Bonded warehouse (Part 2)

Bonded warehouses are warehouses in which dutiable goods may be stored without paying the duties on such goods. For importers, there are a number of advantages to using bonded warehouses which make them a popular storage option in many ports all over the world. Different governments have different laws about how such warehouses can be administered and who can use or operate a bonded warehouse.

Also known as a customs warehouse, a bonded warehouse acts  like a no man's land where goods can be deposited without an importer or an agent needing to pay duties on them. If the importer decides to sell the goods for re-export, duties will not be incurred. Likewise, if the goods are destroyed, the obligation to pay duties will also be resolved. If the imported goods are released for sale, however, customs duties will come due.

Importers appreciate the flexibility of bonded warehouses, as if they can't get a good price for goods domestically or can't sell them at all, they can sell them for re-export without having to worry about the duties which might already have been paid. Paying duties on arrival can also be expensive, and using a bonded warehouse allows importers to access funds from the sale to pay the duties, rather than having to pay duties in advance. Customs officials also use bonded warehouses to store impounded or confiscated goods while working out what is going to happen to the goods, thereby ensuring that people don't pay duties on goods they cannot use.

Some bonded warehouses are operated by the government. Others are run by third parties which contract out their warehouse space, and in some cases they may take on the responsibility for paying duties, while in other instances, the importer or agent who arranges for the storage is responsible. Import/export companies may maintain their own bonded warehouses for the convenience of themselves and their clients, especially if they do a great deal of business

Individuals who want to open bonded warehouses generally need to file applications with Customs in the nations where they intend to operate warehouses. The application process can be complex and lengthy, and some people choose to contract it out to a lawyer who is experienced in such issues. In addition to meeting Customs requirements, bonded warehouse operators may also need to meet requirements set by the port where they operate, including providing evidence of insurance, installation of security systems, and measures to prevent loss due to fire or contamination