A streamlined process and the widened scope of products that qualify for Foreign-Trade Zone Temporary/Interim Manufacturing Authority, make it easier to small and midsized manufacturers to take part in Foreign-Trade Zones (FTZ), according to the Foreign Trade Zone Corp.
A foreign-trade zone is a specially designated area, in or adjacent to a U.S. Customers Port of Entry, which is considered to be outside the Customs Territory of the United States. The FTZ program was created by the U.S. government to facilitate international trade and increase the global competitiveness of U.S.-based companies. According to the National Association of Foreign Trade Zones, 2004 Foreign Trade Zones in the U.S. conducted more than $317 billion in business, exported $22 billion in goods, involved 2,524 companies and provided 337,039 jobs.
Obtaining permanent FTZ Manufacturing Authority is problematic given the 8-10 month application timeframe which often exceeds the production outlook of midstream suppliers that have to alter their production within a period of weeks or months to meet their customers' needs. The new FTZ Temporary Interim Manufacturing application process helps companies that are located within existing General-Purpose Foreign-Trade Zones.
Foreign goods can be warehoused in a FTZ and U.S. import duties will not be paid until the goods leave the FTZ for the U.S. market. If the goods are re-exported, U.S. import duties do not have to be paid.
Manufacturing activities that have already been approved in Foreign-Trade Zones include: petroleum products, automobiles, pharmaceuticals, electronics, computers, ship parts, chemicals, audio video equipment, machinery, forklifts, electrical equipment, toiletries, metal and mineral products and steel, according to Mobile, Ala.-based Foreign Trade Zone Corp.
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