The Ethical Shellfish Company, founded by Guy Grieve and his then wife Juliet Knight 12 years ago, was known for its hand-dived scallops which were delivered to top chefs throughout the UK, as well as private customers, after being sourced on the west coast of Scotland.

Last week, Grieve confirmed on social media that his company would be shutting down, writing: “The family farm is closing down. God knows we tried. Mother Atlantic kept us going for years. My sons characters were defined by the experience as was mine & that of my beloved former wife Juliet. Many lives to lead before we die. #Scotland.”

On Tuesday, the firm released a full-length statement setting out exactly why it has closed its doors.

While the Covid pandemic was chosen as the top reason for the firm closing down, Brexit was the second-biggest factor.

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Grieve explained that the pandemic’s impact on the restaurant industry in turn had a major affect on the Ethical Shipping Company, resulting in the firm having to sell its boats.

While this was survivable, the company was then reliant on sourcing produce from small dive boats along the west coast – but many of these were reliant on European staff who left Scotland during the pandemic and didn’t come back following Brexit.

“This left drastic crew shortages which in the end caused our main supplier to quit fishing altogether and leave Scotland,” Grieve explained. “It also made it even more difficult to staff our small operation on Mull.”

According to the firm’s founder, the “explosive growth of holiday accommodation” on Mull then made it difficult to find local workers as homes in the area lay empty for many months.

“It felt like the final insult when in the end we were asked to leave our business premises so that it could be turned into - you guessed it - yet another holiday home,” Grieve added.

Other challenges faced by the shellfish firm includes new health and safety regulations making it “harder to set up as a dive fisherman”, and climate change leading to a decline of shellfish stocks, stronger winds making fishing harder.

Grieve added that it was “depressing” to have seen little progress on marine environmental protection since the company was founded in 2010.

However, he confirmed that the team would be moving on to further environmental issues and will “keep up the good fight”.

James Withers, the CEO of Scotland Food & Drink, was unsurprised by the factors leading to the Ethical Shellfish Company’s closure.

“The usual two nightmares are there: Covid & Brexit,” he said. “But the story’s more complex than just that. Scotland’s food sector has transformed. But, we’ve a way to go yet.”

Mountaineer Cameron McNeish added that he hopes the Scottish Government addresses the second homes issue causing problems for businesses in the Highlands and Islands.

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“This is well worth reading as an indicator of how difficult it is to run a business in the Highlands and Islands,” he tweeted. “I hope the @scotgov takes note, especially in the very depressing area of second homes, a curse which is destroying communities.”

Other businesses, including the Ullapool Bookshop, stood in solidarity with the shellfish company.

“It's a humbling read Guy and sadly one which will resonate with so many businesses, both now and those which have gone before. All the best for the future in your next chapter.”

The news came a day after it emerged that Brexit is also causing problems for the Falkland Islands’ fishing sector.

Derek Twigg, chairman of the Falkland Islands All-Party Parliamentary Group (APPG), said there had “been a lot of concern” over the impact of the UK’s exit from the EU on Falkland Islands fishing exports, such as squid.

Speaking as parliamentarians marked 40 years since the Falklands War, the MP for Halton said: “Brexit has brought problems for the islands in terms of the fisheries, because their fishery… is a very much large part of their economy, particularly squid, particularly the type of squid they have which is exported to Europe.

“Work is going on with the Falklands government and countries like Spain and the EU to try and ease those challenges around that because it’s such a big exporter.”

His comments were echoed by Falkland Islands government representative to the United Kingdom and Europe Richard Hyslop, who said: “When it comes to Brexit, as things stand, there are no obvious benefits to the Falkland Islands. There are however a number of challenges.”

Hyslop said the EU is the main market for the Falkland Islands’ fishery exports, with exports accounting for “more than 50% of our GDP”, and “was an important market for meat exports”.

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However since the end of the transition period in January 2021 the Falkland Islands’ exports to the EU have been subject to tariffs, he added, with an average of 42% for meat and between 6% and 18% for fisheries exports.

The “very high tariff” on meat exports has “resulted in the loss of the market as it is just not viable to export to the EU any more” while exports of fishery products to the EU are “now less profitable”.

Hyslop said the Falkland Islands government was “exploring a wide range of options” looking at “how we have these tariffs removed”.