Key words and phrases in the duty- and tax-free industry, and what they mean.
The area of an airport where access is restricted to travellers.
It is the area post security checks to boarding for departing passengers and post disembarkation to passing customs controls for arriving passengers.
Arrivals Duty Free
Sales of Duty Free goods to travellers on their arrival to a country.
Stores selling arrivals Duty Free are usually located pre-customs controls in air and seaports and at land borders to ensure Duty Free purchases may be controlled and allowances are not exceeded.
In a small number of countries, arriving travellers may avail of Duty Free shopping for a limited period after arrival (usually 24 or 48 hours) in designated stores away from their point of arrival.
Stores situated at land border crossings from one country to another.
Retail outlets that customers shop in (such as high streets or shopping malls or centres) in their country of residence primarily, and would include supermarkets, department stores, etc.
Downtown Duty Free
Where international travellers can buy duty and tax-free goods in specially licenced stores away from Airports, Seaports, or border crossings.
Depending on the country and product category purchased, sometimes the goods may only be passed to the customer once they are subsequently departing the country and not at the time the transaction is made.
Duty Free & Travel Retail (DF & TR)
The sale of goods to international travellers at Airports, on Cruise and Ferry ships, onboard International Flights, and at some International Railway Stations and licenced Downtown stores where proof of travel is provided, based on The International Civil Aviation Organization 1944 Chicago Convention.
Duty Free allowances originally exclusive to international travellers are also offered to domestic travellers in a very small number of off-shore island locations.
Duty Free Allowances
The amount of tax and duty free goods which can be imported into a country free of taxes and duties.
Each country has its own allowances and regulations when it comes to the amounts allowed.
It is the responsibility of the traveller to comply with the allowances relevant to the country they are travelling to.
Duty Free / Travel Retail Exclusives
Brands, products, or formats that are only available in the DF & TR channel.
Free Zones are specified economic areas where goods can be received, stored and sometimes sold without the payment of duty.
It is important to note that Free Zones are not the same as our duty- and tax-free industry. Duty free sales take place in a highly regulated retail environment e.g. airports, ports, ferries, cruise ships and land border shops, and their operations are governed by national customs authorities.
Our supply chain is one of the most secure in the world with processes and technologies in place to provide for verification of registration, compliance, certification, review and audit.
The area in an Airport / Seaport before the passenger goes through security and includes check-in and baggage drop areas in departure halls and post-customs arrivals areas.
The revenue generated by an airport other than revenue earned from the airlines operating there.
Offshore Duty Free
Where an island is designated as an Offshore Duty Free location.
A group of similar brands and products merchandised in a defined space within a retail store - e.g., the Fragrances and Cosmetics category or the Wines and Spirits category.
Defined behaviours and practices that individuals are required or encouraged to be aware of and observe.
The DFWC Professional Standards are an example of best practices for retail sales professionals in the industry.
The term given to all retail sales in a DF & TR setting which are not exclusive of duty and taxes.
Travel Retail includes duty paid tax-free sales, and duty and tax paid sales.
Value Added Tax (VAT)
A charge collected by governments on the sales of goods or services in the country.
It is usually set as a percentage of the value of the item or service.
In a retail setting, VAT is included in the sales / purchase price paid by the customer.
The VAT part of the purchase price is then passed to the government by the business or individual selling the good or service.
VAT Retail Export Schemes
Allows travellers who reside outside a particular country to obtain a refund of the VAT levied on their purchases during a visit to a particular country on provision of proof of export of their purchases.