Bonded Warehouse
Also known as: Customs Bonded Warehouse, Bonded Storage, CBW
Definition
A bonded warehouse lets importers store goods without immediately paying customs duties. The warehouse operator posts a bond guaranteeing duties will be paid when goods are eventually released into commerce.
Benefits of Bonded Warehouses
| Benefit | Explanation |
|---|---|
| Defer duties | Pay only when goods sell |
| Cash flow | Don’t tie up capital |
| Re-export option | Avoid duties entirely |
| Quota management | Hold until quota opens |
| Quality inspection | Check before paying |
How It Works
- Goods arrive at port
- Transferred to bonded warehouse
- Stored under customs supervision
- Duties paid upon release
- Or re-exported duty-free
Bonded vs. Free Trade Zone
| Bonded Warehouse | FTZ |
|---|---|
| Storage focused | Manufacturing allowed |
| Specific goods | Broader operations |
| Time limits may apply | More flexible |
| Lower setup cost | Higher infrastructure |
Time Limits
Goods typically can remain bonded for:
- USA: Up to 5 years
- Varies by country
- Extensions sometimes available
Who Uses Bonded Warehouses
- Importers with slow inventory turns
- Re-exporters
- Companies managing quotas
- Seasonal product importers
- Businesses testing markets
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