had been advised by an official to set up in the EU after it was forced to stop its exports to the bloc due to trade rules that came in on 1 January.

'Only solution'


The firm, which sold £180,000 of cheese to the EU last year, found that every £25-30 gift box of cheese it sends to consumers on the Continent now needs a veterinary-approved health certificate costing £180.

"I spoke to someone at the Department for Environment, Food and Rural Affairs for advice. They told me setting up a fulfilment centre in the EU where we could pack the boxes was my only solution," co-founder Simon Spurrell told the BBC.

The firm, which had been optimistic about Brexit, is now looking at setting up a hub in France where it would "test the water".

But it has also scrapped plans to build a new £1m warehouse in Macclesfield employing 20-30 people.

"Instead we might end up employing French workers and paying tax to the EU," Mr Spurrell said.

"I left the EU as a UK citizen but now they are suggesting I rejoin my company to the EU, so what was Brexit for?"

'Set up shop in Germany'


The issue, he said, was that the under the post-Brexit trade deal, a vet must approve every consignment of fresh food that his company ships to the EU.

It is a complex and costly process that has hit exporters of fresh meat and fish as well, and was partly why the government set up a £23m support fund for UK fishing companies.

UK retailers who export to the EU have also complained about being hit with unsustainable costs when customers in the bloc return goods bought online. This is due to new customs clearance charges incurred by shipping firms.

Some retailers have even warned they could burn clothes stuck at borders as it is cheaper than bringing them home.


Ulla Vitting Richards
Ulla Vitting Richards, who runs her sustainable fashion brand Vildnis from the UK, told the BBC last week she had stopped exporting to the EU, which was her fastest growing market, because of the new processes.

She also said that she had been advised - this time by a Department for International Trade (DIT) representative - that setting up a subsidiary distribution hub might help.

"He told me we'd be best off moving stock to a warehouse in Germany and get them to handle it," she said.

As early as last October, trade consultants Blick Rothenberg warned that thousands of UK businesses might need to set up an EU presence in order to keep exporting to European markets.

However, experts say EU firms exporting to the UK - which currently enjoy a grace period over the imposition of some rules - will soon face the same issues.

Indeed, some EU exporters have already stopped deliveries to the UK because of new VAT related charges.

The DIT said it was not government policy to advise UK firms to set up EU hubs and that it was "ensuring all officials are properly conveying" the right information.

Newsletter

Related Articles

0:00
0:00
Close
Deputy Prime Minister Angela Rayner Purchases Third Property Amid Housing Tax Reforms Debate
HSBC Switzerland Ends Relationships with Over 1,000 Clients from Saudi Arabia, Lebanon, Qatar, and Egypt
Sharia Law Made Legally Binding in Austria Despite Warnings Over 'Incompatible' Values
Italian Facebook Group Sharing Intimate Images Without Consent Shut Down Amid Police Investigation
Dutch Foreign Minister Resigns Amid Deadlock Over Israel Sanctions
Trump and Allies Send Messages of Support to Ukraine on Independence Day Amid Ongoing Conflict
China Reels as Telegram Chat Group Shares Hidden-Camera Footage of Women and Children
Sam Nicoresti becomes first transgender comedian to win Edinburgh Comedy Award
Builders uncover historic human remains in Lancashire house renovation
Australia Wants to Tax Your Empty Bedrooms
MotoGP Cameraman Narrowly Avoids Pedro Acosta Crash at Hungarian Grand Prix
FBI Investigates John Bolton Over Classified Documents in High-Profile Raids
Report reveals OpenAI pitched national ChatGPT Plus subscription to UK ministers
Labour set to freeze income tax thresholds in long-term 'stealth' tax raid
Coca‑Cola explores sale of Costa coffee chain
Trial hears dog walker was chased and fatally stabbed by trio
Restaurateur resigns from government hospitality council over tax criticism
Spanish City funfair shut after serious ride injury
Suspected arson at Ilford restaurant leaves three in critical condition
Tottenham beat Manchester City to go top of Premier League
Bank holiday heatwave to hit 30°C before remnants of Hurricane Erin arrive
UK to deploy immigration advisers to West Africa to block fake visas
Nurse who raped woman continued working for a year despite police alert
Drought forces closures of England’s canal routes, canceling boat holidays
Sweet tooth scents: food-inspired perfumes surge as weight-loss drugs suppress appetites
Experts warn Britain dangerously reliant on imported food
Family of Notting Hill Carnival murder victim call event unmanageable
Bunkers, Billions and Apocalypse: The Secret Compounds of Zuckerberg and the Tech Giants
Ukraine Declares De Facto War on Hungary and Slovakia with Terror Drone Strikes on Their Gas Lifeline
Animated K-pop Musical ‘KPop Demon Hunters’ Becomes Netflix’s Most-Watched Original Animated Film
New York Appeals Court Voids Nearly $500 Million Civil Fraud Penalty Against Trump While Upholding Fraud Liability
Elon Musk tweeted, “Europe is dying”
Far-Right Activist Convicted of Incitement Changes Gender and Demands: "Send Me to a Women’s Prison" | The Storm in Germany
Hungary Criticizes Ukraine: "Violating Our Sovereignty"
Will this be the first country to return to negative interest rates?
Child-free hotels spark controversy
North Korea is where this 95-year-old wants to die. South Korea won’t let him go. Is this our ally or a human rights enemy?
Hong Kong Launches Regulatory Regime and Trials for HKD-Backed Stablecoins
China rehearses September 3 Victory Day parade as imagery points to ‘loyal wingman’ FH-97 family presence
Trump Called Viktor Orbán: "Why Are You Using the Veto"
Horror in the Skies: Plane Engine Exploded, Passengers Sent Farewell Messages
MSNBC Rebrands as MS NOW Amid Comcast’s Cable Spin-Off
AI in Policing: Draft One Helps Speed Up Reports but Raises Legal and Ethical Concerns
Shame in Norway: Crown Princess’s Son Accused of Four Rapes
Apple Begins Simultaneous iPhone 17 Production in India and China
A Robot to Give Birth: The Chinese Announcement That Shakes the World
Finnish MP Dies by Suicide in Parliament Building
Outrage in the Tennis World After Jannik Sinner’s Withdrawal Storm
William and Kate Are Moving House – and the New Neighbors Were Evicted
Class Action Lawsuit Against Volkswagen: Steering Wheel Switches Cause Accidents
×