- Port of Nigg becomes first site in the green freeport to be awarded customs site status by HMRC
- Designation incentivises the offshore wind sector and wider energy industry to move heavy engineering through the port
- Status supports the green freeport’s ambition to position the region at the heart of the drive to net zero and create a legacy for the Scottish Highlands
Inverness and Cromarty Firth Green Freeport (ICFGF) has achieved another significant development milestone with the awarding of customs site status to Port of Nigg – a move that will solidify the north of Scotland’s position as a world-leading hub for the renewables sector.
The designation – granted by HMRC after a stringent audit and verification process – provides incentives that will pave the way for greater volumes of heavy engineering components such as offshore wind foundations, manufactured HV/DC cables, wind turbine generator components and fabricated steel structures to pass through the port.
A customs site is a designated area within the green freeport that sits outside the UK’s normal customs rules. It benefits from simplified processes and reduced costs associated with handling goods to and from the area, making it more attractive to current users and those looking to invest.
ICFGF needed to have at least one operational customs site to enable the Scottish and UK governments to approve its full business case. That final phase in the administrative process is now expected to happen within a matter of weeks.
Port of Nigg on the Cromarty Firth, operated by Global Energy Group, which is one of the green freeport’s founding partners, was selected as the first candidate to apply for the status due to its existing and well-established processes for security and cargo handling.
Along with the designation of special tax sites that provide incentives to businesses in the green freeport, the custom site status was a critical factor in attracting Sumitomo Electric Ltd to Port of Nigg. The company is currently constructing a £350m subsea cable manufacturing plant there that will create more than 150 highly skilled local jobs.
ICFGF represents a transformational opportunity for the Highlands of Scotland to become an internationally recognised hub for offshore wind and renewable energies. It is poised to deliver more than 10,000 new jobs, over £3bn of inward investment and create a legacy for future generations.
Calum MacPherson, Chief Executive of ICFGF, welcomed the custom site designation and thanked Port of Nigg for driving it forward. The port was required to show that it could meet stringent criteria as an operator, including on site audits conducted by HMRC to review security measures, inventory control processes and operating procedures. These criteria will be regularly reviewed by HMRC.
Mr MacPherson added, “The work and lessons learned will benefit other organisations within the green freeport that want to become customs sites. Port of Nigg has demonstrated the exceptionally high standards organisations will need to meet to operate these HMRC regulated zones.
“Our ports do not handle small consumer goods so we will not see, for example, transit of large volumes of food and drink. Where our ports excel is in the handling of heavy engineering components for the energy sector, and this status significantly raises our potential as a major European hub for offshore wind and renewable energy technologies.
“We’re operating in a global market, but the green freeport levers are enabling the Highlands to compete and – as we’ve seen from the significant inward investment already secured – win on the international stage.”
Rory Gunn, Facilities Director at Port of Nigg, said, “As a large and established hub facility within the energy industry, the customs site status will further enhance our competitiveness, especially in the offshore renewables sector. It will enable us to attract new opportunities and provide benefits to our existing and future clients.
“In the future, we hope that more components for the energy industry will be manufactured and moved through the port and make use of the customs site benefits. The HV/DC cables which will be manufactured at the new Sumitomo Electric factory are a good example of new products that will be loaded in and out of the port.
“The designation is a critical component of the green freeport and is a key driver of inward investment and growth. The customs site status, coupled with the tax site benefits, will make the Port of Nigg a very attractive place for investment and businesses to locate, which in turn creates local jobs and opportunities.”
Businesses using the customs site benefit from duty suspension of imported goods providing they are not imported into the wider UK after leaving the port. Additionally, there are no export duties on products going into use in British waters outside a 12-mile territorial limit or to countries overseas.
It is also possible to store equipment and cargo at the port for long durations without incurring duties, and businesses can use a simplified administrative procedure for documenting the import and export of goods.