Τhe Expansion of the Special Customs Regimes for the Improvement of Logistics

Abstract

Logistics is one of the main sectors in Greece and constitutes an important source of income, representing 10.85% of GDP, and amounts to 19.8 billion euro (according to a study EEL in 2014). The developments that have been observed in the logistics sector in relation to the ports over the last years have created the need to make ports part of the supply chain in order to provide value added services to customers. Ports and especially those for container ships are evolving rapidly, providing integrated solutions for the improvement of logistics. The free trade zones, the freight transport centers and container transport hubs are part of the ports with an ever-increasing role in the management of supply chain and logistics. During last years, the port of Piraeus has become a central gateway to the European market from third countries. In addition to the port’s location, the warehouse center within the Piraeus Free Zone is also an important asset. The Free Zones are part of the customs territory of the European Community where non-Community goods which are under suspension of payment of import duties, taxes and commercial policy measures may enter and be stored until they are assigned a new customs regime [1]. Moreover, an important percentage of 3PL companies in Greece have been assigned as Authorized Economic Operators. This characteristic provides them the jurisdiction to use simplified customs procedures during import and export procedures. More and more companies are keen on using special customs regimes in Piraeus Port, as they intend to use Greece as their strategic hub in logistics in Europe or start trading within the country. Efficient procedures prior and during customs clearance can have a significant impact on eliminating delays, reducing administrative costs and improving the overall management of the supply chain. The benefits that will arise in favor of logistics by the use of special customs regimes are following: 1) Facilitating foreign trade by providing incentives for the collection and distribution of goods, thus contributing to the development of transit trade. 2) Support for business in logistics. 3) Possibility to provide VAT-exempt services in storage areas. 4) Possibility of transferring the ownership of goods, with VAT exemption, into storage areas. 5) Liquidity savings for firms. 6) Storage capacity of large quantities of goods. 7) Possibility of combining VAT facilities and simplified customs procedures. 8) Facilitating the channeling of domestic goods into international markets. 9) Investment and growth in work positions.