Foreign-Trade Subzones may be established to extend FTZ benefits to individual manufacturing firms at their existing plant locations.
The purpose of Foreign-Trade Zones and Subzones is to stimulate international trade and create jobs and investment in the United States rather than abroad.
Grantee of FTZ #121 |
A Company should consider Foreign-Trade Zone use if any of the following conditions exist:
- Imported merchandise is subject to U.S. Customs Duty.
- Imported merchandise is to be stored for an uncertain period of time.
- Imported merchandise needs to be inspected, repaired, destroyed, repackaged, marked, or relabeled before entry into the domestic market or for re-export.
- Imported merchandise is subject to U.S. quota restrictions.
- Products are assembled, manipulated, processed, or manufactured using imported materials or a combination of imported and domestic materials.
- 6. An inverted tariff situation exists for the finished product (i.e., duty rates are higher for imported components of the finished product than they would be for the finished product itself).
- All or part of the imported merchandise will be re-exported.
- Imported merchandise is commonly displayed to potential buyers prior to purchase.
FTZ No. 121
Capital District Regional Planning Commission
One Park Place, Suite 102, Albany, NY 12205
Phone: 518-453-0850
Fax: 518-453-0586
cdrpc@cdrpc.org
http://www.cdrpc.org
Foreign-Trade Zone Status may provide some or all of the following benefits:
- Cash flow and interest expense savings related to postponement of Customs duty and excise tax payments.
- Elimination of Customs duty on items which are re-exported.
- Avoidance of Customs drawback process (i.e., applying for a rebate of previously paid Customs duty on foreign-sourced items which are re-exported).
- Inverted tariff option (i.e., selecting the lower of the raw material or the finished product duty for foreign-sourced components of goods sold domestically).
- Made in U.S.A. marking.
- Repair or destruction of defective foreign goods within the Zone.
- Expedited Customs clearance.
- Better security.
- Reduction in insurance, bond, and transportation costs.
- Avoidance of quotas (in very limited cases).
- Exhibition (Trade Mart).
- The Firm submits a petition to CDRPC with a $1,000 processing fee, which may be credited towards CDRPC charges for technical assistance in the event the firm submits a FTZ application.
- The Firm prepares an application with CDRPC assistance or using consultants.
- CDRPC submits the application to the Foreign-Trade Zones Board on behalf of the Firm. FTZ Board application fees are $4,000 for non-manufacturing or manufacturing/ processing with fewer than 3 products, and $6,000 for manufacturing/processing with 3 or more products. The normal time from application submission to Subzone activation is 12 months for manufacturing reviews.
- The FTZ Board staff conducts a preliminary review of the Subzone application.
- The FTZ Board publishes a notice of the application in the Federal Register and solicits public comments.
- The FTZ Board approves the application if all requirements are met and issues a grant of authority for the Subzone.
- The Company and CDRPC execute a Grantee-Operator Agreement, which includes an annual service fee payable to CDRPC to cover expenses involved in maintaining the Foreign-Trade Zone.
- The Company applies to the U.S. Customs Service Albany District Office for Subzone activation after a review of inventory and security systems.
- Final approval by the Customs Service and activation of Subzone operations.
If you have questions or need assistance, please feel free to
contact the Washington County LDC at 518-746-2290 or the CDRPC at 518-453-0850.
