Regime 42 under review: EU reshapes VAT and customs on imports

As EU member states continue tightening their VAT and customs compliance rules, businesses importing goods into the EU should be alert to significant upcoming changes, particularly those affecting the use of Regime 42.

This procedure allows importers to defer payment of import VAT at the point of entry when goods are immediately dispatched to another EU member state. Several EU countries are now reviewing how Regime 42 operates, introducing changes to promote greater consistency and strengthen VAT compliance across the single market.

France ends Regime 42 VAT relief

From 1 January 2026, non-EU businesses importing goods into France will be required to register for French VAT and must hold their own French VAT and EORI numbers.

Up until the end of 2025, there was a transition period but after January 2026, even if you still use Regime 42, you will face the same VAT registration and reporting burdens as any importer in France. These new obligations will be relevant where goods are imported into France under delivered duty paid (DDP) incoterms, as the simplified Regime 42 procedures previously available to non‑EU businesses using DDP movements are being withdrawn.

France also operates an automatic reverse charge of import VAT — a system similar to the UK’s postponed import VAT accounting (PIVA) — meaning that once registered for French VAT, importers can defer payment of import VAT and declare and recover it simultaneously through their French VAT return, resulting in a cash‑neutral position.

What this means for your business

If you currently use France as your entry point into the EU to benefit from Regime 42, you need to review and adapt your supply chain before 2026. Consider:

• registering for French VAT and submitting French VAT returns; or
• rerouting imports through another EU member state that still offers simplified procedures.

Regime 42: VAT exemption on imports into Italy

From October 2024, Italy has introduced reforms aimed at strengthening controls and preventing abuse of Regime 42. Under new measures, certain importers, particularly those identified as higher risk through customs analysis, will need to provide a financial guarantee (bond) to access the procedure. This requirement is selective, not universal, and will generally not apply to operators with authorised economic operator (AEO) status or a strong compliance record.

These developments stem from Italy’s reclassification of import VAT — effective from 4 October 2024 — as a customs duty collected by the Customs Agency, except where goods are imported under Regime 42, a carve‑out that previously enabled importers to avoid paying import VAT at the border and contributed to misuse of the procedure.

What this means for your business

If you import via Italy using Regime 42, expect:

• additional compliance costs, such as guarantee fees or documentation expenses;
• the need to maintain detailed evidence that goods are transported to another EU member state; and
• longer customs clearance times if you fall within a high-risk profile.

Contact us to prepare for change

To help stay ahead, review your import routes and seek local VAT and customs advice to ensure documentation, declarations and fiscal representation arrangements meet the new requirements.

Moore Kingston Smith’s VAT specialists help you evaluate your exposure to Regime 42, review and plan to minimise disruption as the new rules come into effect across the EU. Get in touch today.