Dutch meat wholesaler Willy Selten was arrested on Thursday for allegedly selling 300 tonnes of horsemeat labelled as beef, the public prosecutor said.
The prosecutor's office said that Dutch food safety authority NVWA arrested the man, whom media identified as Selten, allegedly a key player in Europe's horsemeat scandal, as part of "a criminal investigation into labelling horsemeat as beef."
"The director and the interim director have been arrested," a statement said. "They are suspected of false accounting and fraud."
The statement said the man's company was the same as the one searched as part of an initial probe when Europe's adulterated beef scandal erupted in February.
Dutch media reported that the man referred to as the director was Selten.
Selten in April failed to quash an order recalling 50,000 tonnes of potentially contaminated horsemeat that had passed through his plant in the southern Dutch city of Oss.
The NVWA asked hundreds of companies across Europe supplied by Selten to check their products.
Selten's company was last month also declared bankrupt and placed under curatorship.
"The business allegedly received 300 tonnes of horsemeat from the Netherlands, England and Ireland in 2011 and 2012," the prosecutor said on Thursday.
An investigation showed that this horsemeat was processed as beef according to the company's accounts, which said that the business only sold beef, the statement said.
The accounts did not say from where the meat came or to where it went. A third person from the company was interviewed in connection with the alleged fraud on Tuesday and Wednesday, the prosecutor said.
Selten's meat processing plant handled imports from various European countries and delivered to retailers, meat wholesalers, butchers, the meat processing industry and supermarkets throughout Europe.
Since the horsemeat scandal erupted in Ireland in January, governments have scrambled to figure out how and where the mislabelling of meat happened in the sprawling chain of production spanning abattoirs and meat suppliers across Europe.
The scandal prompted the European Commission to order tests of food across the European Union which showed that almost one in 20 meals marketed as beef was likely to be tainted with horse.
Though the scare first erupted in Ireland and Britain, there was no trace of horse-tainted products in either country, with the highest number found in France, Greece, Latvia and Denmark in that order.
The scandal led to meatballs in Ikea stores, sausages in Russia and frozen burgers in Britain's Tesco chain being pulled from shelves by the millions.
Brussels has suggested tighter controls along the food chain as well as stiffer sanctions against food fraud.