🇨🇭Precious Metals Vaults and Freeports: Allocated Storage, LBMA, and Free Ports

Gold outside the monetary system

Until 1971 gold stood behind the world's currencies; when the United States closed the gold window the peg disappeared and the metal shifted from a monetary base to a private reserve. The logic that keeps gold in portfolios today took shape then: it depends on no one and is no one's liability. Free ports grew out of a different need — storing goods in transit without duty; the Geneva Freeport has operated since 1888. Over time the demand for secure storage of valuables turned them into depositories for art, wine and precious metals: Singapore's Le Freeport opened in 2010, Luxembourg's in 2014.

Stored Bullion and Claims on a Bank

Physical precious metals — gold and silver — remain a classic way to hold capital outside the financial system: they have no issuer that can fail and no counterparty credit risk. But gold can be owned in several different ways, and the form of storage decides what you actually own and which risks you carry.

Allocated and Unallocated

Allocated storage means specific bars assigned to one owner and segregated by serial number; the metal is legally yours and sits off the bank's balance sheet, so the custodian's insolvency does not reach it. Unallocated (pooled) storage is cheaper and easier to trade, but it is only a claim on the institution: the bank owes you a quantity of metal and you carry its credit risk. For preserving capital, allocated is the usual choice. UBS distinguishes two products. A metal account gives a quantity-delivery claim without ownership of the metal; key4 gold provides co-ownership of physical gold in collective custody for eligible Swiss-resident clients. Individually allocated bars differ from both: compare title, identification of the metal and physical delivery procedures. British Atlantic Bank supports both allocated bars and metal accounts, letting the client choose between identified physical holdings and an account claim. Allocated holdings are recorded by bar number, weight, fineness and storage location. For physical delivery, fabrication, transport, insurance, storage and release costs are agreed separately. Recording pledges alongside the holdings connects the portfolio valuation to the metal actually available for delivery.

The diagram below separates the two regimes by what the owner actually holds: title to specific bars, or a claim on the bank.

Quality Standard

The professional market runs on the LBMA Good Delivery standard: bars, their fineness and their provenance meet a single set of requirements, and valuation follows LBMA prices. This ensures liquidity — a bar from an accredited refiner is accepted at any major vault. The LBMA requires refiners to follow its Responsible Gold Guidance — responsible-sourcing rules that screen out metal from conflict zones and dubious sources; failure to adhere leads to removal from the Good Delivery List.

Freeports

A freeport is a customs warehouse inside a free-trade zone where goods are stored with import duty and VAT suspended until they leave the zone. For precious metals, art and wine this removes import tax for the duration of storage. For investment gold the relief in the EU and the UK goes beyond customs deferral: supplies of bars of at least 995 fineness are VAT-exempt as such — in the EU the regime was introduced by Directive 98/80/EC (now Articles 344–356 of Directive 2006/112/EC), and in the UK it operates under VAT Notice 701/21. The main centres are Switzerland (the Geneva Freeport), Singapore (Le Freeport) and Luxembourg; Switzerland also remains the world's leading centre for gold refining.

Non-⁠bank vaults: Vienna

Alongside the customs model sits non-bank storage on a smaller scale — private depository vaults. Vienna's example is Coburg Tresor inside Palais Coburg: over four thousand individual boxes, round-the-clock access on a personal card, PIN and physical key, with a robotic system delivering the box. The format fits where metal or other valuables have to be kept off a bank's balance sheet and outside a customs procedure.

The legal frame differs from a bank's in kind, not degree. This is a contract of safekeeping, not a deposit: the operator supplies a locked container and answers for its physical security, but never becomes the client's debtor and never puts the contents to work. FMA and ECB supervision reaches credit institutions, not a safe-deposit box, so the banking Einlagensicherung — the €100,000 deposit guarantee — does not apply to a box's contents. The holder's protection reduces to the insurance policy and the contract terms.

The parameters to check before placing anything:

• insurance. The rent includes cover for the contents up to €35,000; an extended policy raises the limit to a maximum of €1.5 million. Before placing high-value items, agree the limit, the evidence of value required and the exclusions under the policy actually in force;
• weight limit. The total weight of a box's contents must not exceed 20 kg — for precious metals that ceiling binds well before the box runs out of volume;
• joint rental. Every joint renter signs the contract and has access; termination requires all renters to take part;
• death of a renter. A joint rental may continue after one renter dies; for a sole box the heir or executor must produce the court document the operator prescribes. Access for an heir therefore opens through the applicable jurisdiction's succession procedure, not through the safekeeping contract.

The historical benchmark for comparison is Vienna's Das Safe in Palais Auersperg, running since 1984 on a left-luggage principle: insurance of roughly €36,000 and, in its day, no mandatory identification. That regime has since shrunk under the CRS, beneficial-ownership registers and the EU's 2024 anti-money-laundering package: anonymous rental is now expressly excluded. A private safe solves the problem of physical security, not of tax invisibility: the perimeter is set by the owner's residence and the provenance of the assets, and the vault's address is secondary.

Singapore and Switzerland

Singapore strengthened its position by exempting investment precious metals from GST from October 2012; even after the GST rate rose to 9% in 2024, investment-grade metal — gold of at least 99.5%, silver of at least 99.9%, platinum of at least 99% — stays outside the tax. Together with Le Freeport this restored the city's role as a hub for physical gold trading. Switzerland has traditionally not charged VAT on investment gold and remains a leading refining centre: a notable share of the world's metal flow passes through its plants.

Costs

Physical metal carries its own cost: storage and insurance fees, the bid-ask spread, and a premium over spot for small bars and coins. Precious metals are therefore held as insurance and a store of value, not as a source of current income. Tax on the way out belongs on the same list: in many countries bullion and coins fall into the collectibles category with its own rate of gain — see the country map.

Who holds metal and why

The main buyers of physical gold today are central banks. In 2022–2024 they took more than 1,000 tonnes a year off the market, a record since the 1950s; in 2025 the pace slowed to roughly 863 tonnes but stayed well above the 2010s average (around 470 tonnes). The turn toward metal was accelerated by the 2022 freeze of the Bank of Russia's reserves: some 300 billion dollars of reserves, the bulk of them immobilised in European settlement infrastructure — Euroclear above all — showed that currency reserves held in accounts are vulnerable to a political decision, while physical metal in one's own vault is not. More detail is in the review of capital relocation from Russia.

The same logic works at the level of private capital: a physical-metal allocation serves as insurance against systemic risk and produces no current income — it is held for portfolio resilience, which is typical of family office strategies. State practice is telling too: in 2013–2017 the Bundesbank moved part of its gold from New York and Paris to Frankfurt to keep a larger share of the reserve under direct control.

What's changing

A combination of central-bank demand, geopolitical risk and inflows into exchange-traded funds pushed gold to record highs: by mid-2026 an ounce costs around 4,200 dollars against roughly 2,000 dollars in 2023. The storage environment is changing too: the secrecy that free ports were known for is giving way to transparency — mandatory inventories, provenance checks and automatic exchange of data under CRS. Digital formats have appeared — tokenised claims on specific bars; legally they revive the original question of whether you own the metal or an issuer's liability.

Eight vault jurisdictions side by side

The vault's address changes four things: whether the metal was taxed on the way in, whether it can sit under a customs procedure, whether the account reaches a tax authority automatically, and what document an heir needs to take it out. The grid compares the eight locations where private metal is most often stored.

Gold travels almost everywhere without VAT: Switzerland zero-rates bars of at least 995 fineness and exempts their import (Articles 23(2)(12) and 53(1)(m) of the VAT Act), the EU and the UK exempt investment gold, Singapore exempts it at 99.5%, and the UAE Ministry of Finance lists investment-grade gold and silver of 99% purity among zero-rated supplies. Silver is where the vault's address starts to cost money. Outside Singapore, the UAE and Hong Kong a silver bar bought for storage carries full VAT — 8.1% in Switzerland, 17% in Luxembourg, 20% in the UK and Austria — unless it stays under a customs procedure, which is why a customs warehouse or freeport matters far more to a silver or platinum holding than to a gold one.

The reporting column separates the United States from everyone else. Seven of the eight locations exchange account data under the CRS; the United States relies on FATCA, whose reciprocity is narrower. That does not make a US vault invisible: whether a storage contract is a reportable account at all depends on the contract, as the Q/A below explains, and a metal account kept by a bank is treated differently from a box rented from a depository.

The last column is the one most often overlooked. A vault releases metal to an heir only against the document its own law recognises, so a family whose succession is governed elsewhere should plan for recognition of that document in the vault's country. Inside the EU a European Certificate of Succession works across Luxembourg and Austria; a Swiss, UK, Singapore or Hong Kong vault expects its own grant or certificate, and a US vault usually requires ancillary probate in the state where it sits.

The tax that falls on a later sale is a separate question, decided by the owner's residence rather than the vault; it is mapped in collectibles capital gains.

Storage charges, insurance and identification

The country comparison needs a second layer: the actual storage contract. The examples below cover the same eight locations, under the operators’ published terms. They are individual services, not national tariffs. A bank box, a private box and bullion held through an online account provide different access and withdrawal arrangements. A box in Luxembourg does not acquire the Freeport's customs treatment merely because it is in the same country.

For Zurich, Singapore, London and New York, BullionVault provides a useful comparison with the account provider held constant. Its published bar lists include gold in all four cities and silver in Zurich, Singapore and London; they do not list New York silver.

BullionVault A — custody tariff. Ordinary custody costs 0.12% a year for gold, minimum US$4 monthly; silver costs 0.48%, minimum US$8 monthly. Insurance is included. Charges are separate for each metal. Reserving a specific bar raises annual custody to 0.18% for gold or 0.72% for silver, plus a one-off reservation charge. Trading, transport and physical withdrawal have separate charges. At an unchanged US$10,000 gold value, the monthly minimum produces US$48 annual custody; at US$100,000, the percentage produces US$120. These examples exclude other charges and price changes.

BullionVault B — insurance. The contract promises theft and damage cover to bullion-industry standards and monitoring of a limit sufficient for the stored bullion's value. It also recognises exclusions, giving nuclear war as an example. The vaulting FAQ directs logged-in clients to insurance evidence. The current certificates, deductible and complete exclusions were not available in the public material reviewed; no zero-deductible promise follows from the custody rate.

BullionVault C — identification. Validation is required within two weeks of funding: identity, linked-bank evidence and address checks, with entity and ownership documents where applicable. Trading may precede validation, but withdrawal may not. Additional source-of-funds or wealth evidence can be requested. This is an account requirement, not a monetary allowance for anonymous storage.

For Coburg, the separately published additional-insurance schedule quotes €97.50 a year to bring total cover to €100,000, €875 for €500,000, €1,500 for €1 million and €2,100 for €1.5 million. These premiums are added to rent. The schedule does not substitute for the insurance wording. The rental terms distinguish insured events from operator liability, including limits for force majeure and official intervention; §9.3 also addresses loss of additional cover following premium arrears.

The missing documents matter to the comparison: an advertised insured service is not evidence of an unlimited policy, and an unpublished price is not a zero charge. Luxembourg Freeport pricing and cover remain a separate quotation exercise from the bank-box example. For DMCC, the tariff, insurance terms and onboarding rules remain unverified. For the other examples, the public documents establish the charges and stated cover above, but do not complete a comparison of current policy deductibles and all exclusions.