Bonded Warehousing and its management in Zimbabwe


What is a bonded warehouse?

A bonded warehouse is a place, a building or other secured area in which dutiable goods may be stored for after importation or manufacture without payment of duties due to customs. In simple terms, it is a duty-free zone or area which have been granted the rights to store goods waiting final clearance by customs. In Zimbabwe the bonded warehouses are managed under the Customs Excise Act Chapter (23:02) as read with the Customs and Excise General Regulations Act. Section 68 of the C&E Act as read with section 71 of the C & E regulations states that any person or business interested in operating a bonded warehouse shall make an application to the Commissioner of customs in writing submitting details and location of the bonded warehouse. The application shall be accompanied by a guarantee from a surety who can be a commercial bank or a registered insurance company. The surety shall be bonded to the customs commissioner to the total amount of duties for goods which can be entered into the bonded warehouse.

Bonded warehouses provide specialized storage services such as deep freeze or bulk liquid storage, commodity processing, and coordination with transportation, and are an integral part of the global supply chain. There are basically two types of bonded warehouses namely wet and dry. Wet bonded warehouses are the only ones in which alcohol and tobacco may be stored. Dry storage are for any other goods as approved by the Commissioner. The main objective of using a bonded warehouse is to keep all materials at stock, till the time they are to be used, sold or transported to somewhere else in the country or outside for exports.

How does a bonded warehouse work?

Upon importation or completion of production for excisable goods, the importer or deemed shall lodge a bill of entry (Form 21) with customs for approval and processing of entering goods into the bonded warehouse. The proprietor or owner of the bonded warehouse shall in writing give authority to customs to release goods without paying duty into his/her custody and acknowledge the receipt of the goods within 10 days through the forms prescribed by the commissioner of customs.

The goods may be exported without the payment of duty, or they may be withdrawn for consumption upon payment of duty at the rate applicable to the goods in their manipulated condition at the time of withdrawal. Upon entry of goods into the warehouse, the importer and warehouse proprietor incur liability under a bond. This liability is generally cancelled when the goods are:

• Exported; or deemed exported;

• Withdrawn for supplies to a vessel or aircraft in international traffic;

• Destroyed under Customs supervision; or

• Withdrawn for consumption domestically after payment of duty.

Removal of Goods from Bonded Warehouse

Customs and Excise Act Section 71 states that :

(1) No goods which have been warehoused shall be taken or delivered from a warehouse except in accordance with the regulations and upon entry and payment of any duty due thereon and payable in terms of this section.

(1a) Any person who takes or delivers goods from a warehouse in contravention of subsection (1) shall be guilty of an offence and liable to—

(a) a fine not exceeding level twelve or three times the duty-paid value of the goods concerned, whichever is the greater; or

(b) imprisonment for a period not exceeding five years; or to both such fine and such imprisonment.

Which goods are stored in the bonded warehouse?

• Raw materials

• Any other finished goods as approved by the commissioner of customs.

What are the benefits of bonded warehouses?

• Customs and excise duties and taxes payment is differed to the time goods are required.

• Increased customer satisfaction as goods are locally and readily available once duties have been paid

• Allows for benefiting from trade and quantity discounts

• Reduction on logistical costs as large quantities can be imported without payment of duties.

• Increased liquidity and cash flows as duty payments are deferred

• Standards on products can be maintained.

• Income generating from rental income by other users.

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