Trading in the European Union
Duties on the movement of goods within the EU
Goods that have been produced in the European Union (EU), or that have been imported into an EU country with duty paid, are 'in free circulation' within the EU. Customs duty is not payable on acquisitions (imports or purchases) of goods that are in free circulation.
Duty is normally payable on imports from outside the EU when the goods are first brought into the EU. However, goods from outside the EU can be imported into the EU without paying the normal customs duty, provided they are not released into free circulation - eg if they are held in a bonded warehouse.
You can buy goods that are not in free circulation without paying duty, provided that you do not put them into free circulation - eg, if you continue to keep them in a bonded warehouse. Duty becomes payable when you want the goods released into free circulation - eg so that they can be removed from the bonded warehouse and sold on to your customers.
For example, a German company could import goods from America into a bonded warehouse in Germany without paying duty. The goods could then be sold to a UK company, and moved to a bonded warehouse in the UK - again, without paying duty. But if the UK owner wants to take them out of the bonded warehouse - for example, to sell and deliver to their UK customers - duty becomes payable.
See our guide on customs warehousing.
A similar system applies to excise duty on products such as alcohol and tobacco. For more information, see our section on excise duties.
Subjects covered in this guide