Heathrow and East Midlands apply for UK Freeport status

Heathrow Airport and an East Midlands consortium have applied for Freeport status in the UK.

The government closed the application period for Freeport status on Friday, with 30 bidders thought to have submitted proposals.

Companies using Freeports will be able to import goods without paying tariffs, process them into a final good and then either pay a tariff on goods sold into the domestic market, or export the final goods without paying UK tariffs.

Areas given Freeport status will also benefit from a wide package of tax reliefs, including on purchasing land, constructing or renovating buildings, investing in new plant and machinery assets and on Employer National Insurance Contributions.

In total, the government intends to create 10 Freeports. The scheme comes following the country’s exit from the European Union and as the government looks to create new trade links.

The East Midlands bid for Freeport status was submitted by a consortium led by the two local enterprise partnerships, including East Midlands Airport.

The proposition is based around the East Midlands Airport Gateway Industrial Cluster as well as two other industrial sites in the region.

Clare James, East Midlands Airport’s managing director, said: “We’re delighted to be part of a regional Freeport bid that, if successful, could create thousands of jobs for local people. East Midlands Airport (EMA) is a key regional and national gateway for Britain’s exports and imports.

“Assets like EMA will have a key role to play in helping the Government fulfil its ambition of a ‘global Britain’ especially as the country strikes trade deals around the world. As the port of entry and exit, we bring to the Freeport bid, along with our road haulage and rail operating partners, the connectivity that is one of this region’s unique strengths.”

Heathrow Airport said Freeport status will allow businesses, customers and supply chains to capitalise on international connections and routes, whilst reducing administrative burdens and controls.

It points out that in 2019 34% of UK cargo by value came through the airport and that 75% of all the country’s long-haul connections are from the airport.

“Our vision is that the UK – and its businesses – should be as well connected to cities in India and China as it is today with the US – with multiple, daily, year-round flights to a long list of cities across these countries complementing a wide range of other global routes,” said Nigel Milton, director of communications, Heathrow Airport, in a letter to government to support its application, supported by several business groups.

“This vision is delivered by utilising our unique long-haul network, supported by guaranteed domestic connections into Heathrow from regional airports and all aligned with potential Freeport sites in Teesside, Belfast, Inverness, and Newquay. A joined-up approach would allow the whole of the UK to connect direct to global growth opportunities and help deliver on the Government’s commitment to levelling up the UK.”

He added: “Heathrow believes it has a key role to play in both the development and implementation of the UK’s Freeport policy, and the economic recovery that this policy will be vital in supporting.

“An Associated Freeport at Heathrow provides an opportunity to accelerate the recovery and support regions around the UK, and boost industries and businesses across our local communities that have been negatively impacted by the pandemic. Just as manufacturing and high-tech clusters have been developed around Heathrow in West London and the South East, our position as a connecting port enables the specialisms from other sites around the UK to reach opportunities throughout the world.”