HOME         Washington County Local Development Corporation         HOME
383 Broadway, Building A, Fort Edward, New York 12828
PHONE (518) 746 2292    FAX (518) 746-2293     TDD (518) 746-2146
EMAIL   info@wcldc.org

WCLDC HOME
About Washington County
We Can Help
Your Business

Microenterprise Assistance Program
Financing
Empire Zones
Foreign Trade Zone
Warren Washington Counties IDA

Airport Industrial Park
Washington Co.
Business List
Available Properties
Links
Special Events
and Projects
Information Request Form
2007 Annual Report (pdf)
NEW Washington County Data Book (pdf)
The official site of Washington County, New York government
Send mail to:
Mark B. Galough
with questions or comments about this web site.
WCLDC
Washington County,
383 Broadway,
Fort Edward,
New York 12828

Foreign-Trade Zones

A Foreign-Trade Zone (FTZ) is a site within the United States, in or near a U.S. Customs Port of Entry, where foreign and domestic merchandise is generally considered to be in international commerce (i.e., outside of U.S. Customs territory).

Foreign or domestic merchandise may enter a Foreign-Trade Zone without a formal Customs entryor the payment of Customs duties or government excise taxes. Merchandise entering a Zone may be:

Stored Displayed Manipulated Processed Mixed
Sampled Repaired Cleaned Assembled Tested
Salvaged Destroyed Relabeled Manufactured Repackaged

If the final product is exported, no U.S. Customs duties or excise taxes are levied. If the final product is imported into the United States, Customs duties and excise taxes are due only at the time of transfer from the FTZ. The duties paid are the lower of those applicable to the final product itself orits component parts (inverted tariff option).

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.

Considerations for Using a Foreign-Trade Zone or Subzone

A Company should consider Foreign-Trade Zone use if any of the following conditions exist:

1. Imported merchandise is subject to U.S. Customs Duty.

2. Imported merchandise is to be stored for an uncertain period of time.

3. Imported merchandise needs to be inspected, repaired, destroyed, repackaged, marked, or relabeled before entry into the domestic market or for re-export.

4. Imported merchandise is subject to U.S. quota restrictions.

5. 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).

7. All or part of the imported merchandise will be re-exported.

8. Imported merchandise is commonly displayed to potential buyers prior to purchase.

Grantee of FTZ #121

CAPITAL DISTRICT REGIONAL PLANNING COMMISSION

5 Computer Drive West, 2nd Floor, Albany, New York 12205

Phone 518/453-0850 Fax 518/453-0856 E-Mail cdrpc@cdrpc.org

Web Site at http://www.cdrpc.org

Advantages of Using a Foreign-Trade Zone or Subzone

Foreign-Trade Zone Status may provide some or all of the following benefits:

1. Cash flow and interest expense savings related to postponement of Customs duty and excise tax payments.

2. Elimination of Customs duty on items which are re-exported.

3. Avoidance of Customs drawback process (i.e., applying for a rebate of previously paid Customs duty on foreign-sourced items which are re-exported).

4. 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).

5. Made in U.S.A. marking.

6. Repair or destruction of defective foreign goods within the Zone.

7. Expedited Customs clearance.

8. Better security.

9. Reduction in insurance, bond, and transportation costs.

10. Avoidance of quotas (in very limited cases).

11. Exhibition (Trade Mart).

Foreign-Trade Subzone Application Process

1. 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.

2. The Firm prepares an application with CDRPC assistance or using consultants.

3. 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.

4. The FTZ Board staff conducts a preliminary review of the Subzone application.

5. The FTZ Board publishes a notice of the application in the Federal Register and solicits public comments.

6. The FTZ Board approves the application if all requirements are met and issues a grant of authority for the Subzone.

7. 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.

8. The Company applies to the U.S. Customs Service Albany District Office for Subzone activation after a review of inventory and security systems.

9. Final approval by the Customs Service and activation of Subzone operations.