12/22/2008 — Master site admin
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As you visit this site you will find pieces of information that you may want to add to a Custom Profile. To do that simply click the "add" link that is associated with that information. Once you are finished gathering data simply click "View Custom Report" and that will take you directly to your report. From there you can email, print or create a PDF of that report.
Foreign Trade Zone
A foreign-trade zone is a designated site licensed by the Foreign-Trade Zones (FTZ) Board at which special customs procedures may be used. These procedures allow domestic activity involving foreign items to take place prior to formal customs entry. Duty-free treatment is accorded items that are re-exported and duty payment is deferred on items sold in the U.S. market, thus offsetting customs advantages available to overseas producers who compete with producers located in the United States. Subzones are special-purpose zones, usually at manufacturing plants. A site which has been granted zone status may not be used for zone activity until the site has been separately approved for FTZ activation by local U.S. Customs and Border Protection (CBP) officials, and the zone activity remains under the supervision of CBP. FTZ sites and facilities remain within the jurisdiction of local, state or federal governments or agencies.
General-purpose zones are usually located at ports or industrial parks. They must be opened to multiple zone users. Although manufacturing is permitted within general-purpose zones, the most common activity use is for warehouse and distribution activity.
Subzones are special-purpose zones, usually at manufacturing plants. A subzone of a general- purpose zone can be approved if the company is unable to relocate existing facilities into a general-purpose zone site. Subzones are approved for use by one company for a specific activity. Applications for subzone status must demonstrate a significant public benefit for approval.
The Katy Area has a subzone at the Academy Sports and Outdoors Facility at Mason Road and Franz Road.
Activity Permitted in Zones
Merchandise in a zone may be assembled, exhibited, cleaned, manipulated, manufactured, mixed, processed, relabeled, repackaged, repaired, salvaged, sampled, stored, tested, displayed and destroyed.
Manufacturing, processing and any activity that results in a change of the tariff classification must be specifically approved by the FTZ Board. Retail trade is prohibited in zones.
Merchandise that Can be Placed in a Zone
Merchandise in a zone may be assembled, exhibited, cleaned, manipulated, manufactured, mixed, processed, relabeled, repackaged, repaired, salvaged, sampled, stored, tested, displayed and destroyed.
Manufacturing, processing and any activity that results in a change of the tariff classification must be specifically approved by the FTZ Board. Retail trade is prohibited in zones.
Benefits to a Zone User
Duty Exemption. No duties on or quota charges on re-exports.
Duty Deferral. Customs duties and federal excise tax deferred on imports.
Inverted Tariff. In situations where zone manufacturing results in a finished product that has a lower duty rate than the rates on foreign inputs (inverted tariff), the finished products may be entered at the duty rate that applies to its condition as it leaves the zone -- subject to public interest considerations.
Logistical Benefits. Companies using FTZ procedures may have access to streamlined customs procedures (e.g. "weekly entry" or "direct delivery").
Other Benefits. Foreign goods and domestic goods held for export are exempt from state/local inventory taxes. FTZ status may also make a site eligible for state/local benefits which are unrelated to the FTZ Act.