EU Food Innovation Exodus: Startups Flee Strict Regulations

European Food Innovation at a Crossroads

The head of the world's largest food innovation community has issued a stark warning: European Union regulations are driving food technology startups to relocate outside the bloc, threatening Europe's position in the global food innovation race. Richard Zaltzman, CEO of EIT Food, told the European Newsroom that strict regulatory requirements and lengthy approval processes are creating an environment where promising companies simply cannot afford to stay.

The Regulatory Barrier

Speaking on the sidelines of the Next Bite 2025 event in Brussels, Zaltzman highlighted the particular challenges facing companies working on gene editing technologies. 'Anyone who's working on gene editing, they can only get so far within the current European system without going through a lengthy process of applying for EFSA [European Food Safety Authority] certification, and that can be very expensive and time consuming for small companies,' he explained.

The EFSA certification process for genetically modified organisms can take years and cost millions, creating an insurmountable barrier for startups with limited resources. Zaltzman noted that 'When you look at the evidence, some European start-ups are going abroad once they get to a certain stage because they can't get to market in Europe either at all, in the case of gene-edited technologies, or they struggle to get to market in a timely manner if they need EFSA approval, compared to how they could do that in a regulatory environment like Singapore or the US.'

Hope on the Horizon

Despite these challenges, Zaltzman expressed cautious optimism about upcoming EU initiatives. He pointed to the Biotech Act and the European Commission's Competitiveness Compass as potential game-changers. 'I'm optimistic that the environment will support European startups to realise their potential here in Europe, whilst also keeping a very strong focus on food safety and the health of European citizens. So it seems that the wind it's going in the right direction for sure,' he stated.

The Commission led by President Ursula von der Leyen has vowed to boost European competitiveness through its Competitiveness Compass, specifically targeting startup-friendly environments. Zaltzman noted that 'There are definitely doors opening for sure. Whether that's going to be in regulatory sandbox environments where there's testbeds for this to happen in specific countries or regions, even, there's clearly a desire to capture the growth opportunity.'

The Labeling Controversy

Zaltzman also weighed in on the recent European Parliament vote to ban meat-related terms for plant-based and cell-cultured products. The decision, which would prohibit names like 'burger' and 'sausage' for non-meat alternatives, has sparked significant controversy across the food industry.

'I'm disappointed in the European stance on nomenclature,' Zaltzman told enr, calling the decision 'an unnecessary inhibition for companies working in this space' and 'an unnecessary closing of a door to allow companies to put their products on the shelf alongside a comparative product.'

He challenged the fundamental premise of the labeling restrictions, noting that 'any sausage you buy is not a pure pork product. It's only about 60 percent meat. The rest is grains and wheat and other additives. Neither are most burgers that you buy. So this idea that you're protecting a pure product is actually a fallacy to start with.'

The Future of European Food Innovation

EIT Food, as one of the Knowledge and Innovation Communities established by the European Institute of Innovation and Technology, plays a crucial role in supporting food innovation across Europe. The organization recently announced its 2025 cohort of 65 groundbreaking startups through its Accelerator Network, demonstrating the vibrant innovation ecosystem that exists despite regulatory challenges.

However, Zaltzman's warning serves as a critical reminder that innovation cannot thrive in an environment of regulatory uncertainty and excessive bureaucracy. As Europe seeks to position itself at the forefront of sustainable food systems and technological advancement, the balance between safety regulation and innovation support will be crucial.

The ongoing negotiations between EU member states and the Parliament will determine the final shape of both the labeling restrictions and broader biotechnology regulations. For Europe's food innovation community, the stakes couldn't be higher - the decisions made in Brussels today will determine whether European startups can compete globally or whether they'll continue their exodus to more welcoming regulatory environments.