Foreign‐Trade Zones gPromote U.S. Investment, 

Manufacturing and Exports

Wednesday, 

October 13

10:45 a.m. ‐ 12:00 p.m.

Foreign-Trade Zones Promote U.S. InvestmentManufacturing & Exports

Presented By:Presented By:

Brandi HanbackManaging Director

Rockefeller Group Foreign Trade Zone ServicesVice President of Trade & Logistics

Rockefeller Group Development Corporation

October 13, 2010www.rgftz.com

bhanback@rockgrp.com

Agenda

Background on FTZsBackground on FTZsFinancial Benefits & Savings AnalysisFederal DesignationFederal DesignationActivation & OperationKey Industries & UsesKey Industries & Uses

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Background on FTZs

What is a Foreign-Trade Zone?

Physical location where U.S.-based companies import and exportA Secure Area Located in or near a Customs Port of EntryEntryLegally Outside the U.S. Customs Territory In a FTZ Merchandise may be: assembledIn a FTZ Merchandise may be: assembled, exhibited, cleaned, manipulated, manufactured, mixed, processed, relabeled, repackaged, repaired, salvaged, sampled, stored, tested, displayed,& destroyedRetail Sale is Prohibited

5

Establishment of FTZs

Foreign-Trade Zones were created through federalForeign Trade Zones were created through federal legislation in 1934 to:

Encourage and expedite U S participation in international tradeEncourage and expedite U.S. participation in international tradeFoster dealing in foreign goods imported not only for domestic consumption but also for export after combining with domestic goodsgoodsDefer payment of duties only until goods are entered into the commerce of the U.S.FTZ Designation obtained through application by Grantee to g g pp ythe U.S. Foreign-Trade Zones BoardFTZ Activation is achieved through application to local Port Director of U.S. Customs & Border Protection

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FTZ – A Trade Program

Concept unsuccessfully introduced in the U S Senate inConcept unsuccessfully introduced in the U.S. Senate in 1894

Successfully reintroduced in 1934 as part of The New Deal

H.R. 9322: “to provide for the establishment, operation, and maintenance of FTZs in ports of entry of the United States to expedite and encourage foreign commerce ”States, to expedite and encourage foreign commerce.

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Types of FTZs

General Purpose ZoneGeneral Purpose Zone Often an industrial park setting or port complex Designed as multi-purpose or for use by multiple companies 1 GPZ b i d f lti l it1 GPZ may be comprised of multiple sitesServes as the sponsoring zone for the subzone

SubzoneNormally single or specific purpose sites Often isolated manufacturing locations or dedicated distribution centerscentersOperations cannot feasibly be moved to or accommodated in a general purpose zone

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Key Statistics

Approx $692 billion in merchandise is received atApprox. $692 billion in merchandise is received at US FTZs annually (foreign and domestic)Approx. 60% value received is domestic or foreign pp gduty paidApprox. $40 billion exportedApprox. 330,000 persons are employed by firms operating under FTZ proceduresThere are over 250 approved general purposeThere are over 250 approved general purpose zones and over 450 approved subzones

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The Public/Private Partnership: GranteeGrantee

A public or private entity (port authorities, city/county p p y (p , y yeconomic developers)Serves as the public representative of the zone

jproject May operate the zone or contract the responsibility to another partyto another partySubmits applications for zone modifications and subzones to the Foreign-Trade Zones Board, a sub o es to t e o e g ade o es oa d, afederal independent agency housed within the U.S. Department of Commerce

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The Public/Private Partnership: OperatorOperator

May be a private corporation or the granteeMay be a private corporation or the granteeOperations can include warehousing, storage, transportation, distribution, and manufacturing Operators provide day-to-day oversight of zone activities that may include record keeping, marketing and providing technical expertisemarketing, and providing technical expertiseA company may choose to be the Operator of its own facility (Operator/User) orown facility (Operator/User) orContract out to a Third Party Logistics provider (3PL)FTZ Operator’s Bond holder

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The Public/Private Partnership: UserUser

Users (also known as tenants) are those persons orUsers (also known as tenants) are those persons or firms using a zone or subzone for storage, handling, or manufacturingUsers can also be operators Users include large distribution operations, manufacturers processing operations testing andmanufacturers, processing operations, testing and repair facilities, repackaging operations, etc.User is typically the Importer/ExporterUser is typically the Importer/Exporter

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FTZ Program Key Organizations

Foreign-Trade Zones Board (FTZB)g ( )Created by the FTZ Act of 1934Issues grants of authority to establish, operate, and maintain FTZsMembers consist of the Secretaries of Commerce and Treasury

Secretary of CommerceSecretary of CommerceChairman of the FTZ BoardAppoints the Executive Secretary of the BoardAndrew McGilvray is the Executive Secretary

Secretary of TreasuryCustoms carries out most duties of the Secretary of TreasuryPrepares and implements rules and regulationsAssigns necessary Customs officers to perform zone related workAssigns necessary Customs officers to perform zone related workThe Port Director oversees the zone as a representative of the BoardAs of March 1, 2003, the U.S. Customs Service became the Bureau of Customs & Border Protection under the U.S. Department of Homeland Security

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Duties of the FTZ Board

Issues grants to establish, expand, operate, and maintain Issues grants to establish, expand, operate, and maintain FTZsPrescribes rules and regulations to establish and operate zoneszonesRequires submission of reports regarding information related to zone operationsMakes an Annual Report to Congress on the operation and fiscal condition of each zoneInspects and examines the premises, operations, or p p , p ,accounts of zone grantees and operatorsRevokes the grant of any zone for willful and repeated violations of the FTZA after due notice and a hearingviolations of the FTZA after due notice and a hearing

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Executive Secretary

Chief operating official of the Boardp gRepresents the Board in all administrative, regulatory, and operational matters within its purviewInitiates recommendations to the Board for overallInitiates recommendations to the Board for overall administration of the FTZAConduct direct monitoring of zone activityMaintains custody of records files correspondence andMaintains custody of records, files, correspondence, and official seal of the BoardApproves boundary modifications with concurrence of the appropriate Port Directorappropriate Port DirectorAccepts rate schedules and determines their sufficiency under the regulations

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Role of Customs

Principal Interests and ConcernsPrincipal Interests and ConcernsControls merchandise moving to/from a zoneEnsures that all revenue is properly collectedEnsures adherence to the laws and regulations governing theEnsures adherence to the laws and regulations governing the merchandiseEnsures that merchandise has not been overtly or clandestinely removed from the zone without proper Customs permit

Port Director’s RoleOversees the zone as the Board representativeReviews port policy and comments on applicationsAssesses penalties and liquidated damagesInitiates suspension, if necessaryRecommends revocation to FTZ Board, if necessary

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Financial Benefits of FTZsFTZs

FTZs: Reduce Costs/Move Trade

Duty DeferralDuty Elimination on Exports & ScrapDuty Reduction (inverted tariff relief) for manufacturing zones onlymanufacturing zones onlyLocal Ad Valorem Tax Exemption on inventoryAdministrative savings and expedited flow due toAdministrative savings and expedited flow due to flexible Customs procedures, consolidatedreporting, reduced brokerage and government feep g g g

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Duty Deferral

Customs duty and federal excise tax paid only whenCustoms duty and federal excise tax paid only when merchandise is transferred from an FTZ to U.S. Customs territory for consumptiony p

Deferral savings can be significant particularly inDeferral savings can be significant particularly in First-In, First-Out inventory tracking environments and when implemented up and down the supply chain

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Duty Deferral—Example 1Zone to U.S. Commerce

Auto PartsDutiable at 2.5%Admitted to FTZAdmitted to FTZ

Stored in W h fWarehouse for Unlimited Time

Withdrawn from FTZ for Entry into U S CommerceEntry into U.S. Commerce2.5% Duty PaidDuty Deferral 20

Duty Deferral—Example 2Zone-to-Zone Transfer

Auto PartsDutiable at 2.5% Admitted to Zone 1

Stored in Warehouse 1 forWarehouse 1 for

Unlimited Time

Transferred to Zone 2In-Bond and Stored in Warehouse Duty Paid Upon Removal from y pZone 2 - Entry into U.S. Commerce

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Duty Elimination

Goods may be exported from a zone free of dutyGoods may be exported from a zone free of duty and federal excise tax

Goods may be destroyed in a zone without payment of duty and federal excise taxof duty and federal excise tax

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Duty Elimination/Zone to Foreign MarketZone to Foreign Market

Auto PartsDutiable at 2.5% Admitted to FTZAdmitted to FTZ

Stored in W h fWarehouse for Unlimited Time

Withdrawn from FTZ for ExportNo Duty Payment

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Duty Elimination/Destruction

PensDutiable at 0.8¢ each + 5.4%Admitted to FTZ

Received at warehouse andwarehouse and

determined to have no commercial

valuevalueDestroyed in the FTZ; no entry into commerce/ No Duty Paid

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Duty Reduction (Inverted Tariff)

With approval from the Foreign-Trade Zones Board whenWith approval from the Foreign Trade Zones Board, when merchandise is admitted into the zone, the importer may elect a zone status that requires payment of the:

Duty rate applicable to either the materials as admitted,

OR

Duty rate applicable to the finished product as removed from theDuty rate applicable to the finished product as removed from the zone, depending upon which is lower

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Duty Reduction/Inverted Tariff Wind Turbine Parts valued at $10,000Average Duty at 5%Average Duty at 5% Without FTZ$10,000 * 5% = $500 duty owedowed

Manufactured intoManufactured into Finished Wind

TurbineDutiable at 2 5%Inverted Tariff: Value of Dutiable at 2.5%parts are multiplied by duty

rate of finished product to determine duty$10 000 * 2 5% $250 d t$10,000 * 2.5% = $250 duty owed

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B2B SEAMLESS TRANSACTIONS: Reducing Supply Chain Cycle Timesg pp y y

Direct DeliveryExpedites arrival of goodsEli i t /d lEliminates exams/delays

Weekly Entry Expedites departure of goods

FTZ Activated Area:Expedites departure of goodsReduces paperwork/recordkeepingReduces MPFReduces broker fees

Weekly ExportExpedites departure of goodsReduces paperwork/recordkeepingReduces broker fees

In Gate A:Out Gate B:

Reduces broker fees

= Lower Inventory Levels 27

Hypothetical FTZ Hypothetical FTZ Savings AnalysisSavings AnalysisSavings AnalysisSavings Analysis

Hypothetical FTZ Savings:

Annual Savings Include:Annual Savings Include:

Duty on Exports/Scrap One-Time Duty Deferral on Average Foreign Inventory On-HandI t t A F i I t O H dInterest on Average Foreign Inventory On-HandInverted Tariff SavingsAd i i t ti t d t li i ti fAdministrative costs due to elimination of drawback, fewer entries, reduced merchandise processing fees lower brokerage feesprocessing fees, lower brokerage fees

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Hypothetical FTZ Savings

ASSUMPTIONS:ASSUMPTIONS:

Value of Foreign Dutiable Purchases = $25,000,000V l S bj t t I t d T iff $15 000 000Value Subject to Inverted Tariff = $15,000,000Value Not Subject to Inverted Tariff = $10,000,000

Inventory Turnover = 4 per yearInventory Turnover = 4 per yearValueless Scrap = 2%Average Duty Rate of Imported Parts = 4%Average Duty Rate of Imported Parts 4%Average Duty Rate of Finished Prod. = 2%Foreign Inventory Re-exported = 10%Foreign Inventory Re exported 10%

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Hypothetical FTZ Savings Exports/Scrapp p

Duty Owed Without FTZ Benefits:Duty Owed Without FTZ Benefits: $25,000,000 x 4% = $1,000,000

Duty Saved With FTZ Benefits:$25,000,000 x 4% x 2% (scrap) = $20,000

$25,000,000 x 4% x 10% (re-export) = $100,000

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Hypothetical FTZ SavingsOne-Time Duty Deferraly

Average Inventory On-Hand:Average Inventory On Hand:$25,000,000 ÷ 4 = $6,250,000

$$6,250,000 x 4% = $250,000

**No Duty Collected on Average On-Hand Inventory in FTZ; y g y ;$250,000 applies to first year FTZ savings only

Y l I t t S iYearly Interest Savings:$250,000 x 6% = $15,000

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Inverted Tariff Savings

$15 000 000 x 4% = $600 000$15,000,000 x 4% = $600,000Duty owed without inverted tariff

$15,000,000 x 2% = $300,000Duty owed with inverted tariffDuty owed with inverted tariff

$600 000 - $300 000 = $300,000$600,000 $300,000 $300,000

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Weekly Entry Savings Estimate

Estimated # Entries Filed Per Year: 300Estimated Amt. of Annual Broker Fees Paid: $30,000($100 per entry x 300 entries)Estimated Amt. of Annual MPF Fees Paid: $52,200( 21% f th l f t d h di f $485 t )(.21% of the value of entered merchandise or cap of $485 per entry)

Savings Analysis:Weekly entry allows for 52 entries per year/facilityWeekly entry allows for 52 entries per year/facility

52 entries x $100 per entry: $ 5,200Amount of MPF under weekly entry: $25,220Amount of MPF under weekly entry: $25,220

Potential Savings Annually Per Facility: $51,780

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Total Estimated Savings

Exports $ 100,000pScrap $ 20,000Duty Deferral/Avg Foreign Inventory On-Hand $ 250,000Interest on Avg Foreign Inventory On-Hand $ 15,000g g y $ ,Inverted Tariff Savings $ 300,000Weekly Entry Savings $ 51,780

HYPOTHETICAL FIRST YEAR SAVINGS: $721,780*HYPOTHETICAL FUTURE YEAR SAVINGS: $486,780*,

*Savings does not account for growth or zone-to-zone transfers*Savings for brokerage fees and MPF based on one facility only*Savings does not account for property tax savingsSavings does not account for property tax savings

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Other Benefits

Production equipment may be admitted, assembled, stored, q p y , , ,and tested without duty payment until use in production beginsCommingling of foreign and domestic merchandiseLower Administrative Costs Lower Security and Insurance CostsNo Time Constraints on StorageNo Time Constraints on StorageImproved Inventory Control through use of FIFO – Record Keeping Identity vs. Specific Identity (Fungibility)Improved SecurityImproved SecurityImproved ComplianceImproved Business Processes

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State and Local Ad Valorem Tax Exemptionp

Generally, tangible personal property (inventory) in FTZs is Generally, tangible personal property (inventory) in FTZs is exempt from state and local ad valorem taxesSpecifics of the exemption vary from state to stateFTZ Act (19 USC 81a as amended)FTZ Act (19 USC 81a, as amended)

Sec. 81o(e) Exemption from state and local ad valorem taxation of tangible personalproperty. Tangible personal property imported from outside the United States and heldin a zone for the purpose of storage, sale, exhibition, repackaging, assembly,distribution sorting grading cleaning mixing display manufacturing or processingdistribution, sorting, grading, cleaning, mixing, display, manufacturing, or processing,and tangible personal property produced in the United States and held in a zone forexportation, either in its original form or as altered by any of the above processes, shallbe exempt from State and local ad valorem taxation.

Principle Use of FTZ for Bona Fide Customs ReasonsPrinciple Use of FTZ for Bona Fide Customs ReasonsOverlay of Public Interest Principles

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Benefits Summary

Duty DeferralDuty Deferral

Cost SavingsCost Savingsll

Duty ReductionDuty Reduction

Duty EliminationDuty EliminationConsolidated Reporting Consolidated Reporting

(Broker Fee & MPF Savings)(Broker Fee & MPF Savings)Production Equipment SavingsProduction Equipment Savings

Direct Delivery/Weekly Entry & ExportDirect Delivery/Weekly Entry & Export

Time SavingsTime SavingsTime SavingsTime SavingsFlexible Inventory TrackingFlexible Inventory Tracking 38

Federal Designation

Type of Applications

New General Purpose Zone (multi-purpose)New General Purpose Zone (multi-purpose)Expansion of existing GPZ (major change)Boundary modification of existing GPZ (minorBoundary modification of existing GPZ (minor change)Subzone (specific purpose)Subzone (specific purpose)TIM/PAM – existing zones/pre-approved activityAlternative Site FrameworkAlternative Site Framework –Reorganizations/Expansion of Existing GPZDepending on type of application involvedDepending on type of application involved timeframe may be 1 month – 1 year for approval

Activation and OperationActivation and Operation

Activation Overview

Procedure for Activation (19 CFR 146.6)Procedure for Activation (19 CFR 146.6)Operator’s BondBackground CheckBackground CheckProcedures ManualSecuritySecurityBlueprint

Activation Process

Activation requirements and procedures:Written application to Port Director of CBPppBlueprint of area to be activatedZone procedures manual (inventory control)Written concurrence from the GranteeWritten concurrence from the GranteeGrantee/Operator Agreement & FeesBackground investigationsS it i tiSecurity inspectionFTZ Operator’s BondFTZ signageg gOther agency reporting

Activation Application

Zone Operator or Grantee makes written application toZone Operator or Grantee makes written application to the Customs Port Director where zone is located

The area to be activated may be all or any portion of the zone boundaries approved by the FTZB

Activation Application RequirementsRequirements

The application must include:The application must include:

A description of all the Zone sites covered by the p yapplicationAny operation to be conducted thereinA statement of the general character of the merchandise to be admitted

Supporting Documents

The application must be accompanied by the following:pp p y g

A blueprint of the area approved by the Board to be activated Procedures manual describing the inventory control

d d k i t ( )and record keeping system(s)The written concurrence of the Grantee

Grantee/Operator AgreementGrantee/Operator AgreementZone ScheduleAnnual Fee

Meeting with Customs

Purposes of the meeting:

IntroductionsFamiliarize Customs with the zone projectAllows Customs to explain their role and any local

li i d dpolicies and proceduresMay include a preliminary security checkMay initiate background checksMay initiate background checksMay involve preliminary discussions relating to establishing the Operator’s Bond amountg p

Additional Activation Procedures

The Port Director shall promptly notify the applicant inThe Port Director shall promptly notify the applicant in writing of the decision to approve or deny the applicationPrior to any manufacture, manipulation or destruction, the operator must file an application on Customs Form 216 with the Port DirectorThe Grantee and/or Operator shall make writtenThe Grantee and/or Operator shall make written application to the Port Director for deactivation of the zone site

Activation Approval

Upon receipt of U S Customs & Border ProtectionUpon receipt of U.S. Customs & Border Protection Port Director’s written approval of the application and acceptance of the executed bond, the zone p ,will be activated and merchandise may be admitted to the zone non duty paidMust also obtain signed permit for activity – C.F. 216 prior to initiating operationsEstablish inventory starting balances

FTZ Operator’s Bond

Assurance provided by a Surety Company that assessments against the bond will be paid to Customs (liquidated damages)Minimum bond amount is $50 000Minimum bond amount is $50,000Bond amount is set by Customs based on nature of merchandise, value, volume, duty ratemerchandise, value, volume, duty rateThis bond is in addition to the importer’s bond for operator/users

Background Investigations

Key employeesy p yMay take several months to completeBegin as early as possible

Procedures Manual

Document detailing operational procedures and systems related to the handling of zone status merchandise within the zoneIncludes receipt storage handling and withdrawalIncludes receipt, storage, handling and withdrawal procedures including reporting requirementsServes as an audit guideServes as an audit guide

Security Standards

Security measures may include:Physical measures (i e walls doors locks signage)Physical measures (i.e. walls, doors, locks, signage)Electronic surveillance and monitoring systems (cameras and alarms)(cameras and alarms)Guards and/or access control systems(key card, visitors log)( y g)C-TPAT (Customs-Trade Partnership Against Terrorism) FTZ procedures will complement C-TPAT programFTZs have been recognized by CBP as C-TPAT best practicepractice

Sample Signage

WARNING

THIS IS A U.S. FOREIGN TRADE ZONE. WHOEVER MALICIOUSLY ENTERSWITH INTENT TO REMOVE THEREFROM ANY MERCHANDISE ORWITH INTENT TO REMOVE THEREFROM ANY MERCHANDISE, ORUNLAWFULLY REMOVES MERCHANDISE FROM THE CUSTOMS & BORDERPROTECTION CUSTODY OR CONTROL SHALL BE GUILTY OF A FEDERALCRIME AND FINED UP TO $250,000, IMPRISONED NOT MORE THAN 10YEARS, OR BOTH. (18 U.S.C. 549, 3571, 659).

Inventory Control Requirements

Accounts for all merchandiseAccounts for all merchandiseProduces accurate and timely reportsIdentifies overages and shortagesIdentifies overages and shortagesProvides entry informationProvides audit trailProvides audit trail

Inventory Methods

Most commonly used method:Unique Identifier Number (UIN)

First-In, First-Out (FIFO)

Alternative methodsAlternative methodsForeign First (FOFI)Lot systemLot system

Inventory Methods

Unique Identifier Number (UIN) q ( )Controls zone merchandise by tracking through record identity rather than physical identityInventory layers are created and decremented using FIFO, FOFI, or other approved methodologyMerchandise need not be physically segregatedMerchandise need not be physically segregated

First-In First-Out (FIFO)

Merchandise withdrawn from oldest inventory layerMerchandise withdrawn from oldest inventory layer firstEach UIN receipt is a layerEach UIN receipt is a layerOperator is responsible for ensuring that FIFO principles are followedprinciples are followedHistory file shall be maintained to provide necessary details for spot checks and auditspPickers are not restricted to particular lot/shipment

Inventory Methods

Lot NumberNumber must be assigned to shipments upon admissionNumber must be marked on packages so that merchandise can be traced to a particular admission/shipmentLots are physically segregated to distinguish oneLots are physically segregated to distinguish one shipment from anotherPickers must draw from specified lot

Foreign First (FOFI)

Zone withdrawals from mixed foreign and domesticZone withdrawals from mixed foreign and domestic inventory are relieved from the foreign inventory layers until the foreign layers are exhaustedOnce foreign layers are exhausted, zone withdrawals are relieved from domestic inventory layerslayersTypically used by high percentage exporters

Record Retention Requirements

Records must be retained for 5 years after removalRecords must be retained for 5 years after removal of merchandise from the zoneReadily accessibleReadily accessible

Zone Reports

CBPF 214 AdmissionCBPF 216 ManipulationCBPF 3461/7501 Entry (Withdrawal)CBPF 7512 for IT, T&E and Zone to ZoneCensus ReportingQuarterly Harbor Maintenance Fee ReportingForeign-Trade Zones Board Annual ReportC t A l R ili ti R tCustoms Annual Reconciliation ReportOther Agency Reporting

Public Policy Objectives

Creation and maintenance of employment through theCreation and maintenance of employment through the encouragement of operations in the United States, which for Customs reasons, might otherwise have been carried on abroadabroadThe objective is furthered particularly when zones assist exporters and reexporters, and usually when goods arrive p p , y gfrom abroad in an unfinished condition for processing here rather than overseas

Source: Preamble to FTZB Regulations, 1991

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Key Industries and Usesy

Key Industries

Top industries that utilize zones:p

Consumer goods distribution: footwear, leather, gcosmetics, housewares, appliances, electronics, office supplies, watches, bicycles, textiles and apparel

Manufacturing: petroleum, electronics, machinery, chemicals, pharmaceuticals, appliances, automotive, p , pp ,

Parts distribution: automotive, electronics, machinery, etc.

65

Textiles and Apparel in FTZs

Textile and apparel quota phase-out expanded the possibility of ffeffective distribution through FTZs

Without quota restrictions, textile and apparel products can be distributed from FTZs under weekly entry procedures and no longer require “live” Customs entriesrequire live Customs entriesSome safeguard measures still exist but expansion of benefits to this industry is significantRecent apparel activity in the FTZ program:pp y p g

adidas Sales, Inc. Wolverine World Wide, Inc. Abercrombie & FitchAbercrombie & FitchVF Corporation

National Export Initiative

March 11, 2010 President Obama signed Executive Order ti NEIcreating NEI

To enhance and coordinate federal efforts to facilitate job creation through export promotiong p pA critical component of stimulating economic growth is ensuring US businesses can actively participate in international markets by increasing their exportsinternational markets by increasing their exportsImproved export performance is designed to create “good high-paying jobs”D bl t t 5Double exports over next 5 years

Trade & Economic Development

C i t t d th i k t b• Companies export to expand their market base

Companies that export tend to be multinationals and payCompanies that export tend to be multinationals and pay on average 7% higher wages than companies that do not export

Exports Support American Jobs and accounted for 12.7% of GDP in 2008

Trade & Economic Development

Companies that export must often import to be priceCompanies that export must often import to be price competitive in the global market

I ti l id f i t th t t bImporting can also provide a source of inputs that may not be available in the U.S. or is only available in limited supply

Companies that use FTZs tend to import and export

E ports from FTZs ha e do bled o er 5 earsExports from FTZs have doubled over 5 years

Percentage Growth Trend in Exports(2004 – 2008)

During the period from 2004 - 2008:FTZ exports grew from 19.2 billion to 40.5 billion dollars.

General exports grew from 814.9 billion to 1287.4 billion dollars. 70

U.S.-Based Companies Get In the Zone: Savings=CompetitivenessZone: Savings=Competitiveness

CBP Report “Import Trade Trends”CBP Report, Import Trade TrendsFiscal Year 2009 Year End Report published March

20102010“The value of shipments leaving FTZs have

increased in value over the last few years, competing with imports via truck.”

Sample FTZs Users

Shell

VOLVO CONSTRUCTION EQUIPMENT.

COMMUNITY BENEFITS

Retain existing jobs and attract new jobsCompany investment in the local communityLocal improvements to infrastructureIncreased local purchases of goods and services

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NATIONAL BENEFITS

Improved balance of trade resulting from increased exportsincreased exportsStronger economy through lower unemployment rates, higher use of U.S. products, andrates, higher use of U.S. products, and reinvestment in the United StatesEnhanced development and retention of technology due to production in the United States

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The FTZ Program Represents A Public/Private Partnership to Maintain & Attract U.S.-basedMaintain & Attract U.S. based International Trade Activity

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Questions & AnswersQuestions & Answers