FTZ Foreign Trade Zone and Premier Logistics Tulsa
Do you import or export product? Have you ever wondered what a Foreign Trade Zone could do for your business in relation to cost savings?
What is a Foreign Trade Zone?
A Foreign Trade Zone (FTZ) (AKA Free Trade Zone) is a secured site within the United States where foreign imports and domestic merchandise are considered to be outside U.S. Customs territory. Goods in the zone remain in international commerce as long as they are held within the zone or until they are exported.
It is a geographic area where goods may be landed, stored, handled, manufactured, or reconfigured and re-exported under specific customs regulation and generally not subject to customs. What makes Premier Logistics unique is that we have an FTZ right here at our Terminal in Tulsa Oklahoma.
How can that benefit my business?
- Deferral, reduction or elimination of certain duties.
- Improved company cash flow (For instance, customs duties and taxes can be deferred on products or materials imported into the zone, or reduced by assembling components into final products within the zone).
- FTZ procedures allow domestic activity involving foreign items to take place prior to formal customs entry.
- Inverted Tariff (on imports). In FTZ production, imported inputs can have higher duty rates than the finished product to be entered into U.S. commerce. The FTZ Board may allow the manufacturer to apply the lower finished-product duty rate to the foreign inputs.
- Overseas companies can utilize the FTZ as an extension of their warehouse and create a point of sale domestically in the United States thus creating an advantage over the competition by shortening up the supply chain.
- Bulk shipments may be purchased economically, brought into the zone and repackaged before being marketed in the U.S.
- Duty elimination on waste, scrap and yield loss.
- Weekly entry savings.
- Duty exemption on re-exports.
What are the primary industries using Foreign Trade zones?
- Petroleum Refining
- Consumer Electronics
What are the Public Benefits?
- Help facilitate and expedite international trade.
- Help firms conduct international trade-related operations in competition with foreign facilities.
- Help attract offshore activity and encourage retention of domestic activity.
- Assist state/local economic development efforts.
- Help create and maintain employment opportunities.
Production Equipment Benefit
- Production equipment to be used in FTZ manufacturing can be brought into the zone in foreign status.
- Prior to the payment of duties, equipment can be:
- Duty on imported production equipment is not paid until the equipment is to be used for manufacturing activity.
What Activity is Permitted in Zones?
- General warehouse and distribution activity is allowed (no time limit on storage).
- Merchandise in a zone may be assembled, exhibited, cleaned, manipulated, manufactured, mixed, processed, relabeled, repackaged, repaired, salvaged, sampled, stored, tested, displayed and destroyed.
- Production activity using foreign merchandise must be authorized by the FTZ Board on case-by-case basis.
- Retail trade is prohibited in zones.
Foreign Trade Zones can be beneficial to many companies that import. Premier Logistics is here to help. Contact us today!