To operate a Freeport customs site (also known as a ‘free zone’) you must meet the conditions of a ‘designation order’. The designation order sets out who the Freeport customs site operator is and the conditions they must comply with.
If you want to operate a Freeport customs site, you’ll need to show HMRC that you can comply with the conditions of Freeport customs site designation and safety and security standards. You can do this by applying to HMRC.
Complying with the conditions
The conditions of the designation order you must comply with may include:
- making sure that the site is enclosed, and that entry and exit is only allowed at identified points
- providing facilities where records relating to the Freeport customs site can be examined, either in person or remotely accessed
- complying with the electronic record keeping requirements
- providing information to authorised officials
- providing and maintaining in good order and free of charge, the necessary facilities for authorised officials including land and premises for the examination or search of goods
- making sure that no one operates on the site if the:
- appropriate notification has not been given
- activity is banned
- activity would breach a restriction imposed by HMRC
- making sure health and safety requirements imposed by a competent authority are met and that working conditions for authorised officials are safe
- making sure that any goods listed by HMRC as prohibited from a Freeport customs site are not kept in the Freeport customs site
- getting HMRC permission before the construction of new buildings in the site and making sure that any conditions of approval are followed
- telling HMRC of any:
- breaches of customs rules by anyone on site or connected to the Freeport customs site
- material changes affecting your role as a site operator
- failure to satisfy any requirements in the designation order, or your operator’s authorisation
- refusing permission of any movement of goods out of the Freeport customs site other than in circumstances permitted by the Freeport customs site legislation
- complying with instructions given under Freeports legislation by an authorised officer
Businesses carrying out activities in your Freeport customs site
You’ll need to notify HMRC of businesses that plan to carry out any industrial, commercial or service activity in your Freeport customs site, before the activity has taken place.
What security you’ll be responsible for
You need to have procedures in place to protect your business and the supply chain from any risks. You’ll need to make sure your procedures are robust and appropriate to the size and nature of your business. For example, a small business with a secure outer fence and intercom may not need full time security staff.
You need to have evidence that you:
- have a safety and security risk assessment in place
- have secured external boundaries with documented procedures to control access to your premises
- have measures in place to inspect and protect your cargo units
- prevent unauthorised access to shipping areas, loading docks and cargo areas
- agree appropriate safety and security measures with your suppliers
- carry out security screening and procedures for prospective employees and contracted parties
- train your staff in the safety and security requirements
- have contracts for temporary personnel
- have details of who owns cargo units on your site
- have site and personnel security requirements in all outsourcing contracts (including cleaning, security, maintenance and any others)
- regularly check and review your processes and keep records of this
You can also keep evidence that you have a safety and security certificate from one of the following:
- an international convention
- an international standard of the International Organisation for Standardisation
You should have a strong recruitment policy that stands up to scrutiny.
You should have pre-employment checks in place for all staff. This should cover the previous 3 years at least. You’ll need to have evidence of this.
An agent or known consignor should have a 5 year employment history check.
If an employee is in a security sensitive position or a high risk area, they must have received security screening. The same level of background checks apply to agency workers you or your subcontractors employ.
Records you’ll need to keep
You must keep records for 5 years to comply with electronic record keeping requirements. You must be able to provide these records on request to HMRC or Border Force officers.
Goods arriving at your Freeport customs site
For each consignment you’ll need to keep the following:
- air waybill number or shipping number
- the customs procedure the goods have been placed under
- the date and details of any customs formalities
- details of any electronic import or export declarations –
the date and time the goods arrived at the business in the site - unique commercial identification references
- number and kind of packages
- the quantity and usual commercial or technical description of the goods
- the identification marks of the container to identify the goods and weights (gross and net)
- registration number of vehicles carrying goods to the Freeport customs site
- the details of the business in the Freeport customs site where goods have been received
The person receiving the goods must notify you that the goods have arrived, where they are:
- brought into a Freeport customs site to be declared by conduct to the Freeport customs special procedure
- under the Freeport customs special procedure that have been transferred to another business in the same Freeport customs site
Your records will need to show that this notification has taken place, and you will need to keep a copy of the information sent in that notification, and the time and date that it was received.
Goods leaving your Freeport customs site
You must not allow goods to leave your Freeport customs site unless you have been provided with a notification and evidence to show that the goods meet the following conditions:
- they have been declared to:
- inward processing
- authorised use
- transit
- temporary admission
- customs warehousing and moved to a place outside of the Freeport customs site (where it’s covered by the customs special procedure authorisation)
- they have been declared to the Freeport customs special procedure but are to be moved directly to:
- a place from where they are exported
- a customs office for the purposes of discharging the Freeport customs special procedure
- a location in Northern Ireland
- an authorised business in another Freeport customs site
- they are domestic (including where HMRC has accepted a declaration to say the goods have moved into free circulation even if the goods are in the Freeport customs site)
- they can be removed in accordance with an authorisation by HMRC and will be moved in accordance with that authorisation
The evidence can include:
- an original (or faxed copy) of an authenticated removal note, which will be one of the following:
- a C130
- a system generated release note/or message
- release by another, approved electronic message format (for example SMS text message)
- relevant customs paperwork (including things like proof of cleared declarations and customs special procedure authorisations)
- relevant commercial documentation that cover:
- the destination of the goods
- the reason for moving the goods outside the Freeport customs site
The notification must be made by a business who is authorised to operate in a Freeport customs site, or someone acting on behalf of them.
Your records will need to include the:
- notification and evidence provided to you
- time and date of the notification
- details of the business it relates to
If someone is dealing with customs for them, you must include their details in your records as well.
