Policy & Compliance
Regime 42 – Changes in France from January 2026 As a result of the changes, some sellers may need either to apply for VAT registration in France or liaise with their trading partners to change the way they handle the import process
VAT registration in France as they could utilise the VAT number of their local fiscal representative. However, the upcoming rule changes in France regarding the requirement to be established in the EU to use limited fiscal representation mean that this arrangement will not be available to traders without EU- establishment from January 2026. The result of this change may be significant. Some sellers may either need to apply for VAT registration in France or liaise with their trading partners (if EU-established) to change the way they handle the import process altogether. Some may want to consider re- routing their consignments as this particular change is specific to France and the French VAT law. Whichever solution traders opt for, it is important that they and their agents act now as time is limited and some processes may be lengthy and require a lot of information to finalise. More information can be found under the link below: Procedure: Importing goods supplied to another EU Member State exempt from VAT | Portal of the Directorate General of Customs and Indirect Taxes.
O nward supply relief, or as many refer to it Regime 42, has always been a procedure attracting much attention. And there are a number of reasons for that. The absence of a fully centralised clearance system in the European Union allowed traders supplying goods onward to traders based in another member state to simplify the process and potentially improve their cashflow, as VAT would effectively be paid in the country of final destination. But for that reason, the regime was also subject to additional control measures by authorities as its abuse was common and frequently led to significant losses of revenue for governments in the EU, including the UK at the time.
After the UK left the EU, the use of the regime was limited to movements from Northern Ireland to the EU. At that point though, it became popular with UK traders selling goods under the Incoterm DDP (or similar arrangements) with the purpose of reducing the burden associated with the importation process to the importer. Limited fi scal representative In France, the key point of entry from the UK into the EU, limited tax representation made it possible for traders to appoint a limited fiscal representative to import goods under Regime 42 and supply them onward to another member state. This arrangement allowed UK- based businesses not to apply for
“ In France, ... limited tax represent- ation made it possible for traders to appoint a limited fiscal represent- ative to import goods under Regime 42
December 2025 | 11
www.bifa.org
Made with FlippingBook Annual report maker