UK and Scottish governments agree on the establishment of two "green freeports" in Scotland

Following months of negotiations between the UK and Scottish governments, agreement has now been reached in respect of the establishment of two 'green freeports' in Scotland.  The agreement will see £52m in seed funding invested into the establishment and development of the green freeports in Scotland, in line with the funding commitments offered to freeports across England.  Thus far, the decision appears to have been met with equal optimism and hesitancy within different sections of the Scottish Government, but what is actually meant by the term green freeport?

Green freeports are, in essence, the Scottish equivalent to UK freeports (of which eight have already been confirmed).  Freeports, a major part of the UK government's "levelling up" agenda, are designated free trade zones, where normal tax and tariff rules of the country in which they are based do not apply.  Such zones are designed to boost economic growth, and are intended to be located around docks, airports or railway hubs.

In Scotland, the newly agreed zones will be referred to as green freeports (as opposed to freeports), as a reflection of the Scottish Government's distinctive net-zero emissions targets - targets that will be considered at the very heart of Scotland's adoption of green freeports.  As a result, and amongst other commitments, interested bidders will be required to demonstrate their contribution to a "just transition to net-zero emissions by 2045, delivering net-zero benefits and creating new green jobs".  In addition to the net-zero focus, the Scottish Government's green freeports model also highlights the commitment to Fair Work First principles, and supporting innovation, trade and inclusive growth.   

In terms of when we are likely to see such sites operational in Scotland, it is thought that spring 2023 may be achievable.  The bidding process will commence this spring, and is due to close later in the summer, with bids being jointly assessed by the Scottish and UK governments.