What are bonded goods?
Bonded goods are imported goods whose import duties and taxes are suspended rather than paid on arrival. While duty is unpaid they must stay under customs control, usually in a bonded warehouse, until they are released for free circulation (and duty is paid), re-exported or placed under another customs procedure.
Core principle: Duty is only paid when, and if, goods enter the domestic market. Until then they are “in bond”.
Why businesses keep goods in bond
1. Cash flow
What it is: Duty and import VAT are paid only when goods leave the bonded location for the local market.
Why it matters: Brands holding months of stock avoid paying tax up front on goods that have not sold yet.
2. Re-export without duty
What it is: Goods that are shipped on to a non-EU destination can leave without EU duty ever being paid.
Why it matters: Useful for regional hubs that serve customers both inside and outside the EU.
3. Time to decide
What it is: In the EU there is no time limit on customs warehousing.
Why it matters: Importers can wait until the final market is known.
Bonded goods in the EU
Under the Union Customs Code, keeping goods in bond is called customs warehousing, one of the special procedures. The authorisation holder must keep stock records that customs can audit, and goods can only undergo usual forms of handling, such as repacking or labelling, while in bond.
Example: An importer brings 10,000 units of electronics into an EU customs warehouse. Each week, 1,000 units are released for free circulation and duty is paid on those only. A batch sold to a Norwegian distributor is re-exported without EU duty.
Frequently asked questions
Do bonded goods pay VAT?
Import VAT is normally suspended along with duty while goods are under customs warehousing and becomes due when they are released for free circulation.
Can bonded goods be sold?
Yes, ownership can change while goods are in bond, but duty must be settled before they are released into the local market.
What is the opposite of bonded goods?
Goods in free circulation, meaning duty and taxes have been paid and the goods can move freely within the customs union.
