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Unviable statutory ports and harbours

Traffic lights iStock 000003944828XSmall 146 x 219Lara Moore examines the difficulties for councils in running unviable statutory ports and harbours and a recent Department for Transport consultation on harbour closure orders.

Statutory Harbour Authorities (SHAs) are responsible for running most operational ports and harbours in the UK. Their powers are derived under a mixture of national and local legislation. Their duties typically include keeping the port or harbour open for the shipping and unshipping of goods and passengers, environmental protection and navigational safety. One of the three main types of SHAs in the UK are statutory ports and harbours run by councils. These are known as 'municipal ports'. Whilst some municipal ports are profitable, others (as highlighted by the Municipal Ports Review) struggle to run efficiently and economically.

SHAs raise the money required for them to comply with their statutory duties by charging harbour and port users 'harbour dues'. If the number of harbour users at a port or harbour is low, it may be difficult for the SHA to raise sufficient funds to comply with its statutory duties. However, most harbours and ports are required by law to remain open for the shipping and unshipping of goods and passengers. Therefore, even if they are no longer commercially viable they are legally required to stay open. This can lead to a drain on public funds.

Municipal ports in this situation have several options open to them besides 'closure'. For example they could consider a Harbour Revision Order application to modernise their existing powers, or to reconstitute the SHA as a Trust Port (one of the other main types of SHA). Alternatively, where they own more than one SHA, they may wish to improve efficiency by applying for the approval of a Harbour Reorganisation Scheme which establishes an overarching SHA. Notwithstanding this, some may wish to close completely.

Previously if the complete closure of a harbour was being considered, a local act of parliament was required to achieve the closure. However, the Marine Navigation Act 2013 amended the Harbours Act 1964 to create a new type of order known as a 'Harbour Closure Order'. The new process allows the revocation of an SHA's status as a Statutory Harbour Authority where the 'underlying purpose' is met (namely that the harbour is no longer 'commercially viable or necessary'). Harbour Closure Orders should provide a lower cost and more straightforward way of achieving the closure of a harbour. Once the harbour is 'closed' it could, for example, be redeveloped or sold.

Harbour Closure Order applications in England and for non-fisheries harbours in Wales are made to the Department for Transport (DfT). The DfT is currently consulting on draft statutory guidance about the circumstances in which a Harbour Closure Order will be made, including how the requirement for the Secretary of State to have regard to the 'underlying purpose' of a Harbour Closure Order will be implemented in practice. It also covers the information required to be provided by harbours applying for a Harbour Closure Order.

The current consultation closes on 13 October 2015 and also covers non-statutory guidance on removal of pilotage functions orders.

Lara Moore is an Associate in the Real Estate Team at Ashfords LLP. She specialises in marine planning, licensing and regulation. Lara can be reached on 01392 333861 or This email address is being protected from spambots. You need JavaScript enabled to view it..