ADDRESSING CHALLENGES RELATED TO CUSTOMS CONTROLS IN FREE ZONES

WCO News article –

The idea of a “free port” can be traced back to 167 BC, when the Roman Senate made a decision to turn the then Roman island Delos into a free port.  However, it is commonly agreed that the oldest free zone in its modern sense dates back to Shannon in Ireland, where the first Free Trade Zone, the most commonly referred to type of free zone, was established in 1959.  The same characteristics that make free zones attractive to legitimate business also lure fraudsters and criminals.  They can forge documents and use free zones to repackage or relabel goods, or manufacture and assemble new goods in these zones.  The transit and transshipment of goods pose the highest risk because it is easier for criminals to disguise the origin and final destination of goods.  This masking can be done by switching bills of lading once goods arrive in the free zone, switching containers and their contents, or simply by shipping goods to a different destination than the stated one.  Such practices pose risks in terms of revenue collection and public health, as well as security.  Recently, the OECD and the European Union Intellectual Property Office (EUIPO) published a study: Trade in Counterfeit Goods and Free Trade Zones: Evidence from Recent Trends, which examines the use of free trade zones in the counterfeit goods trade.  In 2018, another organisation, the Economist Intelligence Unit, issued The Global Illicit Trade Environment Index, which also focuses on free zone governance.  Supported by research and case studies related to 5 major free zones, the Index, along with the OECD/EUIPO study, fuelled a much needed debate and brought the issue to the attention of policymakers across the globe.

https://mag.wcoomd.org/magazine/wco-news-87/addressing-challenges-related-to-customs-controls-in-free-zones/

Author: raytodd2017

Chartered Legal Executive and former senior manager with Isle of Man Customs and Excise, where I was (amongst other things) Sanctions Officer (for UN/EU sanctions), Export Licensing Officer and Manager of the Legal-Library & Collectorate Support Section

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