Why a customs warehouse?
In addition to the customs warehousing procedure, there are other suspension procedures, such as temporary storage and transit. The transit procedure is intended for the transport – the movement of goods – under customs supervision. Goods can be stored in a temporary storage area for a maximum of 90 days. For long-term storage of goods under customs supervision, a customs warehouse is the only option.
Types of customs warehouses
There are two types of customs warehouses: a public customs warehouse and a private customs warehouse. The public customs warehouse is divided into three types, of which only public customs warehouse type II is known in the Netherlands.
In a public customs warehouse type II, there is a distinction between the holder of the authorisation and the holder of the procedure. In a public customs warehouse, anyone can store non-EU goods. In a private customs warehouse, only the holder of the authorisation can store goods.
In this contribution, the public customs warehouse has been left out of consideration.
Advantages of a customs warehouse
If goods are stored in a customs warehouse, the payment of import duties and VAT is suspended. This is a great advantage for companies. If the non-EU goods leave the Union, a company does not have to pay any import duties or VAT at all. If the goods remain in the EU, import duties and VAT only have to be paid when the goods are brought into free circulation in the Union. In addition to the advantage of suspension, the postponement of payment itself is also an advantage.
For many companies,
the final destination of the goods is not yet known in advance. It is possible
that the goods will remain in the EU, but sales outside the EU are also an
option. When goods are stored in the customs warehouse, it does not yet have to
be clear what the final destination of the goods is. Import duties and VAT are
only paid or not paid when the goods are released.
A customs warehouse can also be a solution for companies with a production process, especially when goods are processed, reworked or repaired under customs supervision (known as inward processing). It may not be known in advance whether the raw materials will be used for production for EU countries or for non-EU countries. With a customs warehouse, the goods can be stored under customs supervision. At the start of the production process, the raw materials can then be brought into free circulation or placed under inward processing.
Authorisation
Companies cannot store goods in a customs warehouse without an authorisation. The authorisation includes a number of elements, including the type, quantity and value of goods that may be stored in the customs warehouse. On the basis of this information, a company has to provide a guarantee to Customs, unless a company has an AEO authorisation and the guarantee has been waived to nil.
The aforementioned elements are not included in the authorisation without a reason. You will have to periodically check whether you still meet the authorisation conditions. If you want to store other goods in the customs warehouse than those stated in the authorisation, please contact Customs in advance.
Administration
You do not just get a customs warehouse authorisation. This authorisation allows goods to be placed in a customs warehouse under customs supervision at the company's own location. Having the authorisation includes obligations. Keeping full and proper records is one of these obligations. It must be clear at all times what is stored in the customs warehouse. Data such as the classification of goods, customs value, origin, weights and quantities must be included in the administration.
The connection with the preceding procedure and the subsequent procedure is also important. This allows Customs to check that all goods have been placed under the procedure and that no withdrawal from customs supervision has taken place.
Management of the customs warehouse
Managing or maintaining the customs warehouse is necessary to be able to retain the customs warehouse authorisation. Managing the customs warehouse is not a matter of annual "temperature control", but an ongoing process.
Every day goods arrive and leave the company. Union goods are not in scope of the customs warehouse, but non-Union goods are stored in and released from the customs warehouse.
During storage, handling may be carried out. These so-called usual forms of handling are included in the authorisation and may, for example, consist of labelling goods, repackaging goods and testing machines (if these are simple operations). These transactions must be recorded.
Periodic stock inventories are necessary to be able to check the connection between the administrative and physical stock. Carrying out these inventories is therefore an essential part of warehouse management.
Procedures, automated processes and internal controls can help you manage the customs warehouse. Procedures ensure that a standard working method is applied and automation can limit human errors. Not only procedures for the storage and release of goods are relevant, but also the procedures for classification, value and origin. By carrying out internal controls, you know whether procedures are being followed, you can correct errors and possibly adjust the processes and automation.
The high cost of mistakes
Everyone makes mistakes, but in the world of customs regulations, even minor errors can lead to significant consequences. While you can learn and rectify mistakes you identify yourself, those discovered by customs authorities can be far more costly.
Customs regularly conducts audits to ensure businesses comply with regulations. This includes verifying if goods remain under customs supervision until officially released. If discrepancies are found, Customs can investigate transactions for up to three years retroactively. This of course has financial consequences.
Conclusion and more information
An authorisation is required to store goods in a customs warehouse. Both the authorisation and the customs warehouse must be managed. This does not happen automatically. Active management requires procedures, automated processes and internal controls.
We are happy to assist you in applying for a customs warehouse authorisation. You can also contact us for the effective management of the authorisation and the customs warehouse. For questions or comments on this topic, please contact Samantha Zwart - Speelman.