Costa Coffee Economic Audit

Target Entity: Costa Limited (trading as Costa Coffee), a wholly-owned subsidiary of The Coca-Cola Company (TCCC)
Audit Phase: V-ECON — Economic Forensics
Research Date: 2026-05-01
Prepared By: Domain Audit Process

Supply Chain & Sourcing Relationships

Direct Supplier Relationships

Costa Coffee does not publish a named fresh-produce supplier list. Its Tier 1 supplier disclosures reference food manufacturing partners but do not identify individual agricultural producers or Israeli exporters by name.⁴⁵²¹ No verified direct commercial contract between Costa Coffee and any Israeli produce exporter — including Mehadrin, Hadiklaim Israel Date Growers Co-operative, Galilee Export, or any successor to the former state-linked Agrexco — has been identified in publicly accessible records. No public evidence identified of such direct contracts.

Costa’s food-to-go range (sandwiches, salads, bakery, fruit pots) is manufactured by Tier 1 UK contract food producers operating under finished-goods supply arrangements. Greencore Group plc is publicly established as a major UK sandwich and food-to-go manufacturer supplying high-street retailers and coffee chains; Bakkavor Group plc is publicly established as a major UK fresh prepared foods manufacturer.^16172324 Neither company names Costa Coffee as a customer in its public annual reports or investor filings. The assertion that either company holds a specific Costa Coffee supply contract is unverified in public records — commercially plausible given sector structure, but unconfirmed.

Identified Israeli Exporters Active in the UK Market

Three Israeli exporters active in the UK market are relevant to the structural landscape:

• Hadiklaim Israel Date Growers Co-operative (brands: King Solomon, Jordan River) is the dominant global exporter of Israeli Medjool dates. Hadiklaim sources from grower-members including operations in the Jordan Valley (West Bank).²⁶ Its products are distributed into UK retail and foodservice.
• Mehadrin is a major Israeli fresh produce exporter covering citrus, avocados, and herbs, with established UK distribution.²⁷
• Galilee Export exports fresh herbs and vegetables to European and UK markets.²⁹
• Agrexco (state-linked Israeli exporter) collapsed in 2011 and ceased operations; its UK market position was partially absorbed by Mehadrin and other exporters.²⁸

Whether any of these exporters supply Costa’s Tier 1 aggregators for Costa-specific products, no public evidence has been identified.

Importer of Record Structure

Costa Coffee’s publicly available corporate structure does not include a dedicated fresh-produce import subsidiary in the UK. No wholly-owned importer-of-record entity for agricultural goods has been identified.²³³⁷ Under the standard UK food-to-go supply model, finished-product manufacturers or their ingredient sub-suppliers act as importers of record for raw agricultural inputs. Costa receives finished goods assembled at UK facilities.⁴²³²⁴ No public evidence identified of Costa acting as its own importer of record for Israeli or any fresh produce.

Seasonal Sourcing Patterns

No Costa Coffee corporate filing, sustainability report, or press release identifies seasonal fresh-produce sourcing windows or Israeli supply lanes.⁴⁵²¹³³ No public evidence identified for Costa-specific seasonal sourcing from Israel or the occupied territories.

Reynolds Food, a major UK foodservice fresh produce distributor, publishes regular crop reports tracking produce availability by country, and identifies Israel as one of multiple supply origins for specific crops including herbs, citrus, peppers, cherry tomatoes, and new potatoes.¹⁸ Whether Reynolds holds any supply relationship with Costa Coffee — directly or indirectly — is not confirmed in public records.

As a market-wide structural observation (not Costa-specific evidence): Israel is an established source of fresh herbs, cherry tomatoes, peppers, citrus, and Medjool dates to the UK market, particularly during the November–April window when Northern European production is limited.¹⁸³⁸³⁹ This is a sector-level pattern; no Costa-specific sourcing has been confirmed.

Third-Party & Indirect Sourcing

No public evidence identified of Israeli-origin products reaching Costa Coffee via named third-party distributors under white-label or resale arrangements. The structural plausibility of indirect exposure via Tier 1 food manufacturers’ own ingredient supply chains cannot be ruled out from public records, but remains unconfirmed at any product-specific level.

Product Origin, Labeling & Regulatory Compliance

Settlement-Origin Products

No NGO report — including those published by Who Profits, Corporate Occupation, Human Rights Watch, or Oxfam — has named Costa Coffee as a retailer of settlement-origin goods.⁶²⁰ No public evidence identified of regulatory citations, DEFRA audit findings, or UK customs enforcement actions naming Costa Coffee in connection with mislabeled settlement produce.

Human Rights Watch has documented Palestinian child labour in Israeli agricultural settlements in the West Bank in relation to the broader agricultural sector,⁴⁰ but HRW’s published findings in this area do not reference Costa Coffee or its supply chain.

UK Regulatory Framework: DEFRA Settlement Labeling Guidance

DEFRA published guidance (updated 2020, confirmed as UK government policy post-Brexit) that produce from Israeli settlements in the West Bank, Gaza Strip, Golan Heights, and East Jerusalem must be labeled as originating from those specific locations rather than generically as “Produce of Israel.”¹⁹ This guidance applies to pre-packed retail goods. Its application to compound ingredients used as inputs in catering-grade or food-service processed products represents a known regulatory gap: finished prepared foods assembled in the UK and sold by catering operators are not subject to ingredient-level country-of-origin disclosure requirements under current UK law. Costa Coffee’s food-to-go products carry “Produced in the UK” or equivalent labeling consistent with this framework.

The UK Government has not issued any enforcement action, advisory notice, or fine naming Costa Coffee or its Tier 1 food manufacturers in connection with settlement-produce labeling. No public evidence identified.

Corporate Labeling Policy

Costa Coffee’s published sustainability documentation — including Modern Slavery Statements for 2023–24 and 2024–25 and its Sustainability pages — contains no policy addressing sourcing from or labeling of goods from occupied or contested territories.⁴⁵²¹ TCCC’s Supplier Guiding Principles and 2023 ESG/Business and Sustainability Report likewise contain no specific policy excluding or requiring disclosure of sourcing from Israeli settlements.²⁵³³ No public evidence identified of any Costa or TCCC corporate policy on this subject.

Costa Supplier Code of Conduct

Costa Coffee publishes a Supplier Code of Conduct.³⁶ No provision within that code, as publicly available, specifically addresses geographic sourcing restrictions, settlement-origin produce, or occupied-territory supply chain considerations.

Investment, Capital & Financial Exposure

Costa Coffee Direct Capital Exposure

No public evidence identified of Costa Coffee (Costa Limited) holding direct capital investments, real estate, logistics infrastructure, or operational facilities within Israel or the occupied territories. Costa does not operate retail stores in Israel.¹² Costa holds a franchise presence across several Middle East markets (UAE, Kuwait, Bahrain, Jordan, Saudi Arabia, Egypt) through regional franchise partners, but Israel is not identified as an active Costa franchise market in any public corporate disclosure.¹²

No public evidence identified of Costa Coffee operating R&D facilities, technology partnerships, or innovation programmes within Israel.

Parent Ownership: The Coca-Cola Company

TCCC acquired Costa Limited from Whitbread plc for £3.9 billion, completing the acquisition on 31 January 2019. Costa is a wholly-owned subsidiary of TCCC.³ All material financial exposure at the parent level therefore flows upstream to Costa’s balance sheet through consolidated group accounting.

TCCC–CBC Franchise Relationship

TCCC operates in Israel through its exclusive franchise partner, The Central Bottling Company (CBC), controlled by the Wertheim family. TCCC does not hold a direct ownership stake in CBC; the relationship is structured as a long-term exclusive franchise and concentrate-supply agreement.⁶⁷⁹ The financial relationship is accordingly one of ongoing commercial flows (concentrate payments, brand licensing) rather than equity ownership.

2024 Tel Aviv District Court Ruling — Transfer Pricing

In August 2024, the Tel Aviv District Court ruled in a transfer-pricing case (Case No. AM 16567-07-17) between the Israeli Tax Authority and CBC. The court found that a “special relationship” exists between TCCC and CBC within the meaning of Israeli transfer-pricing law, determining that TCCC’s concentrate payments from CBC embedded royalty components for intellectual property and brand use, and that CBC had underpaid tax as a result. The court ruled in favour of the Israeli Tax Authority.⁷⁸⁹¹⁰ This ruling constitutes formal judicial recognition of the economic interdependence between TCCC and CBC, though it does not establish equity ownership or control.

CBC — Atarot Industrial Zone

Who Profits Research Centre (2024) documents CBC as operating a distribution facility in the Atarot Industrial Zone — an Israeli industrial estate located in Occupied East Jerusalem, built on land expropriated from the Palestinian communities of Beit Hanina and Qalandia.⁶¹¹ Who Profits characterises this as a settlement operation. Whether this facility remains operationally active given conflict-related disruptions from October 2023 onward is not confirmed in post-2023 public sources.

CBC Stake in Tabor Winery

CBC is documented as holding a controlling stake in Tabor Winery. Tabor Winery’s own website states that it operates vineyards at Mount Shifon in the Golan Heights and at Har Bracha in the West Bank (Samaria).⁶³⁴ Both territories are classified as occupied under the majority position of international law: the Golan Heights was annexed by Israel in 1981 but this annexation is not internationally recognised; the West Bank has been under Israeli military occupation since 1967. This relationship is supported by Who Profits documentation and Tabor Winery’s own published disclosures as of 2024. The precise current ownership percentage is not confirmed in freely accessible public filings.

TCCC “The Bridge” — Tel Aviv Innovation Programme

TCCC founded a commercialisation accelerator programme, “The Bridge by Coca-Cola,” operating from Tel Aviv. A 2017 TCCC press release confirmed the programme’s expansion, with additional corporate partners including Mercedes-Benz and Turner/WarnerMedia, and a doubling of participating Israeli startups.¹⁴ PitchBook lists “The Bridge by Coca-Cola” as an investor profile.¹⁵ Whether the programme remains operationally active in 2025–2026, has been restructured, or was wound down after 2020 cannot be confirmed from available public records; the most recent confirmable public announcement pre-dates 2020.

CBC Investment in Biomilk

CBC made a strategic equity investment of approximately $2 million in Biomilk, an Israeli food-tech startup developing cultivated milk products, announced July 2021.¹²¹³ This investment was made by CBC (the Israeli franchisee), not directly by TCCC or Costa Coffee. The causal claim that this investment creates a direct financial conduit between Costa Coffee revenues and the Israeli economy is not supported in public records; it is an inferential chain only. Biomilk’s current operating status and whether the CBC investment has been increased, maintained, or exited post-2022 is not confirmed in available sources.

Portfolio & Fund Exposure

No public evidence identified of Costa Coffee or TCCC holding Israeli sovereign bonds, Israeli-domiciled equity funds, or Israel-focused investment vehicles in disclosed portfolio holdings.

Operational Presence & Market Activity

Physical Footprint

Costa Coffee does not operate company-owned stores, offices, warehouses, or support centres in Israel or the occupied territories.¹²⁶ This is consistent with TCCC’s own Israeli market structure, which routes all Israeli commercial activity through CBC rather than through direct TCCC or Costa operations. No public evidence identified of any Costa Coffee operational presence — owned or leased — in Israel or the occupied territories.

Employment & Tax Registration

No public evidence identified of Costa Coffee employing staff, holding a branch registration, or holding tax registration in the Israeli jurisdiction.

Franchise Territory Disclosure

Neither Costa Coffee’s annual reports and sustainability disclosures, nor TCCC’s annual 10-K filings, characterise Israel as a Costa market.²⁴⁵ Israel does not appear in any Costa franchise territory disclosure reviewed. No public evidence identified of Costa characterising Israel as a current, past, or planned franchise market. The completeness of publicly available franchise territory lists cannot be guaranteed, but absence of Israel is consistent across all reviewed corporate sources.

Boycott & Civil Society Activity

Costa Coffee has been the subject of student and civil society boycott campaigns in the UK predicated on its status as a TCCC subsidiary. Undeb Bangor (Bangor University student union) publicly documented demands for the university to boycott Costa Coffee and Starbucks in 2024 on grounds related to their parent companies’ Israel connections.⁴³ Ethical Consumer, Inminds, and the Boycat platform list Coca-Cola — and by extension Costa as a TCCC subsidiary — in their boycott databases.³⁰³¹³² These campaigns are civil-society advocacy positions and do not constitute evidence of operational or investment ties specific to Costa Coffee.

Machine Equipment

Costa Coffee’s in-store espresso machine infrastructure has historically used equipment manufactured by Thermoplan AG, a Swiss precision engineering company.³⁵ No Israeli equipment, technology, or supply relationship associated with Costa’s operational infrastructure has been identified in public records.

Corporate Structure & Foundational Ties

Founding & Incorporation History

Costa Coffee was founded in London in 1971 by Italian-born brothers Sergio and Bruno Costa.¹³ The company has no Israeli founding origin, Israeli incorporation history, or Israeli-origin brand identity. Costa was acquired by Whitbread plc in 1995 [pre-2020] and subsequently by TCCC in 2019.³³⁷ The UK Competition and Markets Authority reviewed and cleared the TCCC–Costa acquisition in 2018.³⁷ At no stage in the documented corporate history does Israeli capital, Israeli incorporation, or Israeli-state sponsorship appear in public records.

Headquarters & Legal Domicile

Costa Limited is legally domiciled and operationally headquartered in the United Kingdom, with its registered address documented at Cherry Court, Dunstable, Bedfordshire (or equivalent TCCC UK subsidiary address).³³⁷ TCCC (parent) is a Delaware-incorporated corporation headquartered in Atlanta, Georgia, USA.² No dual or legacy Israeli headquarters identified.

State & Institutional Linkages

No public evidence identified of any Israeli state ownership stake, government board appointees, government contracts, export promotion arrangements, or designation as critical national infrastructure within the Israeli jurisdiction relating to Costa Coffee. No Israeli government contracts or state-enterprise relationships involving Costa have been identified in public procurement records, corporate filings, or government publications.

Governance Mechanisms

No public evidence identified of golden shares, founder shares, charter restrictions, or other governance mechanisms tying Costa Coffee’s operations or strategic mission to the Israeli state or its policy objectives. Costa’s governance is fully subsumed within TCCC’s standard subsidiary governance architecture.

TCCC Modern Slavery & Supplier Governance Framework

TCCC’s Modern Slavery Statement 2023 and Costa’s Modern Slavery Statements for 2023–24 and 2024–25 address supply chain labour risks at a high level.⁴⁵³⁶ Neither document discloses geographic sourcing specifics at the ingredient or raw-material level with respect to Israel or the occupied territories, nor do they identify any audit findings, supplier remediation actions, or geographic risk designations related to Israeli settlement supply chains.

Profit Repatriation & Economic Contribution

Revenue Attribution

TCCC’s annual 10-K filings report revenues by geographic operating segment (e.g., North America; Europe, Middle East & Africa). Israel-specific revenue from TCCC’s concentrate sales to CBC is not separately disclosed in public filings.²³³ CBC’s own financials are not publicly available, as CBC is a privately held company. Costa Coffee’s revenues are not broken down by any Israeli market segment in any public filing, consistent with the absence of any Costa operating presence in Israel. No public evidence identified of Israel-attributed revenue for Costa Coffee.

Profit Flow Structure

Under the franchise-and-concentrate model, TCCC’s profit from the Israeli market consists of payments received from CBC for concentrate and brand/IP licensing. The 2024 Tel Aviv District Court ruling confirmed that these payments include embedded royalty components for intellectual property and brand use.⁷⁸⁹¹⁰ These flows move from CBC (Israel) to TCCC (Atlanta), not into Israel. Costa Coffee’s global revenues are consolidated into TCCC’s accounts in Atlanta; there is no mechanism by which Costa profits flow into Israel. The inferential chain — that TCCC’s balance sheet, which includes Costa’s contribution, supports TCCC’s capacity to maintain The Bridge programme and its franchise relationship with CBC — is noted but not supported by direct revenue attribution in any public disclosure.²³

Economic Ecosystem Role

No public evidence identified of any government designation, industry report, or economic assessment characterising Costa Coffee as significant within any sector of the Israeli economy, consistent with the absence of Costa operations in Israel. TCCC, by contrast, is documented in Israeli business press and by Who Profits as a significant economic actor in the Israeli soft drinks and food-tech sectors through CBC’s operations and The Bridge programme.⁶¹²⁴¹

Tax Contribution

No public evidence identified of Costa Coffee making corporate tax contributions, VAT payments, or other fiscal transfers within the Israeli jurisdiction. The franchise structure routes TCCC’s Israeli fiscal obligations through CBC, which pays Israeli corporate tax (the subject of the 2024 transfer-pricing dispute). Costa has no identified Israeli fiscal footprint.

Royalty & IP Flows

As a wholly-owned TCCC subsidiary, Costa Coffee’s brand assets and intellectual property are ultimately held within the TCCC corporate family. Intra-group IP licensing arrangements within TCCC are not publicly disclosed at the subsidiary level. No evidence of Costa-branded IP licensing to Israeli entities has been identified. No public evidence identified of Costa IP royalty flows into or out of Israel.

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