FOREIGN-TRADE ZONES
Helping Clients Save Money on Export and Import Activities
Copper Hill leads the nation in foreign-trade zone services — managing more FTZs than any other provider.
What is a Foreign Trade Zone?
Foreign-Trade Zones (FTZs), established under the Foreign-Trade Zones Act of 1934, are designated areas adjacent to U.S. ports of entry that offer importers and exporters a competitive advantage by reducing or eliminating customs duties, taxes, and fees. This streamlined approach to logistics not only facilitates the smoother flow of goods in and out of the U.S. but also enhances global competitiveness for American companies.
operational advantages
streamlined logistics
cost-saving opportunities
improved inventory management
simplified compliance with global trade regulations
simplified foreign-trade zone regulations
Permitted Activities within an FTZ
Within a Foreign-Trade Zone (FTZ), businesses can conduct a wide range of value-added activities, unlocking numerous possibilities. These activities include repackaging, relabeling, testing, grading, manufacturing, kitting, and salvaging goods—all without the usual duty payments. This flexibility is particularly advantageous compared to traditional imports. However, it’s important to note that retail trade is not permitted within the FTZ. Once established and approved, businesses can optimize operations and access ongoing benefits for future growth. Whether you’re distributing, manufacturing, assembling, or warehousing merchandise, the FTZ program offers unique advantages through a proven trade mechanism.
Cost Saving Advantages
Reduced Merchandise Processing Fees (MPF)
While businesses outside an FTZ must pay MPF fees for each shipment, those within can consolidate these into weekly entry filings with U.S. Customs. By consolidating entries into weekly filings, MPF fees are capped, which can lead to substantial annual savings depending on the volume of entries.
Duty Elimination & Deferral
FTZs enable duty elimination on goods that are re-exported, destroyed, or scrapped. This exemption from customs duties on such goods eliminates unnecessary costs, promoting operational efficiency and strategic inventory management.
Duty Reduction with Inverted Tariff Relief
One unique benefit of operating within an FTZ is the ability to utilize inverted tariff relief for many finished goods. With approval from the Foreign-Trade Zones Board, this provides companies the choice to pay duty on either the finished product or its individual components, depending on which is lower.
More Efficient Supply Chain
FTZs enable streamlined operations by enhancing inventory management, reducing processing times, and improving turnover rates. These operational efficiencies can greatly reduce overall costs, making FTZs integral to efficient global trade strategies.
Leveraging FTZs to Impact the Bottom Line
FTZs present a golden opportunity for companies looking to optimize their global trade operations and “level the playing field” vis-a-vis overseas competitors. But understanding that FTZs aren’t a one-size-fits-all solution is paramount. They hold the potential to save organizations substantial amounts of money, but the key lies in aligning their unique structure with your business’s specific needs.
FTZ OPERATIONS MANAGEMENT FOR ZONE OPERATORS
Your Expert FTZ Administrator
Copper Hill is a leader in FTZ administration and consulting for zone operators of simple and complex manufacturing, duty deferred warehousing, consolidation and distribution operations. Our customs consulting team members are deeply familiar with Foreign-Trade Zone Regulations and U.S. Customs & Border Protection Compliance.
Whether you have single or multiple sites, our centralized operations approach provides the following:
Performance of daily FTZ operator functions
Streamlined inventory management control and FTZ software implementation
Consistent, fully integrated management of your zone
Import and customs entry process management
Expertise in zone to zone transfers and FTZ feasibility
FTZ Benefits
Foreign Trade Zones (FTZs) offer a range of advantages to businesses engaged in international trade. By centralizing management, they streamline command chains, facilitating smoother operations. Importantly, FTZs provide duty reduction or deferral benefits for activities conducted within their warehouse, manufacturing, and modification sites, effectively lowering operational costs. Businesses operating across multiple FTZ sites benefit from reduced expenses due to consolidated management. Moreover, FTZs promote heightened customs compliance through standardized processes, ensuring efficient and compliant handling of international trade activities. This combination of benefits makes FTZs a strategic choice for businesses looking to optimize their global trade operations.
Contact Us
Your FTZ Experts
Contact the experts at Copper Hill today to learn more about how an FTZ can benefit your business. We would be happy to answer any questions you have and help get you started with this valuable business resource.