The Billion-Dollar Art Vaults: Secrets of Freeports Revealed
Behind the high-walls and climate-controlled vaults of the world’s most secretive storage zones lies one of the wealthiest corners of the art world. In “The Billion-Dollar Art Vaults: Secrets of Freeports Revealed”, we uncover how the ultra-rich are using hidden warehouses in places like Geneva, Singapore and Delaware to stash masterpieces, avoid taxes, trade anonymously, and stay one step ahead of scrutiny. Explore the architecture of art, secrecy and money where a Picasso may be locked away not for public display, but as a capital asset. Freeports have been around since the 1800s, providing importers with a way to store goods and defer taxes. But in the world of high-value art, they have become more than just storage facilities.
They are now at the heart of a global debate—offering security, tax benefits, and discretion, while also facing scrutiny over their potential role in tax avoidance and illicit activity. Here, we take a deep dive into the world of art Freeports, the billionaires who use them, and the evolving regulations that seek to keep them in check.
The History and Purpose of Freeports
In the art market, Geneva Freeport (Zollfreilager Genf) or Ports Francs et Entrepôts de Genève (PFEG) is a secure location of warehouses and considered the world’s oldest and largest Freeport facility with 150,000 square meters with an estimated 40% of its collection being art. It has an estimated insurance value, in the press, of US$100 billion.
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The benefit of the facility is security for high value items with advanced technology and 24/7 surveillance.
The Art World’s Secret Vaults
Geneva Freeport is thought to hold 1.2 million pieces in two locations which has often been reported to include the most revered artists work in the world such as Picasso, Da Vinci, Klimt and Renoir. The Geneva Freeport is majority owned by the Canton of Geneva but previously included Natural Le Coultre, a logistics company, with renowned art owner, Yves Bouvier at the helm but which is now owned by French packing and logistics company, Chenue. Natural Le Coultre currently have art storage at Geneva Freeport of 35,000 square meters of secure warehouse units for artwork and valuables.
Why Collectors and Investors Use Freeports
Much reporting talks about Freeport uses for tax avoidance but following high profile reports of crime and fraud, anti money laundering laws have changed to combat and prevent such activity. Swiss law, for instance, on Freeports has evolved, with stricter regulations implemented in 2016 to prevent illicit activities, including enhanced transparency requirements and a focus on identifying owners of stored goods.
In 2022, Chinese cryptocurrency billionaire Jihan Wu also got into the Freeport market in Singapore. Born in Chongqing, China, through his company Bitdeer Technologies, he purchased ‘Le Freeport’, a maximum-security vault in Singapore for a reported S$40 million ($28.4 million), from aforementioned, businessman and art dealer Yves Bouvier. Also known as Singapore FreePort, it covers a total area of approximately 30,000 square meters (320,000 sq ft). It is thought that Bouvier sold to recoup money after a high-profile litigation about pricing, escalated with his former client Dmitry Rybolovlev, a young Russian oligarch. Although why he would undertake this looks alarming when the New Yorker reports “Rybolovlev spent eleven months in Russian custody after being accused of ordering the contract killing of a rival, although he was later cleared of all charges.”
Wu is a Chinese cryptocurrency entrepreneur, said to have translated Satoshi Nakamoto’s white paper into Chinese. and co-founder of Bitmain Technologies, a leading Bitcoin mining chip manufacturer. Following China’s crackdown on cryptocurrencies, it is known that some of China’s biggest crypto mining players shifted their operations overseas including Singapore.
This purchase makes sense for two reasons: the Chinese have a long history with art including renowned pieces in global museums from periods such as the Ming dynasty and according to artprice.com China was the only country among the top five powers in the art market (which accounted for 89% of the global results) to record an increase in revenue from art auction sales in 2023. Last year in Hong Kong, we also saw global news as Chinese born, Justin Sun, Founder of crypto company, Tron purchased the Maurizio Cattelan banana, duct taped to a wall for $6.2million from Sotheby’s, New York. He then ate the artwork (banana) at a press conference held in The Peninsula Hong Kong, to create Banksy type legend and value. Sun is also renowned for paying $4.5 million at a charity dinner to have lunch with Berkshire Hathaway’s chief Warren Buffett. The other, good reason could be to provide storage facilities, like in Switzerland, for bitcoin. Xapo bank, a crypto custodian, has a vault in the Swiss Alps on the site of an old military location.
Expert Views on the Future of Freeports
Dr Ariel Sergio Davidoff, Founder at Davidoff Law based in Zurich agrees with the security concept. “Freeports are places to safeguard assets with humidifiers and so on for high value paintings and strong rooms to keep them safe from harm. Additionally, they can be used as VAT- free trading places for art, carpets, and everything which is stored in them, which is currently a large volume market.”
Daniel Martineau, Non-Executive Chair of Summit Trust International, based in Geneva and Principal of Rougemont Advisors, a private client advisory firm and former Head of Trusts of Coutts Bank in Switzerland, adds his outlook. “We have always had a significant allocation to fine art in our trust portfolios. Our experience is the bigger the value, the more likely that art forms part of the investment strategy. However, often the reality is not consistent with perception. One might think that the repository for multimillion dollar masterpieces would be a plush and pampered location. Far from it. They are from the outside and inside quite non- descript warehouses. They are high security installations to be sure but not at all palatial with grey cement walls and cargo elevators. Burley men will cart around and place the art for viewing and while they may well wear white gloves and offer you a coffee, they are by no means the refined butlers found in the Ritz hotel. While most clients are interested in art as an aesthetic pursuit, they are also conscious of art as a store of value, particularly in a world that has a growing threat against fiat currencies. We see that art is on the rise as an investment. The Freeport has the benefits of security, privacy, tax effectiveness, and territorial optionality. It is easier to move between jurisdictions without triggering a tax bill.” Of whom uses Freeports Martineau adds, “I think the vast majority of clients are individuals, trusts and foundations who store for private collections.”
Pierre Valentin, Co-Head of Art Law at law firm Fieldfisher and previously Sotheby’s in-house counsel, confirms his experience in the sector, “Think of Freeports as the Swiss bank accounts of the art world: highly secure, discreet, and offering unparalleled services to art collectors. Strategically located in tax-friendly jurisdictions such as Geneva, Zurich, Luxembourg, Singapore and Delaware, these facilities, in my view, are far more than mere warehouses. They provide museum-grade climate control, state-of-the-art security and flexible logistics, ensuring that valuable artworks and collectibles are preserved, protected, and, most importantly, easily tradable, without incurring VAT or customs duties so long as the art remains inside the facility. With uncertainty over tariffs in the USA, Freeports are more attractive than ever. Take Delaware, for instance: its designation as a federally recognized Foreign-Trade Zone (FTZ) allows collectors to bypass tariffs on imported artworks, making it a prime destination for collectors seeking transactions without roadblocks at customs.”
Moving onto the darker side of art, Valentin explains more on preventing abuse, “Despite their obvious attractions, Freeports have faced criticism, particularly in the wake of scandals like the Bouvier-Rybolovlev affair. Sceptics paint them as secretive strongholds where the ultra-wealthy hoard masterpieces away from public view. In response, Switzerland has introduced stricter disclosure obligations. Operators at the Luxembourg Freeport must comply with EU anti-money laundering laws. In short, Freeports aren’t the villains of the art world. They provide valuable services to collectors. If tariffs on art and collectibles became widespread, Freeports would only increase in popularity.” As to who uses them, he says, “I don’t think that there is a particular type of collector using the Freeports. It’s a broad church. One profile is the collector who cannot stop buying and runs out of space. Another is the collector who will literally set up a “private museum” in a Freeport to enjoy on occasions with friends and family. There are family offices holding art for clients in Freeports, so the art travels on loan then returns to the Freeport. There are individuals who inherit a collection then park it in a Freeport whilst they decide what to do with it. There is the investor-type who cares only about value, not the art itself. There is also the art dealing community hoarding art in the Freeports. You may recall the story of mega art dealer David Nahmad, a Lebanese billionaire, of the Nahmad family, who held a Modigliani painting in the Geneva Freeport. This came to light in 2016 through the Panama Papers leak. The painting was allegedly stolen by the Nazis from Jewish art dealer Oscar Stettiner. The Nahmad family initially denied ownership, claiming it belonged to a company called International Art Center (IAC). However, the Panama Papers revealed that IAC was controlled by the Nahmad family.”
Day-to-day management of collections
Dr. Jacqueline Nowikovsky, an art advisor based in London and Vienna and Founder and Director at N Fine Art deals, who advises on a select number of private collections, contributes her perspective. “The discreet and tax efficient nature of Freeports has given them a reputation of being a place where art goes to die, but, from a mere conservation aspect, this narrative ignores the state-of-the-art climate-control and security standards that reputable Freeports will have in place. The more important role Freeports play in my day-to-day management of collections, is that the collectors I work with often own more artworks than they can live with at one given moment. Their want to acquire masterpieces, the ongoing curiosity to discover new artists and the passion that drives a lifelong journey as a collector creates the need for very specific storage options.”
Nowikovsky continues, “Freeports can be useful when bearing in mind the fiscal implications of importing artworks to a country of residence. This doesn´t mean that these artworks will never see the light of day again. It’s our job as advisors to make works available for public loans and museum requests: serious collectors will always endeavour to support artists and institutions. The surrounding infrastructure of Freeports will often facilitate the logistics involved with such loans.”
“With regards to artworks acquired for dynamic investment purposes, Freeports are a way of reducing ancillary cost, which might otherwise reduce profit margins. They can be an important tool to arrange viewings prior to buying or selling an artwork, which again means these artworks can enter the market circuit again. This never means that clients don´t pay applicable taxes or import duties when they decide to have works installed in their homes or the times come to resell an artwork for any given reason. It may however allow time and consideration to find the right avenue.”
Finance ecosystem
Chen Chowers, Head of Operations at Overstone Art Services helps clients, including financial institutions, wealth managers, insurers, and auction houses, view and manage art as a financial asset. They have a team of finance, art, insurance, and data specialists to advise. Chowers talks about the art lending market, agreeing with the previous sentiment: “I work in art finance, specifically with art secured lending and Freeports remain a key component of the art finance ecosystem, particularly for high-value collections used as collateral in lending arrangements. A significant proportion of major collections are stored in Freeports, streamlining the securitisation process, often without the physical transfer of the artwork itself. Instead, the change is reflected in the pledge holder agreement, granting the bank first access while the work remains in situ. Beyond secure storage, the tax benefits of Freeports align with the economic rationale of art-backed loans – it helps with cashflow. Many large-scale collections are in storage facilities and collectors who decide to investigate art secured lending are typically more financially savvy. As a bit of context, these facilities are trusted with high value and important works by many collectors and institution. As this includes and impacts significant wealth and reputation, the confidentiality is seen to be part of the value proposition.”
Hong Kong and Delaware
Brooke Reese, Associate Director, Business Development, works at The Fine Art Group, who offer advisory on sales and investment, art finance and appraisals. The Fine Art Group was founded in 2001 by Philip Hoffman and was the first company to successfully launch a series of art investment funds. Reese says, “Freeports are not just storage solutions, they are strategic tools that sophisticated collectors and institutions use to enhance market agility and collection management. At The Fine Art Group, we advise clients to leverage Freeports, whether to position works for future sales, facilitate international transactions, or transition artworks into museum collections or private exhibitions. While Geneva remains a key hub globally, Hong Kong is increasingly favoured for its tax rates, and the state of Delaware has emerged as a strong U.S. alternative. The outdated notion that art goes to die in Freeports no longer holds; instead, our clients use them to maintain flexibility, manage risk, and capitalize on market opportunities. In an art world that demands agility and precision, Freeports provide not just security and discretion, but the ability to navigate an evolving global landscape with confidence.”
Multiple taxes: Income, gain and indirect taxation
Mark Cagienard, Partner and tax expert at CMS law in Zurich clarifies the tax situation, making an interesting point about different types of tax. “In terms of customs and consumption taxes, Freeports (we call it bonded warehouse) are often referred to as a “no man’s land”. While this is legally not true, for instance, Swiss Freeports are not extraterritorial locations and belong geographically and legally to Switzerland, the goods stored in the Freeports are classified as having not been introduced to Swiss territory. In other words, the Freeports have a special customs status which allows goods to be transferred across the Swiss border under a transit regime into the Freeport, without paying any customs duties or import VAT when entering the border. Also, transactions concerning the goods while they are located within the bonded warehouse do not trigger any local duties or VAT. However, once the goods are removed from the bonded warehouse, which is under special customs surveillance, the goods must either be imported to Switzerland or exported again under a transit regime to a different country; this can also be a different bonded warehouse. This exemption mechanism doesn’t carry over to taxes measured by income or gain, it’s rather connected to indirect taxes. Of course, there is a certain abuse potential in terms of secretly stowing away goods which the owner has not correctly reported to his local tax office, but this is no different to any other kind of safe deposit box.”
Who are the customers?
Cagienard shares his view on users of Freeports, “The customer can be anyone, so typically a private owner of a piece of art who will usually not deposit it in his own name but through a structure such as an offshore vehicle or a trust to retain privacy. Other types of customers, we see, are auctioneers, museums and art galleries. It’s also about the professional storage of the goods.”
Using trusts
Gregg Homan, Head of Strategic Partnership for JTC USA, Private Client Services, focuses on trust structures, tax and estate planning. Based in Delaware he says, “Traditionally, trust companies here don’t like holding art or assets that can be easily moved or destroyed. If they were an asset of the trust, we have a duty to maintain and care for that asset. If that asset is hanging in a museum or in someone’s house, we could be held liable by all the beneficiaries of the trust.” He explains, though, how trusts can be used for art assets. “In a directed trust (UK calls them reserved power trusts), there is an individual named in the trust who would direct the management of assets. This person would most likely form an entity to “own” the art as an asset of the trust. The trust would only own the entity which in turn owns the art. This design absolves the trustee from managing the art or being responsible while keeping those assets as part of the trust.”
Art on loan tax benefits
Joshua Rubenstein, Partner and National Head of the firm’s Trusts and Estates practice based in New York shares his opinion, “In my view, art Freeports can be used by people who treat art as currency, which is where the possibility of tax evasion comes in. My clients tend to want ready access to their art and treat it as cultural property destined at some point for charity. They normally have their excess art on loan, for which there can be great tax benefits, particularly from a US standpoint if held by US private foundations.”
Tax suspension, not exemption
Adriano Picinati di Torcello at Deloitte is the Global Art & Finance coordinator for the Deloitte group of member firms and has 30 years of professional experience. He is Head of Art & Finance at Deloitte Luxembourg. Picinati di Torcello shares his thinking, “There are many Freeports in the world for different categories of goods. There is also an association called the World Free Zones Organization. With art, fine wines, expensive cars, or other collectibles assets, you have only a few facilities that offer a mix of dedicated services including highly secure storage rooms, vaults and safes of various sizes, all customisable with controlled temperature and humidity, as well as in the loading and off-loading areas, showrooms, lobby, corridors and hallways and comfortable showrooms with state-of-the-art presentation equipment. Those state-of-the-art infrastructures must be in strategic locations such as for example an airport with a cargo centre in a politically and economy stable country. Contrary to the belief that art “goes to die” in Freeports, these facilities play a necessary role in preserving and transitioning art, allowing works to be loaned for exhibitions or sold through private transactions and importantly also, they operate under a regime of suspension, and not of exemption, of VAT and customs duties on goods and services.”
Insurance and packaging
Andrew Stramentov, Founder & CEO of ROKBOX based in London, who make art packaging, adds a final view, “Freeports are extremely useful for art businesses and collectors alike, their continued growth – Dubai opening soon – and attraction is a Freeport’s unique ability to anonymise trading and ownership of artworks, outside of government tax regimes view. This may sound nefarious but in truth most artworks in Freeports are held in stasis awaiting their next destination whereupon perfectly legal import taxes will be paid. The anonymity offered by Freeports is a similar core function to that which makes cryptocurrency attractive, but with physical assets. It’s no coincidence that the new owner of Singapore Freeport’s is Jihan Wu. Worryingly, with the increases in the value of art works, some locations such as Geneva have very little insurance capacity left, which means increasing insurance prices, so some of our customers are using our products within Freeport’s to protect their assets and reduce insurance costs. We built ROKBOX because of our experience of valuable artwork being damaged from avoidable instances.” ROKBOX make re-usable cases for art out of modern, toughened materials “to protect against the most common losses like water damage or forklift punctures.”
So, are Freeports simply a pragmatic solution for art storage, or do they pose a risk of enabling financial secrecy? While regulations are tightening, the demand for secure, tax-efficient storage remains high. From traditional collectors to cryptocurrency billionaires, Freeports continue to be a key player in the evolving global art market.
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Read more about art
A. A freeport is a high-security, low tax storage facility, often located in airports or specially designated economic zones, where art, wine, gold and luxury assets can be held without incurring customs duties or VAT. Items can remain there for years, untouched by local tax regimes.
A. People use freeports for three key reasons:
Privacy – ownership records are not publicly disclosed.
Tax management – works can be bought, sold or stored without import duties.
Security – controlled environments protect masterpieces from damage or theft.
This combination makes freeports ideal for treating art as an investment asset.
A. Yes. Art can change hands without ever leaving the building, which is appealing to investors who want frictionless transactions. The sale happens within the facility, avoiding import/export paperwork.
A. Typical users include:
Billionaires and family offices
Art dealers and galleries
Museums storing pieces long-term
Investors treating art as a capital asset
Wealth managers structuring succession or estate planning using art portfolios
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