Iceland Seafood UK said its processing factory in Grimsby, employing almost 200 people, was no longer deemed “a strategic fit” for the company.
The potential job losses follow a merger of its Bradford operation into the Grimsby site as part of a decision to invest in new facilities in March 2020.
“The renovation and installation of the factory was very much affected by Covid and later Brexit along with difficulties in overall operations,” the company said.
The statement added: “Although it has been concluded that the UK operation is not a strategic fit for Iceland Seafood anymore, the excellent facilities and strong management team in Grimsby can be a great addition to other companies in the sector.”
Chief executive Bjarni Ármannsson said the costly red tape following the UK’s exit from the EU had hurt the company’s ability to import fish and seafood for processing and sale.
“The UK market has become more difficult post-Brexit. The UK has become more cumbersome in terms of paperwork,” he said.
Iceland Seafoods has hired Icelandic firm MAR Advisors in an effort to find a buyer for the processing factory, with the impact on jobs not yet clear.
North East Lincolnshire, the area where the Grimsby factory is found, voted 69.9 per cent (55,185) to leave the EU and 30.1 per cent to remain at the 2016 Brexit referendum.
But rows over both fishing rights and extra paperwork have dogged the industry since the Brexit trade deal kicked in at the start of 2021 – despite promises of taking back “control” of fishing waters.
The National Federation of Fishermen’s Organisations (NFFO) said last year that the sector had been “sold out” by the Brexit deal.
It comes as Rishi Sunak insisted the UK will not realign with EU laws under his watch as the government seeks to sink speculation it is weighing up a Swiss-style relationship with the EU.
The prime minister said he wished to be “unequivocal” that he “will not pursue any relationship with Europe that relies on alignment with EU laws”.
But business leaders have urged him to consider to Swiss-style alignment, or even fuller access to the EU single market.
Former Siemens UK chief executive Juergen Maier – vice-chair of the Northern Powerhouse Partnership – urged Mr Sunak to “open his mind” to new possibilities.
“The thing that’s so difficult for business people to understand is that ideology is getting in the way of economic pragmatism,” Mr Maier told The Independent.
“We need to be able to have a conversation about alignment. The idea of a Swiss-style arrangements is not a bad direction, but is it the answer? No. It would take forever to arrange many bilateral agreements that the Swiss have with the EU.”
He added: “A better model is fuller access to the single market, whether it’s done by EEA (European Economic Area) membership or a bespoke arrangement. It’s time to open the mind and truly listen to business.”
Meanwhile, a government-appointed body said the Sunak government’s legislative plan to ditch thousands of pieces of retained EU Law was “not fit for purpose”.
In a damning report, the regulatory policy committee (RPC) said it was “not assured” that the impact of changing or sunsetting each rule and regulation will be properly “calculated or understood”.
Frances O’Grady, the TUC’s general secretary, said the report showed why the Retained EU Law bill was putting vital workplace protections at risk. “They do not have mandate to slash and burn people’s rights at work. They must ditch this toxic bill now,” she said.