What are the benfits of using a customs bonded warehouse?
Question
Looking into 8 warehousing facilities in various parts of Kenya and was wondering whether custom bonded warehouses whether they be private or public would be beneficial.
Answer
Dear Rosa,
Depending on what your requirements are, customs bonded approved warehouses would possibly be of benefit to you as you could enter your shipments on arrival in to the bond facilities and defer any import duties and taxes until such time as the goods were required. Assuming they work in a similar way to UK bonded warehouses you would then clear the required goods from the bond and pay duties / taxes on those goods only and then they are free to be delivered.Or if being re-exported to another country, the goods could export under customs control and defer payment of duties etc. Shipments to Kenya are subject pre-shipment inspection and approval by KEBS Standards, and would need to check if aid / relief goods were subject to this or if any allowances could be made. We export to East Africa for many clients and can organise the inspections etc as well as offering competative rates to all African destinations.
Trust of assistance
Best regards
Darren
Answer
Hi Rosa – I would also have a look at the Kenyan system of Export Processing Zones and Free Zones to see if using on of these would be of definite. They have over 65 locations already in which goods can not only be held without duty/VAT being paid but can be processed within these areas either for re-export to other markets or remain in Kenya. According to the Kenya EPZ Authority the aim of the programmes are "to transform the economy from import subsitution to a path of export led growth.”
The EPZA is the official organ mandated by the Kenyan government to promote, attract and facilitate investment and help businesses to capitalise on: “untapped opportunities in East Africa, the whole of the African Continent and the world.” Kenya’s EPZs include extensive business regulatory reforms intended to substantially lower the cost of doing business in the regions while it is hoped that the well-developed business infrastructure makes it a natural choice for investors.
Answer
Dear Sir/ Madam,
Thank you for your enquiry on bonded warehouses in Kenya. A Customs Bonded warehouse is a warehouse licensed by the Commissioner of Customs for the storage of goods imported into the region pending the payment of duties. The goods are stored in the joint custody of the bonded warehouse keeper and Customs. Below is a brief on bonded warehouse operations.
The benefits of using a customs bonded warehouse are:
1. On-site storage;
2. Just-in-time delivery for both manufacture and general trade;
3. Less cash tied up in duties and taxes;
4. Deferred payment of taxes
They are of 2 types: Private and Public bonded warehouses. The private warehouses are licensed for the storage of the licensee’s goods while the general bonded warehouses are licensed to store goods for all traders. To be licensed, the applicant should make an application to the commissioner of Customs on Form C22 accompanied by a plan of the premises and its situation or location. The license will be issued on payment of the prescribed license fee if the Commissioner is satisfied that, the situation, construction of and accommodation in the premises proposed are suitable for use as a bonded warehouse. An annual license fee of US$1500 will be charged
I have some documents that i can share with you, kindly get in touch with me by email so as to enable me to have your eamil address.
Thank you.
Kind regards,
Emmanuel Maingi