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European Distribution Centers and regional warehouses

Are you starting logistics operations in Flanders or Europe? Below is the 4th of 5 possible business scenarios – ranging from a representative office to a fully-fledged international distribution center – for structuring your logistics activities.

Flanders — and particularly the province of Limburg — offers the high-rate logistics know-how and support we need.
Both the ports of Antwerp and Rotterdam are just around the corner.

Jaap Kohne
General Manager, Hyundai MOBIS Europe

Status

  • EDC (European Distribution Center) set up as a Belgian legal entity.
  • EDC owns goods, stored in regional warehouses.
  • EDC delivers VAS to regional warehouses and employs staff locally.
  • Possibility of setting up PEs (regional warehouses) of a Belgian entity in other EU countries.

Direct tax aspects

  • Belgian entity is taxable in Belgium.
  • Taxable profits of EDC can be determined on a cost-plus basis.
  • Upfront ruling can be obtained on low mark-up.
  • Belgian EDC can claim Notional Interest Deduction (FY2013: 3%) for equity invested in the Belgian PE.
  • Belgian EDC has no foreign PE if only storage activities in foreign countries, dependent on tax treaty; all profits are taxable in Belgium. 
  • If deemed a foreign PE, arm’s length profit allocation is required; profit of a foreign PE is exempted in Belgium.

Indirect tax aspects

  • Belgian VAT registration is needed, full (VAT) bookkeeping obliged.
  • If goods are stored in regional warehouses in other EU countries, the Belgian EDC may need to register for VAT in those countries.
  • Supply of goods to Belgian, EU or non-EU customers by the Belgian EDC is in principle subject to VAT:
    • VAT exemption is possible for intra-EU supply of goods and export supplies to non-EU.
    • Local VAT is due if goods remain in Belgium.
  • VAT treatment of cross-border supplies depends on terms of supply.
  • To avoid pre-financing import VAT, an import VAT deferral license (a so-called ET 14.000 license) can be obtained without any cash guarantee. Align customs value to the transaction price.
  • A ruling in respect of classification, origin and customs value is advisable.
  • cross-border authorizations and centralized customs clearance.
  • Belgian input VAT can be deducted via the periodical VAT return
  • VAT credits are refundable on a quarterly basis; for “export” businesses, a license for monthly refunds is available.

Interested in setting up logistics operations in Flanders?

Let us help you!

  • We can introduce you to other companies, banks and regulators
  • We organize site visits to real estate locations
  • We assist with all legal aspects of setting up a business
  • We're an official government agency
  • Our services are completely free
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Receive our handbook to setting up logistics in Flanders

  • It's completely free.

  • Learn about Flanders’ central location and intermodal infrastructure.
  • Get to know your future partners in logistics innovation.
  • Discover financial incentives and fiscal advantages for your business.
  • Choose your ideal scenario for starting operations in Flanders.

Handbook to setting up logistics in Flanders

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