From 1st January 2026, non-EU companies will no longer be permitted to use limited tax representation in France under Customs Regime 42.
For UK businesses moving goods into the EU under Delivered Duty Paid (DDP) terms – particularly those clearing shipments at the smart border – this change could have significant consequences.
To explore what this means for UK exporters and the freight industry, Chris Roome, Associate Director, Customs & Compliance at Baxter Freight – one of the UK’s leading independent logistics specialists – shares his reaction and expert insight on the impact the legislation change could have on UK firms exporting via the EU:
Image by Thierry Milherou from Pixabay
Will this change become a barrier to trade?
“This is a different way of thinking, and shouldn’t stop any UK business trading with the EU. The official document was released in 2024 with an original start date of January 2025, later postponed to 2026. It’s about French authorities tightening VAT controls and aligning with other EU countries.
“I don’t believe this will undermine UK-France trade relations, and other steps are being taken to make trade easier. This change is about ensuring duty is paid correctly, and on closing VAT loopholes.”
The significance of this change on UK businesses moving goods into the EU under DDP terms
“For customers wanting to use a DDP solution, it adds an extra level of complexity. Ad-hoc consignments become more cumbersome due to the need to set up the EU buyer or obtain a French VAT number, which requires a tax representative. There are ways around this, but it’s key that customers fully understand their options – and my team can help simplify these processes.
“All UK companies exporting via R42 DDP will be affected, but particularly those sending fewer pallets, groupage consignments, or lower-value shipments. Transactional businesses may find the ongoing VAT management fees less cost-effective, so exploring all options will be essential.”
The impact on the wider freight and logistics industry
“Many UK companies may need to set up the EU consignee as the importer of record, which requires a direct representation form. As we saw with Brexit, not everyone understands this and some refuse to complete the documentation. The alternative is setting up R40 with a French VAT number, which involves monthly management fees and potential delays if companies don’t apply early. It currently takes around six weeks to obtain a VAT number, so timing is critical.
“In order to prepare now, UK companies impacted should speak with us about the three solutions available. Reviewing supply chains, understanding who the importer of record is, and checking how goods are routed into the EU – especially via France – are all essential steps. Early preparation will help avoid fines or delays in 2026.
“Customs is already confusing, and changes like this add more complexity. Our role is to take the hard work out of finding the right solution, tailoring it to each customer’s unique situation and guiding them through until they are 100% confident.”
Looking ahead to the future for UK Freight Forwarders
“Forwarders need robust customs expertise, whether in-house or through strong partners. At Baxter Freight, having our own customs department helps keep processes fast and costs under control. The key is to avoid going backwards to outdated methods that tie up cash flow.
“While there does remain some concern around making sure UK exports to the EU don’t slow down, my hope is that more UK companies see exporting as an opportunity: British products are world-class, and with the right guidance, trading with the EU can remain straightforward.”
