The EU clamps down on free ports over crimes and terrorism links
Brussels is clamping down on 82 free ports or free zones after identifying that their special tariff and duty status has aided the financing of terrorism, money laundering and organised crime.
A set of new rules was introduced by the European commission just weeks before the launch on Monday of a UK government consultation on the creation of up to 10 free ports in post-Brexit Britain.
Authorities across the EU have been obliged since 10 January to take extra measures to identify and report suspicious activities at the ports and zones as a result of the “high incidence of corruption, tax evasion, criminal activity”.
The EU’s executive branch has said it will review the issue again next year owing to the popularity of such ports among high-net-worth individuals and criminal organisations seeking to circumvent recent crackdowns on bank secrecy.
Free ports or free zones are a type of special economic zone (SEZ) where business and trade laws differ from those in the rest of the country. Goods can be landed, stored, handled, manufactured or reconfigured and re-exported without being subject to customs duty.
Rishi Sunak, the chief secretary to the UK Treasury, inaccurately claimed on Monday that “the EU is pretty much the only place in the world that doesn’t use free ports”. In reality, the EU’s customs code does allow for free ports or zones and there are 82 of them across the countries that are subject to its regulations.
The Isle of Man, a British crown dependency that is neither part of the EU nor the UK, operates a free port. The British government has said it wants the first to be opened in the UK by 2021.
In July, the commission said free ports, popular for the storage of art, precious stones, antiques, gold and wine as alternative assets to cash, posed an emerging threat in multiple ways.
Source: Risk Screen