Services Customs Bonded Warehouse Consulting & Services
A Customs bonded warehouse is a secured facility used to import and store goods without immediately triggering the obligation to pay import duties. Goods can also be transported within the US — between bonded facilities — with duties becoming due only once the goods are removed from the bonded warehouses and “enter” into the marketplace. Besides storing goods, bonded warehouses can host services, such as manufacturing, assembling, manipulating, cleaning, and sorting goods.
DB Schenker Trade Solutions provides everything you need to establish a Customs Bonded Warehouse. We help you:
Bonded warehouses improve importers’ cash flow by allowing them to delay paying duties on goods imported or stored in a bonded warehouse. Duties become due only when importers “enter” the goods into the marketplace. For example, an importer might want to store goods closer to their customers, but wait until a sale is complete before paying customs duties. Likewise, an exporter that manufactures, assembles or re-processes imported goods can avoid paying customs duties altogether if they keep the goods in a bonded facility prior to export.
Importers and exporters may wish to have all or part of a facility bonded. Warehouse operators and trucking companies may also want to establish a Customs Bonded Warehouse in order to offer this valuable service to their customers.
Whether you are an importer, exporter, warehouse operator or trucking company, we can help you with the entire bonding process!
There are 11 classes of Customs Bonded Warehouses. Each class of bonded warehouse is subject to strict usage restrictions:
This greatly depends on the needs of your business. If you’re looking to store your own imports duty-free on your own property, you’ll likely want to establish a Class 2 bonded warehouse. If you plan to offer bonded warehousing services to clients, a Class 3 bonded warehouse might be what you’re looking for. If you want to assemble or manufacture products for export using imported parts only, a Class 6 bonded warehouse may work for you. If the products are intended for domestic consumption and you would like to use imported and domestic components, then an FTZ may be your only option. But if you need to clean, sort and/or repackage imports, for either domestic consumption or re-export, then a Class 8 bonded warehouse would likely be a good fit.
Both Customs Bonded Warehouses and FTZs allow shippers to delay — or avoid altogether — paying import duties and excise tax. However, there are some key advantages and disadvantages to both:
Foreign Trade Zones
Foreign Trade Zones (referred to as Free Trade Zones in other countries) are restricted areas within the US, usually near a port, that are classified as being outside of US Customs territory. They are therefore exempted from customs duties. FTZs can be used to store, process, and manufacture goods using both imported and domestic components. Taxes on imported components are due only if/when the goods are entered into the US. At that point manufacturers can choose to pay duties on either the separate components, or the finished product, whichever is more cost effective.
FTZ advantages:
FTZ disadvantages:
Customs Bonded Warehouses
Customs Bonded Warehouses (CBWs) are secured buildings operating under US Customs Border Protection (CBP) regulations. A CBW can also be a designated secured area within a building. CBWs are used to store imported goods that have passed Customs but have not yet entered into the US marketplace. Duties become due once the goods are withdrawn for consumption. This allows importers to delay paying tax until they find a domestic buyer. If the goods are ultimately exported without being entered into the US, then no tax is due.
Customs Bonded Warehouse Advantages:
Customs Bonded Warehouse Disadvantages:
Customs Bonded Warehouses vs FTZs: which is the best option for you?
FTZs are generally best for those who import goods for re-export. They’re also usually the best option for manufacturing — especially if they use both imported and domestic components. FTZs offer more flexibility for handling goods and how they’re taxed once they “enter” the US.
Customs Bonded Warehouses are often the better option for those who import goods for domestic consumption, rather than for export. Since they can be located virtually anywhere, importers can choose the best location based on geography and the specific needs of their supply chain. A CBW may also be a viable alternative when your local FTZ is at or near capacity.
Transport goods within the US without paying Customs Duties with an Activity Code 2 Bond.
Bonded warehouses help improve importers’ cash flow. Delay paying duties on goods until they “enter” into the marketplace.
Everything carriers and freight brokers need to get licensed and stay in compliance. Let us do the paperwork! We simplify the whole process.
Schenker, Inc.
Trade Advisory & Risk Solutions
41 Pinelawn Road, Suite 110
Melville, NY 11747
Phone +1 (844) 724-8723 (in USA)
Phone +1 (516) 690-2171 (outside USA)
TradeSolutionsUS@dbschenker.com