Warehouses of this kind are frequently used by French importers who have no intention of leaving their goods in bond, but desire to expedite delivery. They have found that goods shipped in bond to the warehouses in Paris are allowed to pass the frontier without delay and once in Paris are quickly cleared, while goods not so directed are frequently held up for long periods at the congested frontier custom-houses. Moreover, in the former case, the importer need not maintain a representative at the port or customs sta tion of entry. He can either attend to the clearing himself, or else have the company do so.
These warehouses, or entrepots, as they are called on the Continent, render substantially the same kind of services. The Vienna warehouses, however, went so far as to attend to the taking and shipping of sam pies. The government warehouses in Trieste ex empted goods from warehouse charges during the first three days of storage.
In some cases chambers of commerce administer the warehouses, as is the case in Bordeaux. In Liverpool, the Mersey Docks and Harbor Board, a public trust created by special act of parliament, is in charge of the administration of these facilities.
In the Latin-American countries the bonded ware house is infrequent. In Bahia, Brazil, the Federal government and also the State government maintain ordinary storage warehouses. The Central Bank of Mexico City, the Mercantile Bank of Vera Cruz, and the Anglo-Mexican Banking Company jointly own a subsidiary company which among other functions per forms that of storing "national and foreign mer chandise." 12. Free zones.—In countries having a high pro tective tariff which are at the same time great re shipment centers, free zones or free harbors are fre quently established. The purpose of the free zone is the same as that of the bonded warehouse. It is merely a section of a port and sometimes an entire port excluded from the customs territory. Re-ship ment, storing, and manufacturing may take place within the zone without involving the payment of duties. As soon, however, as the goods pass out of the free zone into the customs territory duties must be paid.
Free harbors are found in Hamburg, Bremen, Co penhagen, Trieste, Hongkong and Singapore. Re cently Christiania has undertaken work for the estab lishment of a free port. Malmo, Sweden, appropri ated 15,000,000 crowns for the building of a free port which was expected to be completed in 1920. Hels ingfors, Finland, plans- one ; Barcelona a deposito franco or free depot and Cadiz a free zone. In Eng
land a special committee of the Association of Cham bers of Commerce of the United Kingdom was ap pointed in 1918 to investigate the establishing of free ports in the British Isles.
The administration of these free ports is sometimes in the hands of the city to which the port belongs, sometimes in the hands of the central government, and sometimes in the hands of a separate corporation. The latter is the case in Copenhagen where the free port is controlled by the Copenhagen Free Port Com pany, Limited, created by royal charter in 1892.
The question of a free port in the United States has been discussed in commercial circles. The Merchants' Association in New York advocated the creation of one in New York. A National Free Zone Associa tion was formed in 1919 and bills have been introduced in Congress to authorize the creation of zones and their administration. Free ports both on the Atlantic and on the Pacific Coast are therefore a likelihood.
13. Transportation rates.—Draw-backs are only one method of giving indirect support to manufactur ing exporters. In many countries, goods shipped to ocean ports from interior points and intended for ex port are charged a lower freight rate than goods in tended for home consumption. These "export thru rates" are to a limited extent found in the United States. They were very common in Germany and formed a very substantial aid to the export trade of the country.
Sometimes the difference in freight rates is very great ; from 'Westphalia to Hamburg the average nor mal price was, some time before the war, 5.11 pfgs. per ton kilometer, and the average special price al lowed to exporters was 2.6 pfgs.
A. M. Thackera, United States Consul General at Paris, in a report of the United States National Waterways Commission, made the following com parison: In 1914 Aulagnon estimated that the reduction of rates in favor of German exporters on grains, al cohol, sugar, coal, steel, lead and wood amounted to approximately 35 per cent. By means of interna tional tariff treaties, Germany gained control over in ternational thru-rates with the result that the rates on German, Swiss and Italian thru freight were ar ranged in such a way as to place Northern Italy economically at the mercy of Germany. The govern ment railroads of Germany transported at a loss in order to develop exports.