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What is a Free Port?

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  • Written By: Malcolm Tatum
  • Edited By: Bronwyn Harris
  • Last Modified Date: 10 September 2016
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    Conjecture Corporation
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Free ports, also known as free zones or free economic zones, are areas located near ports of call that offer relaxed customs duties and controls. Ports of this type are traditionally found adjacent to dock areas where ships load and unload. Since the advent of air travel, it is also possible to find a free port adjacent to a number of airports that provide international flight services. When the free port is located near an airport, it is more commonly referred to as a customs area.

There are several basic characteristics that apply to any free port, whether it is situated near the water or near an airport landing strip. In both instances, the area allows goods that are intended for reshipment to be received and stored for a short period of time, often without the need to pay duties while the goods are in storage. This amenity can be especially helpful for importers who may need a few days to arrange ground transportation from the point where the goods entered the country to their final destination. In the event that certain papers must be filed at the time the goods arrive in the country, making use of the free port also allows the importer to avoid the use of more costly storage methods, such as storing them on the ship while the paperwork is processed.

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The same basic process can be utilized when goods are scheduled for export to another port of call. In this scenario, the goods may have been delivered to a port in one country, where they will be moved to another ship and continue on to their final destination. In the event that the ships are not scheduled to be in the same port on the same day, the goods can be unloaded, stored in the free port area, and then loaded onto the second vessel once it arrives. This makes it possible to avoid delays with other shipments as well as allow for the smooth transition of traffic in and out of the port.

Today, it is possible to find at least one free port in just about every country that receives exports from international locations. While these ports do aid with storage, they also are often essential components in the distribution process of the goods once they reach the right port of call. Many businesses rely heavily on the use of free ports as a means of keeping the flow of products from one country to another consistent, timely, and profitable for all involved.

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