A bonded warehouse in Malaysia is a key part of the logistics network, providing a secure place for storing imported goods without immediate import duties. This helps importers and exporters improve cash flow by delaying tax payments until goods are sold or exported.

 

Using bonded warehouses can lead to significant savings, especially when goods are imported for processing and then re-exported. As a trade hub in Southeast Asia, Malaysia offers incentives for using bonded warehouses, but understanding local rules and compliance is crucial.

 

What is a bonded warehouse?

 

A bonded warehouse is a secure area authorised by the Royal Malaysian Customs under Section 65 of the Malaysian Customs Act 1967, where goods can be stored without the need to pay duties immediately. It's meant for holding dutiable goods until they're ready to move out, acting as a duty-free zone with secure and controlled access. 

 

Warehouse operators often use a bank guarantee instead of a cash deposit as a bond to customs, ensuring duties will be covered and protecting revenue if goods leave the area without proper duties paid.

 

A bonded warehouse is typically known by the terms below:

 

Gudang Berlesen Awam or Public Bonded Warehouse 

 

A Public Bonded Warehouse serves as a customs bonded warehousing and central storage facility for the distribution of bonded commodities that are the products on which customs duties and taxes have not been paid around the country, as well as international trade. 

 

Gudang Berlesen Persendirian or Private Bonded Warehouse

 

A Private Bonded Warehouse is a company's and its affiliated firms' central storage and distribution centre for bonded goods that the products on which Customs duties and taxes have not been paid.

 

PEKEMA (Association of Malay Importers and Traders of Malaysian Motor Vehicles) Warehouse

 

The importer and the bonded warehouse operator both become liable for the items once they enter the bonded warehouse. In most cases, this responsibility is discharged when the products are: 

• Exported; or believed to have been exported; 
• Withdrawn to provide supplies to a ship or plane in international travel; 
• Destroyed under the supervision of Customs; or 
• Following the payment of duty, the item was withdrawn for domestic consumption.

 

The Types of Activities That Allowed in a Bonded Warehouse

 

The Malaysian Customs bonded warehouses are administratively regulated by providing Customs with information that enables them to conduct more extensive checks on clearances and inventory activities. Random physical checks are conducted, and each logistics service provider running a bonded warehouse is thoroughly inspected to guarantee compliance. 

 

In all bonded warehouses other than the PEKEMA Warehouse, the following value-added activities can be done on held goods:

• Storing goods liable to duty in a warehouse.
• Break bulking - when commodities are distributed in lesser amounts from a warehouse.
• Repacking - the packaging of homogenous commodities in smaller or greater numbers, or the packaging of different types of goods into a set.
• Relabelling - when items are relabelled, for example, with the name of the importer or distributor before being distributed domestically.
• De-vending – where items may be sold straight to a customer at a warehouse, whether tariffs and/or taxes have been paid on the commodities.
• Consolidation - the process of combining commodities (dutiable and locally supplied) for export.
• Import-export commerce – where items are imported and then re-exported.
• Internal transportation (forklift, for example) and handling fees.

 

While foreign manufacturing enterprises can seek for a Licensed Manufacturing Warehouse licence to run their own customs bonded warehouse, many companies choose to outsource this sort of storage to a logistics service provider.

 

The Restrictions on Using a Bonded Warehouse

 

Despite the clear advantages of using a bonded warehouse in Malaysia, certain restrictions and considerations must be kept in mind as follows:

• No licensee may receive or transfer intoxicating liquor into or out of a bonded warehouse in a province unless the licensee has obtained written approval from the board, commission, or agency authorised by the laws of that province to sell or authorise the sale of intoxicating liquor in that province. 
• The following domestic items may not be received into a bonded warehouse by a licensee: 
  • ​Cigars.
  • Raw leaf tobacco in a packet.
  • Tobacco that hasn't been stamped.
  • Packaged or bulk spirits that have not been subjected to duty.
  • Packaged or bulk wine that has not been subjected to duty.
  • Specifically denatured alcohol that is not subject to duty.
• The following imported goods may not be received into a bonded warehouse by any licensee: 
  • Bulk spirits.
  • Bulk wine.
  • Specially denatured alcohol.

 

What are its benefits? 

 

The benefits of utilising a bonded warehouse in Malaysia are varied, touching upon economic, logistical, and regulatory advantages for businesses engaged in international trade.

 

Restricted Items and Storage 

 

Sensitive and restricted goods can be safely stored in bonded warehouses. Basically, anything from little goods to big items and freight with unusual shapes can be stored here. 

 

Tax Savings

 

Businesses can save money on taxes by holding their products in a bonded warehouse, since duties are only paid when the items are shipped out for delivery. This implies that unsold items can be re-exported without incurring any tariffs. 

 

Multiple Forms of Storage

 

Bonded warehouses provide a variety of specialised storage services for a wide range of items. Perishable goods are stored in deep-freeze containers, while electronics and automotive components are kept in temperature-controlled chambers.

 

Modifications Made On-Site 

 

A bonded warehouse can do on-site alterations to your stored shipment. This implies you may do whatever you want with your items in terms of maintenance, testing, labelling, packing, inspection, and grading. 

 

Secure Warehousing

 

Because they pay security professionals and have security cameras for 24/7 supervision, bonded warehousing is far more secure than storage services from normal warehouses.

 

Bonded vs. Non-bonded Warehouse: What’s the difference?

 

In a bonded warehouse, duties and taxes on goods are deferred until they are moved out for the local market or re-export. This deferral benefits businesses by improving cash flow and reducing costs, especially for goods not immediately sold locally. Conversely, goods stored in non-bonded warehouses don't have this advantage. Duties and taxes are paid when the goods enter, making them ready for local distribution.

 

Bonded warehouses are regulated by a customs authority, like the Royal Malaysian Customs (RMC) in Malaysia, and require a bond or bank guarantee. This ensures customs duties will be paid if goods are mistakenly released. Non-bonded warehouses, lacking these customs checks, act as standard storage for goods that have cleared customs.

 

The focus of operations also differs. Bonded warehouses support import-export businesses by allowing duty-free storage of goods until they are processed, re-exported, or sold locally. Non-bonded warehouses generally serve domestic distribution, storing goods ready for the local market. This makes bonded warehouses key to the global supply chain, providing strategic advantages for businesses in international trade.

 

How businesses can find the perfect bonded warehouse through Industrial Malaysia?

 

When it comes to offering the best service and having access to the necessary infrastructure, the right location may make all the difference, while also increasing accessibility and lowering overall expenses. Working with knowledgeable industrial property agents will help you expand more quickly than if you manage your warehouse operations on your own. If you want to enhance your revenues and cut down on wait times, consider Industrial Malaysia. 

 

We provide a list of bonded warehouses where you may outsource the management of your goods and benefit from the benefits of utilising bonded warehouses without the trouble of putting one up yourself. Check out our bonded warehouse listing here.