This order designates Customs Site No. 7 in Liverpool as a free zone for a 10-year period, appointing John K Philips Group Limited as the responsible authority.
The order details specific conditions the responsible authority must meet, including maintaining detailed records, providing access for HMRC officers, ensuring safe working conditions, and taking measures to prevent unauthorized activities within the free zone.
The authority is subject to comprehensive reporting and inspection provisions.
Failure to meet any condition may result in revocation of the designation.
Arguments For
Economic benefits: Establishing free zones can stimulate economic activity within the designated area by reducing customs burdens and attracting businesses.
Increased investment and job creation: The reduced regulatory burden can incentivize investment and the creation of new jobs in the port region.
Enhanced international competitiveness: Free zones create a more attractive environment to conduct business with simplified import and export processes, potentially improving a port's position in global trade.
Improved trade facilitation: Streamlining customs procedures facilitates the movement of goods and boosts the overall efficiency of supply chains, improving trade flow in and out of Liverpool port.
Legal Basis: The Order is made under the authority of section 100A of the Customs and Excise Management Act 1979, providing a firm foundation in existing legislation.
Arguments Against
Potential for revenue loss: Reduced customs duties within a free zone could result in significant revenue losses for the UK government.
Regulatory challenges: Maintaining the integrity of the free zone's customs control system could be complex and requires robust monitoring and enforcement.
Risk of smuggling and illegal activity: The relaxed customs procedures potentially increase the risk of smuggling and other illicit activities unless properly managed.
Administrative burden: The designated authority faces a significant administrative burden, in record keeping and reporting requirements.
Unintended consequences: Relaxing customs regulations, may have unanticipated effects on related industries or the broader economy.
- Citation and interpretation (1) This Order may be cited as the Free Zone (Customs Site No. 7 Liverpool) Designation Order 2025. (2) In this Order— (a) a reference to an area “shown edged and hatched in red” on a map is a reference to the hatched area extending up to the red edging, but not including the red edging itself; (b) “customs obligation” has the same meaning as given in regulation 2(1) of the Customs (Import Duty) (EU Exit) Regulations 2018; (c) “HMRC” means His Majesty’s Revenue and Customs; (d) “HMRC officer” means an officer of Revenue and Customs; (e) “the Special Procedures Regulations” means the Customs (Special Procedures and Outward Processing) (EU Exit) Regulations 2018; (f) “unauthorised activity” means an activity specified in regulation 3(2)(b)(v) or 3(2)(c) (authorisation requirement) of the Special Procedures Regulations that is not carried out in accordance with an authorisation or approval under those Regulations.
This section clarifies the order's title and defines key terms.
It establishes that references to areas on a map encompass the hatched area up to, but not including, the red edging.
Key terms such as "customs obligation," "HMRC," and "unauthorised activity" are defined using existing legislation.
Specific regulations are referenced for precise meaning.
This ensures clarity and consistency in interpreting the order's provisions.
- Period of effect of Order This Order has effect for a period of 10 years beginning with the day after the date on which it is made.
The order's effective period is 10 years, starting the day after its enactment.
This sets a clear timeframe for the free zone designation.
- Designation of area as free zone The area shown edged and hatched in red on the map entitled “Liverpool Freeport Customs Site 7 - 12 Feb 25” dated 12th February 2025 is designated as a free zone.
This section designates a specific area, identified on a referenced map, as a free zone.
The map provides the geographical boundaries of the designated area.
- Appointment of responsible authority The responsible authority for the free zone is John K Philips Group Limited, incorporated on 4th February 2000 with the company number 03919757, whose registered office is Solar 120 110 Europa Boulevard, Westbrook, Warrington, Cheshire, England, WA5 7TN.
John K Philips Group Limited is appointed as the responsible authority for the free zone.
The company's incorporation details and registered office address are provided for identification.
- Conditions imposed on responsible authority The responsible authority must— (a) keep separate accounts in respect of its role as responsible authority for the free zone; (b) maintain a system for the keeping, preserving or updating of records required to be kept, preserved or updated by the responsible authority in accordance with regulation 44 (record keeping) of the Special Procedures Regulations; (c) make any records for which the responsible authority is responsible, relating to the free zone and the activities carried on in it, available for inspection, access (including electronic) and copying for removal by an HMRC officer, at an office in the free zone or other agreed place; (d) provide to any person authorised by the Treasury such information in connection with the free zone and the operation of it (which may include copies of the records referred to in paragraphs (b) and (c)) as that person may reasonably require; (e) ensure that the area referred to in article 3 is enclosed and that entry and exit is permitted only at the points marked as access points on the map; (f) provide, free of expense to the Crown, such accommodation and facilities including furniture, fittings and equipment as the Commissioners may reasonably require, which must be properly maintained, heated, lighted, ventilated and kept clean by the responsible authority; (g) provide, free of expense to the Crown, such area of land within the free zone as the Commissioners may reasonably require for the examination of goods and vehicles; (h) provide and maintain, free of expense to the Crown, any appliances and other facilities which the Commissioners may reasonably require to enable an account to be taken of any goods or make any examination or search; (i) comply with any requirement imposed by an HMRC officer under regulation 18E(9) (control of other activities in free zones by responsible authorities) of the Special Procedures Regulations; (j) take reasonable steps to ensure that no unauthorised activity is carried out in the free zone; (k) take reasonable steps to ensure that any goods specified in a notice made under regulation 18C(2) (free zone businesses - conditions) of the Special Procedures Regulations are not brought into the free zone; (l) take reasonable steps to ensure that no goods leave the free zone otherwise than in circumstances where their removal would be in accordance with provision made by or under the Taxation (Cross-border) Trade Act 2018; (m) take reasonable steps to ensure that persons carrying out any activities in the free zone comply with any customs obligations related to the free zone; (n) notify HMRC as soon as reasonably practicable— (i) of any breach of a customs obligation by any person in relation to any goods that are or have been in the free zone, or have been declared for a free zone procedure under the Special Procedures Regulations, that it becomes aware of; (ii) if it fails to comply with any condition or restriction to which its appointment as responsible authority is subject; (iii) if there is a change in circumstances that is relevant to its appointment as a responsible authority; (o) notify HMRC of any planned construction in the free zone.
This section outlines numerous conditions placed upon the appointed responsible authority.
These conditions cover accounting practices, record keeping, access to information by HMRC, facility provision, security measures, and preventing unauthorized activity.
Compliance with these detailed conditions is crucial for maintaining the free zone's regulatory integrity and preventing potential abuses.
- Conditions relating to health and safety Without prejudice to the responsibilities of persons occupying premises within the free zone, the responsible authority must take reasonable steps to ensure that the accommodation, facilities and working conditions within the free zone are safe and without risk to the health and safety of any persons in the free zone.
The responsible authority must ensure health and safety within the free zone, safeguarding the well-being of all persons present.
This condition underlines the importance of workplace safety alongside customs regulations.