Allocated Gold Storage and Vault Placement Process

Allocated gold storage refers to the structured placement of physical bullion with a licensed third-party vault operator under a formal storage agreement. The process defines allocation, segregation, deposit and withdrawal protocols, liability parameters, and documentation generated at each control point within the physical gold sales and delivery execution model.
Allocated Gold Storage and Vault Placement Process

Legal Vaulting Structure and Account Formation

Allocated gold storage within this operating model is executed through a licensed third-party vault operator under a formal storage agreement. The vault operator establishes and maintains an allocated account in the Customer’s name, records metal in defined weight units, issues confirmations for deposits and withdrawals, and applies facility procedures to physical handling and access controls. Where engaged, vaulting is executed under a Precious Metals Storage Agreement with Brink’s Hong Kong Limited.

Allocated Account Structure (Operator Record-Keeping Layer)

  • The vault operator establishes an allocated gold account in the Customer’s name for maintaining physical custody of gold.
  • Gold balances are recorded in fine troy ounces to three decimal places (and other metals per their own unit conventions when applicable).
  • Sub-accounts may be established in the Customer’s name on request, with the account holder remaining the Customer entity.

Ownership and Physical Segregation (Asset Identification Layer)

  • Metal credited to the allocated account remains the property of the Customer at all times.
  • The vault operator maintains physical segregation of allocated metal from assets recorded for other parties.
  • The segregation model is enforced through specific identification of bars and controlled inventory handling at the facility level.

Bar List Requirements (Allocation Evidence Input)

  • Deposit and withdrawal instructions use a bar list as the primary asset identification input.
  • The bar list specifies, per bar: bar number, brand, weight, fineness, and fine/gross weight fields for gold.
  • Non-bar form instructions use seal and content descriptors where applicable.

Deposit Confirmation and Account Credit (Control Point)

  • Deposits are initiated by written notice specifying quantity and delivery date.
  • Written notice is provided at least two business days prior to the delivery date.
  • On the delivery date the facility takes possession, issues a written receipt, and credits the allocated account concurrently.

Withdrawal Authorization and Release (Control Point)

    Withdrawal:

  • Initiated by written notice specifying quantity and withdrawal date, supported by a withdrawal bar list.
  • Instructions include carrier / representative identification details required for release.
  • The facility confirms withdrawal instructions by contacting an authorized person from the Customer’s authorized persons list.
  • On the withdrawal date the facility releases metal to the designated carrier/representative and obtains a written receipt.

Liability Boundary and Transport Separation (Responsibility Boundary)

  • Vault operator liability commences when the facility takes possession and signs a receipt for the metal.
  • Vault operator liability terminates upon release to a carrier/authorized person with a receipt, or upon an account-to-account transfer entry in the facility’s record system.
  • Transportation is governed under a separate transport agreement when metal is moved by any carrier, including the vault operator or its affiliates acting as carrier.

Deposit Protocol

Deposit defines the controlled procedure through which physical gold is delivered to the licensed vault operator and credited to the allocated account maintained in the Customer’s name. The deposit protocol establishes the exact point at which physical possession transfers to the vault operator and the allocated account balance is formally updated.

Physical Delivery and Possession
Metal is delivered to the vault facility by the designated carrier. Upon arrival, the vault operator performs intake procedures in accordance with its facility protocols. Operator responsibility under the storage agreement commences at the moment the facility takes physical possession of the metal and issues a receipt. Prior to that moment, transport responsibility remains governed under the applicable transport agreement. The possession event is recorded within the operator’s internal control system.
Receipt Issuance and Account Credit
On the delivery date, the vault operator issues a written receipt confirming that the specified metal has been accepted into the facility. Concurrently, the allocated account maintained in the Customer’s name is credited in fine troy ounces. The credited quantity reflects the bar list dataset submitted with the deposit instruction and confirmed upon intake. The combination of written receipt and account credit constitutes formal allocation confirmation within the vault operator’s record system.
Documentation Generated at Deposit
Each deposit event produces a defined documentation set: • Written deposit instruction reference • Bar list dataset • Vault operator receipt confirmation • Updated allocated account balance entry These records form part of the structured evidence set supporting allocation, ownership reference, and reconciliation within the physical gold transaction execution model.
Pre-Delivery Instruction
Deposit is initiated by a written instruction submitted in advance of physical delivery. The instruction specifies the quantity of metal, the intended delivery date, and includes a detailed bar list. The bar list identifies each bar by serial number, refiner mark, gross weight, fine weight, and fineness. Written notice is provided at least two Business Days prior to the scheduled delivery date. This advance instruction allows the vault operator to prepare facility intake procedures and verify documentation prior to physical receipt. The written instruction forms part of the transaction documentation set and is retained as an allocation input record.

Allocation and Identification Mechanics

Allocation defines the point at which specific physical gold bars are identified, recorded, and linked to the allocated account maintained by the licensed vault operator. Identification mechanics determine how each bar is referenced within the operator’s record system and how ownership is evidenced within the broader physical gold transaction execution model.

Bar-Level Identification (Primary Asset Reference)

  • Each gold bar is identified by its unique bar serial number.
  • Refiner mark and fineness are recorded as part of the identification dataset.
  • Gross weight and fine weight are specified in accordance with operator recording standards.
  • The identification dataset forms the basis of the allocation record.

Allocation Record Creation (Control Event)

  • Allocation occurs when specific bars are credited to the allocated account maintained in the Customer’s name.
  • The vault operator records the bar list within its internal inventory control system.
  • The allocation record links the physical bar identifiers to the account reference.
  • The allocation event forms part of the transaction evidence set.

Segregation within Facility Controls (Physical Control Layer)

  • Allocated bars are held under a segregated control structure within the facility.
  • Segregation is enforced through controlled access procedures and inventory reconciliation protocols.
  • Allocated metal is not recorded as inventory of the vault operator.
  • Physical handling is governed by the operator’s facility procedures.

Reconciliation and Inventory Integrity (Ongoing Control)

  • Inventory reconciliation is performed under the vault operator’s internal control framework.
  • Bar-level data remains consistent between allocation records and facility inventory records.
  • Any transfer between accounts is reflected as a record entry within the operator’s system.
  • Account statements reflect allocated balances in defined weight units.

Withdrawal and Release Procedure

Withdrawal defines the controlled release of allocated gold from the vault facility following a valid written instruction. The procedure establishes the point at which physical possession transfers to the designated carrier and vault operator responsibility terminates under the storage agreement.

Withdrawal Instruction
Is initiated by written instruction specifying quantity, withdrawal date, and a detailed bar list identifying each bar by serial number, refiner mark, weight, and fineness. The vault operator verifies that the instruction originates from an authorized person recorded on the authorized persons list. Written notice is provided at least two Business Days prior to the requested to date.
Authorization and Release Control
Prior to release, the vault operator verifies: • Identity of the authorized person • Designated carrier or collection representative • Consistency between withdrawal request and allocated account balance Release occurs only after authorization validation under the operator’s internal control procedures.
Transfer of Possession and Account Update
On the withdrawal date, the specified bars are released to the designated carrier or representative. A written receipt confirming transfer of possession is obtained. At the moment of release and receipt issuance, vault operator responsibility terminates. The allocated account balance is adjusted accordingly, and the withdrawal event is recorded in the operator’s inventory control system.
Documentation Generated at Withdrawal
Each withdrawal produces: • Written paper instruction reference • Bar list dataset • Authorization confirmation record • Release receipt • Updated allocated account balance entry

Liability Framework and Risk Allocation

The liability framework defines when vault operator responsibility begins, when it terminates, how loss is valued, and how risk is segmented across contractual layers within the allocated gold storage process.

Commencement and Termination of Liability

  • Vault operator liability commences at the moment the facility takes physical possession of the metal and issues a written receipt confirming acceptance.
  • Liability remains in effect while the metal is held within the allocated account structure at the facility.
  • Liability terminates upon release of the metal to a designated carrier or authorized representative against written receipt.
  • Liability also terminates upon an account-to-account transfer entry recorded within the vault operator’s inventory control system.
  • Responsibility during transportation is governed under a separate transport agreement, including where the vault operator or its affiliate acts as carrier under distinct contractual terms.

Maximum Liability Parameters

  • Vault operator liability is subject to facility-level maximum limits defined in the applicable storage agreement.
  • The maximum liability amount applies per facility and per day.
  • The liability cap defines the upper boundary of operator responsibility for physical loss, damage, or destruction while metal is held within the facility.
  • Liability limits operate independently of the total aggregate value of metal recorded within the allocated account.

Loss Valuation Methodology

  • In the event of verified loss, damage, or destruction of metal held in the allocated account, reimbursement is determined based on market value.
  • Market value is calculated using the spot price reference published by the London Bullion Market Association on the defined valuation date.
  • The valuation amount is multiplied by the declared fine troy ounce quantity recorded in the allocated account.
  • Valuation applies strictly to quantities recorded within the operator’s account system at the time of the loss event.

Insurance and Risk Segregation Structure

  • The vault operator maintains insurance coverage corresponding to risks assumed under the storage agreement.
  • The vault operator is not an insurer and does not underwrite market price risk or investment performance.
  • Insurance coverage applies to defined physical custody risks within contractual limits.
  • Insurance terms and exclusions are governed by the operator’s policy structure.

Responsibility Segmentation Across Layers

  • Vault operator — physical custody risk within defined facility limits.
  • Carrier — transport risk under the applicable transport agreement.
  • Insurer — coverage within policy scope and contractual limits.
  • Account holder — market price risk and jurisdictional exposure.

This segmentation defines responsibility boundaries and prevents overlap between custody risk, transport risk, insurance coverage, and market exposure within the allocated gold storage process.

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Insurance Structure and Compliance Controls

Insurance and compliance controls define how physical custody risk is insured and how regulatory obligations apply within the allocated gold storage framework. This section clarifies responsibility boundaries without expanding contractual detail.

Insurance Structure
The licensed vault operator maintains insurance coverage corresponding to the physical custody risks assumed under the storage agreement. Insurance applies to defined physical loss, damage, or destruction occurring within the facility and within contractual limits. The vault operator is not an insurer and does not underwrite market price risk, investment performance, or external jurisdictional exposure. Transportation insurance, where applicable, is governed under separate transport arrangements.
Compliance Controls
Vault operations are conducted under the regulatory framework applicable in the operator’s jurisdiction. Anti-money laundering and sanctions compliance obligations apply to account holders and to the vault operator within their respective regulatory scopes. Client identification and authorization procedures form part of the operational control framework. Account information, inventory data, and transaction records are treated as confidential under contractual and regulatory obligations.

Frequently asked questions

What does “allocated gold storage” mean?
Allocated gold storage means that specific physical gold bars are identified by serial number and recorded within an allocated account maintained in the Customer’s name by a licensed vault operator. The bars are segregated within the facility and linked to an allocation record in the operator’s inventory system.

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