This information sheet summarises the key features of Free Trade Zones in the UK.
This information sheet summarises the key features of Free Zones in the UK.
The factors covered are:
1. Definition of Free Zones
2. UK Free Zones
3. Benefits of Free Zones
4. Placing goods in a Free Zone
5. Activities allowed in a Free Zone
6. Applying to operate a business in a Free Zone
7. Further information
1. DEFINITION OF FREE ZONES
A Free Zone is a designated area in which non-European Union goods are
treated, for the purposes of import duties, as being outside the customs
territory of the European Union (meaning that import duties are not payable
until the goods are released for free circulation).
Customs duty and import VAT are only payable if:
a) the goods leave the Free Zone and are placed into a European Union
b) the goods are used or consumed within the Free Zone.
There are no special reliefs in Free Zones from other taxes, excise duties or
local authority rates. Any supplies of goods and services within the Free Zone
are subject to normal VAT rules.
2. UK FREE ZONES
In the UK there are Free Zones in:
a) England: Liverpool; Port of Sheerness (Kent); Port of Tilbury (Essex);
b) Scotland: Prestwick Airport.
Please see Appendix A for full contact details of all UK Free Zones.
The key UK Government organisation responsible for Free Zones in the UK is
HM Revenue & Customs. For further information, please see:
www.hmrc.gov.uk/ or telephone 0845 010 9000 (for callers within the UK) or
+44 2920 501 261 (for callers from overseas).
3. BENEFITS OF FREE ZONES
In addition to the relief that is available throughout the UK on customs duties
relating to the transhipment, handling and processing of goods destined for re-
export, companies operating in Free Zones also receive the following benefits:
a) simplified customs procedures,
b) cash-flow benefits resulting from exemption of duty until the goods are
exported or released into free circulation,
c) additional security from the perimeter fence enclosing the Free Zone,
d) greater flexibility in determining the final destinations of goods (subject
to any quota restrictions).
4. PLACING GOODS IN A FREE ZONE
Goods that may be placed in a Free Zone include:
a) non-European Union goods,
b) European Union goods, and
c) goods in free circulation which are still under customs control (because,
for example, certain charges have not been paid, or proof of their arrival
or particular use is required).
5. ACTIVITIES ALLOWED IN A FREE ZONE
The following activities may take place in a Free Zone:
a) ?Storage?. Goods accepted as ?Free Zone goods? by the Free Zone
Manager may be stored in the Free Zone for an unlimited time (specific
time limits may, however, apply to certain Common Agricultural Policy
b) ?Usual forms of handling?. Simple activities may be carried out on the
? preserve them in good condition,
? improve their presentation or marketable quality, or
? prepare them for distribution or resale.
c) ?Processing goods?. This includes any operation that changes the
condition of the goods (such as manufacturing or assembly).
6. APPLYING TO OPERATE A BUSINESS IN A FREE ZONE
To run a business in a Free Zone, an operator needs prior authorisation from
HM Revenue & Customs.
To apply for authorisation, an operator should write to the appropriate HM
Revenue & Customs office responsible for the Free Zone (see Appendix A) with
the following information:
a) the nature of the activity that is planned,
b) a supporting letter from the Free Zone manager,
c) the name, address and VAT number of the company, including the
correct legal entity,
d) the full names of the directors or partners of the company,
e) details of any associated businesses,
f) identity and details of any building in the Free Zone that will be used,
g) a description of the goods involved,
h) the origin of the goods and their customs status,
i) details of any handling or processing to be carried out,
j) methods of declaring goods to the Free Zone and removal from the Free
k) details of the stock records to be maintained, including any computer
l) any other relevant information that is needed to ensure proper
application of the arrangements.
If the application is accepted, the operator will receive a letter of authorisation
If goods are to be placed in the premises of an operator who is already
authorised, the owner of the goods does not need to apply for a separate
authorisation and goods can be entered into the Free Zone under the existing
7. FURTHER INFORMATION
This information sheet was updated in March 2010.
As information changes from time to time, please contact the organisations
listed or UK Trade & Investment to confirm any item that you intend to rely on.
This information sheet was produced by the Marketing Group of:
UK Trade & Investment
66-74 Victoria Street
Tel: +44 (0)20 7215 4957
APPENDIX A - UK Free Zones
Free Zone Name and Free Zone Manager Supervising Customs
Code Contact Office
Liverpool Liverpool Freeport Leeds MTR/TP Team
Maritime Centre Peter Bennett House
Port of Liverpool Redvers Close
L21 1LA West Park Ring Road
Leeds LS16 6RQ
Tel: +44 (0)151 949 6017 Tel: +44 (0)113 389 4426
Fax: +44 (0)151 949 6020 Fax +44 (0)113 389 4373
Prestwick Airport Freeport Scotland Ltd Dundee EICS
Ayr Caledonian House
KA8 9SL Greenmarket
Dundee DD1 1HD
Tel: +44 (0)1292 316347 Tel: +44 (0)1382 313317
Fax: +44 (0)1292 618678 Fax: +44 (0)1382 313332
Port of Sheerness Medway Ports Ltd Anchorage House
Sheerness Docks High Street
Kent ME12 1RX Chatham
Tel: +44 (0)1795 596596 Tel: +44 (0)1634 830933
Fax: +44 (0)1795 668516
Fax: +44 (0) 1634 887043
Southampton Free Southampton Free Trade Compass House
Zone Ltd Romsey Road
Southampton Southampton SO16 4HP
Tel: +44 (0)23 8077 2200 Tel: +44 (0)23 8079 7000
Fax: +44 (0)23 8078 1111 Fax: +44 (0)23 8079 7724
Port of Tilbury Free Port of Tilbury London Ltd Custom House
Tilbury Dock, Tilbury Tilbury Dock, Tilbury
Essex RM18 7EH Essex RM18 7EJ
Tel: +44 (0)1375 852300 Tel: +44 (0)1375 844121
Fax: +44 (0)1375 855106 Fax: +44 (0)1375 853207
Source: HMRC, 2010