Overview

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welding imageA U.S. Foreign-Trade Zone (FTZ or zone) is a site within the United States that is legally considered outside of Customs territory for the purpose of duties, so goods may be brought into the site duty-free and without formal customs entry.

The Columbus Regional Airport Authority is the Grantee of FTZ #138. It is comprised of six Magnet Sites, pre-designated land, with the main site encompassing industrial parks surrounding Rickenbacker International Airport. In addition, FTZ #138 is able to provide FTZ designation to any site located within our 25-county service area in Central Ohio.

FTZs are a tool that companies use to increase their global competitiveness and play an important role in providing a level playing field when investment and production decisions are made. They have been proven to be a successful trade program by consistently creating and retaining jobs and capital investment in the United States.

FTZs provide users with the opportunity to lower costs and boost profits through the following three duty savings benefits:

Reduce

In many cases duties are higher for parts than for finished products. Therefore, many companies enter a Foreign-Trade Zone in order to import parts duty-free, assemble a product and then be required to only pay the duty on the final product.

Eliminate

Customs duties are never paid on goods that are brought into a zone and then re-exported or scrapped. No formal entry with Customs is filed and the goods never enter the U.S. stream of commerce.

Defer

Since FTZs are outside the Customs territory of the United States, goods are not considered to be imported until they leave the zone and enter the U.S. stream of commerce. This allows a company to defer Customs duties until merchandise leaves the zone instead of having substantial monies tied up in inventory Customs duties.

Other benefits that can be realized by using a Foreign-Trade Zone include the following:

Weekly Entry

The Trade and Development Act of 2000 contains a provision permitting FTZ "Weekly Entry" procedures that can help zone users save time and money. Under Weekly Entry procedures, the zone user files only one Customs Entry per week rather than filing one Customs Entry per shipment. Customs no longer has to process an entry for each and every shipment being imported into the zone and the zone user no longer has to pay for the processing of each and every entry.

Logistical Flexibility

Goods may be transferred from U.S. ports of arrival directly to a Foreign-Trade Zone or between zones duty free. Products made overseas may be brought into a zone for storage or consolidation with other products, allowing distribution of complete shipments to customers. This not only provides flexibility but can improve supply chain velocity.

Supply Chain Security

FTZs can help a company achieve “best practices” when it comes to supply chain security.

Lower Taxes

Goods in a Foreign-Trade Zone avoid or defer federal excise taxes.