Need to Know: Planning changes in pipeline to support freeport status

Why is the government proposing to set up freeports in the UK and what changes to planning rules are envisaged to help them function effectively? By Robbie Owen.

Teesport (Pic: Steve Walker, Flikcr)
Teesport (Pic: Steve Walker, Flikcr)

Q What are freeports?

A There is no fixed definition, as exact arrangements differ between countries. Freeports are often situated in or close to seaports, river ports and airports. Generically, freeports are designated secure areas inside a country but outside its established customs area, in which different customs and sometimes other rules apply. This allows components and goods to be imported, manufactured and exported without being subject to the host country’s standard tariffs and export-import procedures. In the UK, the Treasury can designate special areas for customs purposes known as “free zones”. Seven operated between 1984 and 2012, including in Liverpool, Southampton, Tilbury, Sheerness and Prestwick Airport.

Q What do we know about the government’s plans for more?

A As a backbench MP, current Chancellor Rishi Sunak argued in a 2016 Centre for Policy Studies report that the UK should take advantage of the “new economic freedom” resulting from Brexit to create freeports based on the American model. The report estimated that UK freeports could create up to 86,000 jobs. Establishment of up to ten UK freeports was a key policy in the Conservatives’ election manifesto. The government is currently consulting on a detailed proposal centred around a customs model for rail, sea and airports but with suggested tax incentives and planning simplification, in effect setting up special economic zones. Freeports are seen as a cornerstone of the levelling-up agenda with the objectives of being “national hubs for global trade and investment”, promoting “regeneration and job creation” in areas of high deprivation and creating “hotbeds for innovation”.

Q What planning changes is the government considering?

A The government has suggested aligning permitted development rights (PDRs) for seaports with those applying to airports and railway undertakings, by extending the purposes for which PDRs are available. It is also inviting views on whether any further PDRs should be established to support freeports’ operation. In addition, the Government wants to encourage the use of zonal planning via Local Development Orders (LDOs), now operating in more than 100 such areas in the UK. They include the Hull Enterprise Zone, which encompasses the local port. On seaport capacity, the consultation paper says the government will consider reviewing the existing ports national policy statement. It may also consider whether the maritime sector needs further support in line with Maritime 2050, the government’s long-term strategy for the sector.

Q What implications might new freeports have for planners?

A The PDR changes suggested would reduce the number of planning applications required for seaport development. But as they cannot authorise development requiring environmental impact assessment unless an appropriate screening opinion has been given, inappropriate development would still be controlled. LDOs have been used to advance the notion of port development zones, for example at DP World London Gateway. Some would like to see more use by councils to reduce the number of planning applications required for seaport development.

Q Where and how would new freeports be established?

A Teesport, Hull, Grimsby and Immingham, London Gateway, the Port of Tyne, Milford Haven and East Midlands Airport have each been mentioned as possible candidates. The designation programme will be led by the Ministry of Housing, Communities and Local Government, working closely with the devolved administrations. The government wants a fair, robust and transparent allocation process and has said applications will be invited through a competitive bidding process. The forthcoming planning white paper will provide clues as to next steps.

Robbie Owen is head of infrastructure planning and government affairs at Pinsent Masons


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