ZIMSEC O Level Commerce Notes: Bonded warehouses and International Trade
- Bonded Warehouses are also looked at under the Warehousing Topic here.
Why customs authorities control bonded warehouses
- Bonded warehouses are used to store dutiable goods i.e. goods on which duty has not been paid.
- Customs authorities control activities of these bonded warehouses in order.
- Collect import duties before goods are released.
- Ensure that goods in entrepot (re-export) trade are released without payment of duty.
- To prevent smuggling of goods under bond.
- To allow goods to be packed, branded, sampled and bottled.
- To make possible the movement of goods between bonded warehouses.
Importance of bonded warehouse
- To keep dutiable goods or goods on which duty has not been paid.
- To allow goods to be packed, branded, sampled, bottled or graded but goods cannot be manufactured in a bonded warehouse.
- To enable government to raise revenue by collecting customs duties.
- To allow goods to be removed in small quantities thus saving on working capital.
- To allow certain goods to mature e.g wine.
- To enable goods to be transferred from one bonded warehouse to another by a bonded carman. A warehouse warrant is a document of title that allows dutiable goods to be released.
- To store goods for entrepot trade.
- To enable goods to be sold whilst in bond thus allowing an importer to possibly avoid paying customs duty. A customs drawback refund on duty previously paid on goods meant for re-export trade.
To access more topics go to the Commerce Notes page.