What is a "bonded warehouse" used for?

A bonded warehouse serves a specific function within customs procedures, primarily allowing businesses to store imported goods without requiring immediate payment of customs duties. This provides flexibility for importers, as they can hold products in the bonded facility until they choose to release them into the domestic market or re-export them. Since duties are deferred, businesses can manage cash flow more effectively and decide the most opportune time to pay those duties, based on market conditions or their own operational needs.

Storing goods that have already been imported is not the defining characteristic of a bonded warehouse, as the focus is on the duty deferral aspect until the goods are either sold or exported. Selling imported goods directly to consumers occurs after the duties are paid and the goods are cleared, which is outside the operational scope of a bonded warehouse. Manufacturing goods before import does not align with the purpose of a bonded warehouse, which is specifically designed for the storage of imported goods, whether they are yet to be cleared through customs or awaiting duty payment. Thus, the role of a bonded warehouse is crucial in the context of international trade and customs regulation, emphasizing the importance of duty management and strategic storage options for businesses involved in importing goods.