From riches to rags in the UK

Up until March 31, 2005, the valuation of large ports was prescribed by statutory formula under the Docks and Harbours (Rateable Values) Order (2000). But from April 1, 2005 the law changed and the formula rating of ports was discontinued.

This change required the Valuation Office to assess large ports – and everything within them – on the same footing as properties generally, namely on the basis of an assessment of their annual rental value as at April 1, 2003.

The VOA wrote to all the port operators in May 2006, explaining the review and requesting information to enable a detailed investigation of their particular circumstances. Inspections of port properties followed.

According to the VOA this was “a major exercise, involving careful enquiry as well as physical observation, as the nature and extent of occupation was not always apparent on the ground”.

Southampton was the first port to raise concerns about the new approach, making a legal challenge in July 2004. However the challenge was withdrawn in April 2006 and the process of applying backdated business rates to port companies gathered momentum, putting port businesses in the UK under undue pressure.