The Government has this week announced its final approval for Freeport East alongside up to £25 million of seed capital funding to commence the project.

Freeport East consists of a 45km diameter zone around the Ports of Felixstowe and Harwich International. Alongside the two ports themselves, Gateway 14 near Stowmarket is a significant development site identified as part of Freeport East. Within the Freeport East zone, the Freeport rules shall apply.

What are the Freeport rules for Freeport East?

1. Tax

i) Business Rates Relief

For new businesses located within the zone and certain existing businesses where they expand until 30th September 2026 for five years.

ii) SDLT Relief until 30th September 2026

iii) Enhanced Structures and Buildings Tax Relief

For construction and renovations of non-residential structures and buildings at a rate of 10% (compared to 3% nationally) until 30th September 2026.

iv) National Insurance Contributions

Employer relief at zero rate on earnings for all new hires up to £25,000 per annum for 36 months for each employee, provided that employee spend 60% or more of their time within the zone. This is anticipated to be available until April 2031, subject to an agreed extension from April 2026.

v) Enhanced Capital Allowance Tax Relief

This will be a 100% enhanced capital allowances for companies within the zone and that invest in qualifying assets, available until 30th September 2026.

2. Customs

Businesses operating within the zone can store and manufacture imported goods, then export them and not pay the full tariff.

There will also be a simplified customs procedure through the combined Freeport East Customs Procedure. There are four customs sites in Freeport East: PD Ports, Port One Logistics Park, Uniserve and Horsley Cross.

3. Planning

The Freeport zone will have a streamlined planning process through local development orders and development consent orders, which allow wide planning consent for identified areas for specific development.

An application is to be submitted shortly for the development of the Harwich section of Freeport East. This follows the consent granted for Felixstowe and the planning application for Gateway 14.

Felixstowe and Harwich are, together, already the largest container ports in the UK and account for 60% of all the UK’s trade with Asia. Freeport East is anticipated to generate a further £500 million of investment into the local economy within 5 years, alongside 13,500 regional jobs and a £5.5 billion economic boost over 10 years.

At Ellisons, we can offer comprehensive range of services to businesses and individuals across the UK and beyond – aided by our membership of the Alliott Global Alliance, a worldwide alliance of professional firms. We will continue to monitor developments regarding Freeport East to ensure our new and existing clients and contacts are well placed to take advantage of the opportunities this brings.