Smiths HP: Strategic Advantage Through European Expansion & Major Changes to EU Import Procedures

MIA Member Smiths HP has shared the following press release.

Strategic Advantage Through European Expansion & Major Changes to EU Import Procedures: Smiths HP and the End of One-Off Fiscal Representation 

From 1st January 2026, the European import landscape will undergo a significant transformation. The French Finance Act 2025 (LOI n° 2025-127 du 14 février 2025) has repealed Article 289 A III of the French General Tax Code, bringing an end to the “one-off fiscal representation” mechanism long used under Customs Procedure 42 (Regime 42).

For years, this mechanism has enabled non-EU businesses to move goods into the European Union through France without the need for direct VAT registration. Freight forwarders or customs agents could act as temporary fiscal representatives, using their own French VAT numbers to facilitate duty-free imports where goods moved immediately to another EU member state.

From 31st December 2025, that simplified route will close. Non-EU businesses will instead need to obtain their own French VAT registration, manage their own VAT returns, and assume full responsibility for EU compliance.

The Strategic Importance of Smiths HP’s European Presence

The establishment of Smiths HP’s new facility in Maranello, Italy positions the company ahead of these regulatory changes — and ahead of competitors who have not yet established an operational footprint within the EU.

By having a European manufacturing and distribution base, Smiths HP is able to:

● Maintain seamless trade across the EU without interruption from changing import procedures.

● Avoid the delays and complexities associated with direct VAT registration or fiscal representation requirements.

● Offer customers within the EU a more efficient, duty-paid supply chain experience without additional import or tax hurdles.

● These challenges compound with other new EU requirements including CBAM reporting and REX origin certification.

This strategic move ensures Smiths HP can continue to provide just-in-time delivery, lower logistics costs, and frictionless customer service within the single market, despite tightening post-Brexit compliance conditions.

What the End of Regime 42 One-Off Representation Means

For non-EU companies — particularly UK manufacturers — this change is significant.

From 2026, businesses that have been importing through France under Regime 42 will face:

● Mandatory direct VAT registration with the French tax authorities;

● Independent VAT filing obligations;

● Longer lead times (French VAT registration can take up to 45 days);

● Additional administrative and accounting costs to maintain compliance.

For companies without an EU presence, these changes will make it harder — and more expensive — to move goods efficiently into European markets.

A Competitive Advantage for Smiths HP

Smiths HP’s proactive investment in Maranello ensures the company and its clients are insulated from these challenges.

“Our investment in Maranello allows Smiths HP to continue supplying European customers quickly and efficiently, without the disruption that these new regulations could cause,” said Squire Moorhouse, Global General Manager of Smiths HP.

“Having a permanent EU presence is now essential for maintaining frictionless trade, and this move demonstrates our commitment to service, reliability, and compliance.”

While competitors in the UK or other non-EU regions will need to set up complex VAT and customs arrangements, Smiths HP will continue operating under its EU-registered entity — fully compliant and fully integrated into the European trading system.

This advantage translates directly into:

● Faster order fulfilment for EU-based customers;

● Simplified invoicing, as sales within the EU can be made under EU VAT rules;

● No import VAT or duty obligations for European clients purchasing from Smiths HP’s Italian facility;

 ● Reduced administrative burden for customers, who avoid the need to act as importers of record.

In contrast, UK-based competitors who continue exporting directly into the EU will find their clients increasingly reluctant to buy on Delivered Duty Paid (DDP) terms. Under the new regime, those clients will be forced to handle import VAT, duty, and customs paperwork themselves — a process that can add both time and cost, and which risks driving customers toward suppliers with established EU operations.

Implications for Competitors Without an EU Base

The regulatory shift exposes a widening gap between companies with a permanent European presence and those still operating solely from the UK.

Competitors who fail to adapt face:

● Longer delivery times as goods are held for customs clearance;

● Higher transactional costs due to new VAT registration and compliance requirements;

● Potential loss of EU customers unwilling to manage the administrative burden of imports;

● Reduced flexibility in meeting supply chain commitments within the European single market.

For manufacturers in high-performance sectors — such as motorsport, aerospace, and precision engineering — where speed, reliability, and regulatory compliance are critical, these disadvantages could be decisive.

Looking Ahead

Smiths HP’s decision to establish its Maranello facility demonstrates both foresight and strategic agility.

By integrating European production and logistics capabilities, the company is:

● Ensuring continuity of service for EU clients;

● Protecting customer relationships from post-Brexit and procedural disruption;

● Strengthening its position as a trusted supplier to major European automotive and motorsport manufacturers. 

“Smiths HP’s proactive approach puts them well ahead of the curve,” said David Hooper, Managing Director of Hooper and Co International Trade Consultancy Ltd, Smiths HP’s freight forwarding and trade compliance partner.

“By establishing a base within the EU, they’ve eliminated a major future barrier for their customers and ensured full readiness for the 2026 regulatory changes.”

As the EU tightens fiscal and customs regulations, Smiths HP’s early investment in local presence and compliance readiness will continue to deliver significant strategic advantages — both for the company and its customers.

Conclusion

The end of one-off fiscal representation under Regime 42 marks a new era for international trade between the UK and the EU.

For Smiths HP, it validates the decision to expand into Maranello, Italy — securing a sustainable, compliant, and competitive foundation for European operations.

While others may face uncertainty, Smiths HP is ideally positioned to continue serving its customers across Europe with speed, efficiency, and full regulatory confidence.

For more information and the implications for businesses in the UK & Europe and to request a copy of Hooper and Co’s document on Important Changes to EU Import Procedures: End of One-Off Fiscal Representation for Regime 42, please email david@hooperandco.com www.hooperandco.com