An explanation of what a "Customs Bonded Warehouse" is, how exporters would utilize them and their advantages. This information is part of "A Basic Guide to Exporting" provided by the U.S. Commercial Service to assist U.S. companies in exporting.
Last Published: 7/9/2016
A customs-bonded warehouse is a building or other secured area in which dutiable goods may be stored or manipulated, or may undergo manufacturing operations, without payment of duty. Authority for establishing bonded-storage warehouses is set forth in Title 19, United States Code (U.S.C.), §1555. Bonded manufacturing and smelting and refining warehouses are established under Title 19, U.S.C., §§1311 and 1312.

When goods enter a bonded warehouse, both the importer and the warehouse proprietor incur financial and legal liability under a bond. The liability is canceled when the goods are:
  • Exported
  • Withdrawn for supplies to a vessel or aircraft in international traffic
  • Destroyed under U.S. Customs and Border Protection supervision
  • Withdrawn for consumption within the United States after payment of duty
Your company could enjoy several advantages by using a bonded warehouse.
  • No duty is collected until merchandise is withdrawn for consumption. An importer has control over use of money until the duty is paid on withdrawal of merchandise from the bonded warehouse.  If no domestic buyer is found for the imported articles, the importing company can sell merchandise for exportation, thereby canceling the importer’s obligation to pay duty.
  • Many items subject to quota or other restrictions may be stored in a bonded warehouse.
  • Check with the nearest U.S. Customs and Border Protection office, however, before placing such merchandise in a bonded warehouse.
  • Duties owed on articles that have been manipulated are determined at the time of withdrawal from the bonded warehouse.