From 1st January 2026, France will be implementing significant changes meaning businesses moving goods into the EU under Delivery Duty Paid (DDP) will face major changes.
What is Regime 42?
Historically, Regime 42 in France has allowed non-EU businesses, including UK based traders, to import goods into France via a limited tax representative, without paying import VAT or registering for VAT, where goods were to be transported to other EU member states. The onward movement of goods qualified for zero-rating as an intra-EU supply of goods.
What are the key changes?
From 1st January 2026, one-off fiscal representation will be repealed. In practice, this means that registered customs representatives are no longer permitted to use their own VAT number to act as a one-off fiscal representative for imports under Regime 42 on behalf of companies not established in the European Union.
In short, VAT registration and VAT return filing in France will be mandatory for UK businesses importing goods into France under DDP terms.
Direct consequences for non-European businesses
Businesses will now have to obtain an individual VAT number in France and file VAT returns. British companies and other businesses not established in the European Union must therefore anticipate the obligation and register for VAT in France before 31st December 2025 to continue importing using Delivered Duty Paid (DDP).
What can businesses do to prepare for the changes to Regime 42?
There are a few steps businesses can do to prepare for the coming changes:
- Obtain a French VAT number: from 1st January 2026, businesses will need to register to obtain a French VAT number to continue to import under DDP terms.
- Change Supply Chains: Reroute shipments via another EU territory where fiscal representation for non-EU businesses remains available.
- Adapt import processes: businesses must review and adjust their logistic processes to comply with any new import requirements
- EU VAT Returns: If continuing to trade via DDP terms and obtaining a VAT registration, implement a mechanism to submit the relevant returns
- Assess costs: businesses must analyse the financial impact of the new regulations and potentially adapt supply chains and incoterms in line with the changes
How can our team help?
UK businesses should plan ahead and ensure that all necessary registrations and changes are completed well in advance of 1st January 2026 to avoid disruptions to trade.
Our VAT and Indirect taxes team can assist with determining the best way forward. Whether that’s an amendment to your supply chain or a VAT registration and ongoing reporting in France. The registration process can take in excess of 45 days, so we recommend acting now to avoid delays at the border.
Get in touch today to see how we can help.
