Let’s start with “What is a Customs Warehouse?” A Customs Warehouse, also referred to as a Bonded Warehouse, is not a new concept; it actually dates back to the early 1700s. It was proposed as a way to reduce revenue fraud and to help importers stay competitive when importing heavily taxed items. The proposal wasn’t adopted until the late 1800s. The original provisions referred to the locations as “King’s Warehouses”. These warehouses were provided by the “Crown” or had to be approved by the customs authorities. Importers were required to give bonds to pay for duties when articles were removed instead of at time of importation. According to the European Commission Taxation and Customs Union, customs warehousing:
“Allows the owner to hold imported non-Community goods in the Community and choose when he pays the duties or re-exports the goods. The amount of working or processing allowed on goods held in warehouses is limited essentially to keeping them preserved with a view to subsequent distribution. However, it is possible to process goods under inward processing or processing under customs control on the premises of a customs warehouse.”
In other words, goods that enter the customs territory of the European Union (EU) from outside the EU may be stored under the supervision of Customs. There are different types of Customs warehouses, all having their own characteristics. However, all are required to keep stock/inventory accounts. All deposits and removals should be entered in the stock accounts and made visible to the Customs administration.
You’re probably thinking: “now I understand what a Customs Warehouse is, but what’s in it for me and my organization?” For you as an importer, it’s an efficient way to choose the best time to clear goods and pay their duties. You can even elect to re-export them outside the European Union. Furthermore, certain trade policy and agricultural policy measures and import restrictions are not applied. Organizations use it as a means to suspend or defer import duties and/or value-added tax (VAT) on goods entering the European Union.
So . . . .
- Does your company store goods that are subject to Customs control and Customs duties and taxes?
- Will a substantial part of your stored goods be re-exported outside the EU?
- Do you or your agents/partners have a need to file in more than one EU country?
- Are you making use of monthly Customs filing in an administratively controlled environment?
This is all well and good. You like the fact that you can save your company money, but it sounds complicated. It would be great if there was technology that helped me manage this process. Well, there is . . . the Descartes Customs Warehouse Management software module will allow your company to manage the goods stored under this procedure. The system stores information about the imported goods and accounts for movements made in the stock. The information can be downloaded from a commercial/logistics system or, eventually, entered manually. The system provides a declaration to Customs containing data related to the duty and VAT calculations and statistical information for all movements. The Descartes Customs Warehouse Management on-demand solution has been specifically designed to allow users to manage goods stored under the Customs Warehouse procedure, by keeping information on imported goods and accounts, tracking movement and activity, and enabling accurate and timely electronic declaration processing.
Using a Customs Warehouse can save you money, and managing your goods entering and exiting the EU can be made much easier with an on-demand solution. Why wait any longer to find out more?
