The UK supermarket chain Iceland has reportedly abandoned its decade-long trademark battle with Iceland and instead promised a “rapprochement discount” for shoppers in the country.

After the budget grocery chain suffered its third legal loss last year, its executive chair, Richard Walker, said on Wednesday that it would draw a line under the dispute.

He told the Financial Times that he would take “the couple of hundred of grand we would have spent in legal fees in the fourth and final round in the EU court and reapply that to a rapprochement discount to the good Icelandic people. It’s something I’m going to do.”

The discount is expected to take the form of shopping vouchers that Icelandic people can use at the frozen food retailer.

The government of Iceland first launched legal action against its namesake British grocery chain over the use of its name in 2016. It challenged its exclusive ownership of the European-wide trademark registration for the word Iceland, which it said was preventing the country’s companies from promoting goods and services abroad.

In July last year, the EU general court upheld a ruling cancelling the grocer’s EU trademark registration for the word Iceland. The court reaffirmed that geographical names must remain available for public use.

Walker told the FT: “We lost for a third time. We’re going to throw in the towel. It’s actually fine – we don’t have to change our name.” But he expressed concern that “other people now have the ability to open shops and call it Iceland and stock Iceland products.”

The executive took over the leadership of Iceland in 2023 after his father, Malcolm Walker, stepped down from the frozen foods chain he co-founded in 1970. Richard Walker, previously a supporter of the Conservatives, was recently made a Labour peer by Keir Starmer, and also appointed the government’s cost of living champion a month ago.

The company, based in Deeside in Wales, is privately owned by the entrepreneur Malcolm Walker and its chief executive, Tarsem Dhaliwal, who joined in 1985 as a trainee accountant.

It had a long spell on the London Stock Exchange from 1984 and was renamed The Big Food Group, but returned to family control in 2012 after a £1.45bn management buyout led by Malcolm Walker and the South African investment group Brait. Walker and Dhaliwal bought Brait out in June 2020.

The company grew from a single shop selling frozen food in Oswestry in Shropshire and now has more than 900 stores across the UK, trading under the Iceland and The Food Warehouse names. It also owns Individual Restaurants, whose brands include Piccolino and Restaurant Bar & Grill.

Iceland has been contacted for comment.