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Good Consumption within UAE Free Zones

Everyone is talking about Dubai Customs Notice 17/2020 but no one is providing some context and historical background on how consumed goods were treated or declared. And how this Notice is easing doing business in UAE free zones and really saving businesses a lot of money.

So here we go, and I will try in the simplest words as I always do 😊


What you import into a free zone minus what you export should equal to your inventory. Sounds pretty simple but your inventory should be tracked based on the reference of the import customs declaration and the goods HS Codes and likely on FIFO (if you are not aware of what HS Codes are, let me know and I will shed some light on that).

So, if you import furniture, laptops, consumables, and a wide range of products that you utilize in the free zone, those goods are assumed to remain as part of your inventory. Except that after 10 years of operations you have no clue what you have consumed or used or scrapped or gave away. But with Dubai Customs records, you still have the goods as you never declared them out as exports of the free zone.

This is where it becomes interesting. The unofficial feedback and treatment followed was that consumables and other similar in nature goods, shall be subject to customs duty within the free zone. Businesses who knew this used to declare this manually to their customs office and the unlucky ones who did not know about how free zones work, were faced with duty on the utilized/consumed goods and may be penalties.

So now Dubai Customs make it official that consumables (specified below) shall not be subject to import duty which is something will ease a lot of burden of free zone companies and save them actual money.

If you want more information on Free Zones import and export stock tracking read this article:

Dubai Customs Notice 17.2020

Dubai Customs on 22 October 2020 issued Customs Notice 17/2020 to facilitate and organize the customs procedures and further to increase the accuracy of stock count of free zone companies.

The Notice differentiated between goods subject and not subject to duty as follows:

1. Consumed Goods not Subject to Customs Duty

These comprise goods that are used and consumed within free zones for the establishment, operating and maintenance of projects and facilities as well as those that are involved in the manufacture of any goods or production of any service.

This includes:

  1. Packaging materials

  2. Machinery, equipment, and spare party required for operating and maintaining of facilities

  3. Petrol, oil, lubricants, and materials utilized in manufacturing and operations

  4. Office supplies and equipment as well as laboratory devices and materials needed for scientific research and training in the facility

  5. Materials that are damaged, waste and other similar goods that are not suitable for use, sale, or recycling

  6. Any other goods or materials specified by the competent department (This is very good as it does not limit the Notice to the above 6 points only)

2. Goods Subject to Customs Duty

These are goods that are sold to the local market which is by default will be subject to customs duty when preparing the export/import customs declaration. Unless you are smuggling the goods out of the free zone (do not do that!).

Goods consumed in the free zone in cases other than those specified in the previous point 1 shall be subject to customs duty.

This includes, but are not limited to, the following:

● Electronics, perfumes, tires, foodstuff, and so on sold and whether in retail or wholesale within the free zone to natural and legal persons.

● Worn items or damaged items, oil residues factories and vessels or recycling waste which is suitable for use, sale, or recycling

How to Disclose Goods Used or Consumed

This is now simple; you shall submit a “Consumption Goods Declaration” at least on a quarterly basis to the relevant customs authority at your free zone along with:

● Invoices that include the value of the goods for customs purposes

● Customs inspection report, if applicable

● Approvals and reports from the respective competent authorities

● Any other documents that are requested by Dubai Customs

I hope this is helpful, any questions, happy to answer.


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