Free zones #
“The term ‘free zone’ means a part of the territory of a State where any goods introduced are generally regarded, insofar as import duty and taxes are concerned, as being outside the customs territory and are not subject to the customs control.” [1]
“A distinction may be made between commercial and industrial free zones. In commercial-free zones, the permitted operations are generally limited to those necessary to preserve the goods and the usual forms of handling to improve their packaging or marketable quality or prepare them for shipment. In industrial free zones, processing operations are authorized.” [2]
“By specifying that the goods are not subject to the customs control, the definition draws attention to the fact that the customs control exercised over goods placed in free zones is more flexible than that applicable to goods stored in customs warehouses, for example, or admitted under the temporary admission for inward processing procedure. Whereas in exercising the customs control, the customs authorities have at their disposal a whole series of specific measures designed to ensure compliance with the laws and regulations they are responsible for enforcing. In the case of free zones, they normally have recourse to general surveillance measures only. Thus, premises situated in free zones are not usually subject to permanent customs surveillance. The control measures applied to goods during their stay in the free zone are generally reduced to an absolute minimum and are principally concerned with the relevant documentation.” [3]
“In some countries [a free zone] is also known under various other names, such as ‘free port,’ ‘free warehouse.'” [4]
“Free Zones” belong to the geographical and economic territory but not to its customs territory. For trade statistics the transactions between the customs territory and the free zones are recorded when using the Special Trade System (However, it is recommended to apply the General Trade System because it covers the whole economic territories, and it aligns with the coverage of System of National Accounts and Balance of Payments). Free zones can be commercial free zones (duty-free shops) or industrial free zones.
A Free Zone is not a Free Trade Area.
Bunkers #
“Bunkers” are ship stores and aircraft supplies, which consist mainly of fuels and food.
Both “Free Zone” and “Bunkers” are trading partner entities.
[1] See International Convention on the simplification and harmonization of Customs procedures [Kyoto Convention] (Kyoto, 18 May 1973), annex F.1, sect. I, Definitions, definition (a).
[2] Ibid., sect. I, introduction, third paragraph
[3] Ibid., sect. I, Definitions, commentary, note 2.
[4] Ibid., sect. I, introduction, second paragraph
