A. Principle
A customs warehouse is a warehouse approved by the customs authorities, where imported goods may be stored without payment of customs duties. In principle, goods may be stored in a customs warehouse for an unlimited period.
B. Types Of Warehouses
One must distinguish between two major types of customs warehouses:
- A public customs warehouse is a warehouse in which anyone can store goods. Public warehouses can be managed by either the customs authorities or a private company.
- A private customs warehouse is a warehouse which can only be used by the person/company which manages the warehouse.
In combination with distribution activities, a private customs warehouse is most convenient.
C. Goods Which Can Be Stored In A Warehouse
Community as well as non-Community goods can be stored in a customs warehouse. However, subject to certain exceptions, only non-Community goods can be placed under a customs warehouse regime. As a rule, non-Community goods of any kind may be admitted into a customs warehouse, regardless of their nature, quantity, country of origin or destination. However, certain kinds of goods are excluded on the grounds of public safety, health, etc., as well as on the grounds of the specific limitations of the warehouse installation in question.
D. Procedural Formalities
1. Authorization
Persons, including companies, wishing to operate a customs warehouse must be established in the EU and obtain an authorization from the customs authorities.
A company will be deemed established in the EU if it has its registered office, central headquarters or permanent business establishment in the EU. Distribution centers, whether taxable or not, will in principle always meet this test either because they are a separate legal entity with registered office in Belgium or because they are a permanent business establishment of a company established outside the EU.
The authorization can be obtained by filing a written request containing all information required for granting the authorization and in particular demonstrating that an economic need for warehousing exists.
2. Guarantee
In order to cover the potential taxes, a guarantee of maximum one tenth of the amount of these taxes on the average stock of the warehouse must be provided. The authorization will only be granted after payment of the guarantee.
E. Handling Permitted During Storage
Goods stored in a customs warehouse are allowed to undergo certain operations, called "usual forms of handling". Usual forms of handling are any operation carried out manually or otherwise on goods entered into a customs warehouse with a view to preserving them, improving their presentation or their merchantable quality or preparing them for distribution or resale (minor assembly activities are also accepted).
Annex 69 to Regulation 2454/93 contains an exhaustive list of the usual forms of handling which are permitted.
F. Removal Of Goods
When goods leave the customs warehouse, they may be exported outside the EU, released for free circulation or placed under another customs procedure. In case the goods are released for free circulation, import duties will become due at that time.
II. V.A.T. STATUS OF GOODS PLACED IN A WAREHOUSE
A. Exemption From V.A.T.
The importation of goods in a customs warehouse, the sale or transfer of the goods while they are in the warehouse and the usual forms of handling which the goods may undergo in the warehouse are exempt from V.A.T.
B. V.A.T. Warehouse
Instead of placing imported goods in a customs warehouse, they could also be stored in a V.A.T. warehouse.
Goods which are placed in a V.A.T. warehouse are exempt from V.A.T. only. The customs duties, however, are due immediately upon importation in the EU.
A person wishing to operate a V.A.T. warehouse must obtain an authorization from the customs authorities and give security.
Goods stored in a V.A.T. warehouse are allowed to undergo the same usual forms of handling as in a customs warehouse.
C. Fulfillment Of The V.A.T. Formalities
Once the goods are removed from the customs or V.A.T. warehouse, the V.A.T. addressee, i.e., the purchaser or the owner of the goods, must take care of the V.A.T. formalities including the payment of V.A.T. in case the goods are declared for consumption in the EU. However, Belgian import V.A.T. will not be due if the declaration for consumption is followed immediately by a sale to a person established in another member state of the EU.
The content of this article is intended to provide general information on the subject matter. It is not a subsitute for specialist advice.
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