I think it is this?
https://www.gov.uk/hmrc-internal-manuals/customs-special-procedures/spe14030
Calculation of duties: goods repaired or replaced free of charge
No duty is due on authorised OP (Outward Processing) goods which have been
repaired, or replaced, free of charge under a contractual or statutory
obligation arising from a guarantee.
Documentary evidence that the repair was free of charge, such as a warranty
or other contractual documents, must be produced with the import entry.
As you say VAT is still due on replacements - which I found on this page:
https://www.gov.uk/guidance/using-outward-processing-to-process-or-repair-your-goods