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Basic ftz info nov 2013

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Basic ftz info nov 2013

  1. 1. What is a Foreign Trade Zone? • Secure areas located in or adjacent to a Customs Port of Entry • Legally outside the US Customs territory – Goods in zones are considered to be part of international commerce, not domestic – It is only once goods leave the zone to enter the commerce of the US, that normal tariff and Customs regulations apply to those goods
  2. 2. FTZ Regulations • U.S. Foreign Trade Zones Act of 1934 (19 USC 81a-u) • Foreign Trade Zones Board Regulations (15 CFR Part 400) • U.S. Customs Service Regulations (19 CFR Part 146)
  3. 3. Purpose of the FTZ Program • Expedite and encourage foreign commerce • Create jobs and investment in the US that would otherwise take place overseas
  4. 4. What can be done in an FTZ? Merchandise entering a zone can be: Assembled Displayed Stored Destroyed Manipulated Sampled Manufactured Relabeled Cleaned Sampled Tested Processed Repaired Repackaged
  5. 5. What are the benefits of an FTZ? • Duty deferral • Duty reduction (inverted tariff) • Duty reduction or elimination on scrap/waste • Streamlined entry procedures – Direct delivery – Weekly entries • Reduction in merchandise processing and brokerage fees • Exemption from ad valorem taxes
  6. 6. Additional benefits • Improved Customs compliance • Lower security and insurance costs • Shorter transit time using direct delivery • No time constraints on storage • Improved inventory control • Customs interaction
  7. 7. Regulatory agencies • There are two primary agencies that regulate FTZs:  FTZ Board – Establish how FTZs are designated and authorized to activate  US Customs – Regulate the operation of FTZ once activated
  8. 8. Zone Terminology • General Purpose Zone – – – – A site or facility that provides multiple users Public warehouse Industrial park Port complex • Subzone (Special purpose zone) – Single-purpose, single company site – Typically manufacturing or large distribution operation
  9. 9. Zone Terminology • Grantee – Frequently port authorities, state/local economic development agencies – Serves as public representative of the zone project – Submit applications for zone modifications, site approvals and manufacturing authority – Responsible for monitoring the operations and status of zone use
  10. 10. Zone Terminology • Operator – Provide day-to-day oversight of zone site activities which include receipt, storage and shipping of merchandise, recordkeeping, and periodic reporting – Deals directly with Customs on day-to-day matters – Responsible for Customs compliance within the zone site
  11. 11. FTZ Participants
  12. 12. FTZ #122 • Grantee – Port of Corpus Christi • Applied in April 1984 • Approved in September 1985 • First continental zone with refinery subzones • 19 approved sites • All Port Corpus Christi property and facilities are included in the boundaries of the general purpose area
  13. 13. FTZ #122 Operators • Valero Refining • • • • • Citgo Refining Flint Hills Resources BTB Refining Sherwin Alumina TOR Minerals • International Resistive Company (IRC) • Kiewit Offshore Services • Gulf Marine Fabricators • Baker Hughes Drilling Fluids • Halliburton Energy Services • Excalibar Minerals • Gavilon Fertilizer • Port Corpus Christi
  14. 14. FTZ #122
  15. 15. Alternative Site Framework (ASF) • Adopted by FTZ Board in 2009 • Provides greater flexibility in providing zone status • Streamlines the process for getting FTZ status • Port Corpus Christi reorganized under the ASF in 2013
  16. 16. FTZ #122 Service Area