That was for establishment of a subsidiary to operate UK-non EU flights.
Aircraft can be based in the other state (with the EU being deemed as a single state for the purpose of that agreement), however why any airline would want to limit an EU-based aircraft to flying only to/from UK unless an emergency arises is beyond me.
If an EU airline that doesn't fly to UK wants to start to do so, it can. It can also base an EU-reg aircraft and crew in the UK, but can only operate from that base to EU countries. This is virtually the same provision as any EU-third country agreement, which allows (for example) Wizz to establish bases in Serbia, Moldova, Ukraine, Georgia etc utilising HA-reg aircraft, but a little more restrictive than allowing a new airline to be set up in one of these countries (Wizz Ukraine for example has operated in the past) unless the effective ownership is with UK/EU dual nationals.