It's just a declaration by the seller. VAT is typically paid by the last "buyer" in the chain - if they are all in the EU. So, Robin buys steel from somewhere, and they charge him VAT, but he then sells the knife and charges the buyer VAT. If he paid 10 euros VAT for the steel, and received 100 euros VAT on the sale, he'd actually owe 90 euros to the government net, because he'd get a credit for VAT he's paid. The same thing if he buys lunch for a client, or a new computer, or a new stone for sharpening his knives: he'd pay VAT, but he'd take a credit against VAT he owes the government when charging it from his clients.
If the destination of the product or the service is outside of the country or the EU, then VAT is generally not charged. So if my friend in Colorado buys a knife from Robin, Robin won't charge him VAT, and won't owe the government VAT for that sale. However, there will likely be import duties, usage tax, and such when the blade arrives in the states. Those are not charged by Robin, however, but by the entity handling the arrival in the States.
Those import costs are probably higher than VAT, in most cases. OTOH, if you are shipping one item at a time or few, and you don't declare them as commercial goods, you will likely not be charged. That is generally illegal, however.