Until then, US Customs and Border Protection (CBP) has identified that the CBP system will not issue a 1C (Entered and released: General Examination) message for an airway BOL unless the e214 submission matches CBP’s air AMS on all of the following: bill of lading (BOL), SCAC of the importing carrier (also known as the airline code), flight number, and the estimated arrival date at the first port of arrival (not the arrival date to the zone).  Even though the original e214 was accepted and concurred, the previously mentioned elements must reflect what is in air AMS at the time of concurrence before the shipment will be fully closed.

If you encounter this problem, you can take the following actions in order to close the bill of lading:

1. Query the BOL using the ABI AMS Query functionality
2. Note the air AMS values returned for the elements being matched for bill closure: airline code, flight number, and estimated arrival date
3. Update the e214 filing to reflect the same values found in air AMS
4. Resubmit the e214, as a replacement transaction, and concur to the e214 upon authorization of the filing

The NAFTZ Automation Committee is working with CBP to develop a long term solution to this problem, including verification of these data elements during the e214 submission process.  Keep checking Foreign-Trade Zone News for updated information.

Foreign-Trade Zones (FTZs)

Who will benefit from this expo?  If you are one of the following, then you may want to consider attending:

1. Grantees can participate in sessions on giving guidance on managing change in a new and more flexible zone environment, which offers alternative ways to manage zones
2. Importers can learn how to improve US Customs and Border Protection (CBP) compliance, better manage compliance reviews and audits, and learn how to improve their supply chain
3. Operators and users will also discover how to maximize the benefits of the program and stay on top of the latest changes in automation
4. FTZ exporters will learn how to make the most of export benefits in the zones program

What will be covered during the Seminar?  The latest trade information will be offered in multiple tracks including:

• Petroleum
• FTZ Fundamentals
• Grantee
• Global Compliance & operations
• Customs Oversight of FTZs
• Operations

Stop by booths 1 & 2 to visit Integration Point and get information on FTZ Management Software as well as solutions to manage all your global trade activities.  Plus, Integration Point will be raffling off some great prizes as part of the “Find the Integration Point Stars” game.

Click here to register for the 38th Annual NAFTZ Seminar/Conference & Exhibition.

Not going this year?  Integration Point will be providing updates from the conference here on the Foreign-Trade Zone News blog as well as through our Twitter account – GlobalTradeNews.

We hope to see you there!

You may be wondering how cross-docking would work in an FTZ.  In one scenario, all cargo is brought into the Zone and received using manifest quantities.  Any damaged product is segregated and all other cargo is consolidated on trucks for transport.  Then, a weekly entry is filed for all of the cargo by the importer of record (all importers of record must be identified as Zone users).  The only function under a cross-dock FTZ that is different from today’s cross-dock is that the entry is pushed once per week, instead of individually for each shipment.

“Many foreign-trade zones are not taking advantage of all the benefits that are allowed and cross-docking is rarely thought of.  In using cross-docking for a foreign-trade zone, all goods are moved straight through the Zone site.  This means no delay and merchandise purchasing fee savings,” said Curtis Spencer, President of IMS Worldwide.

In addition to reduced handling and storage costs and improved turnaround speed, cross-docking also promotes cost savings.  Rather than paying the MPF for each individual shipment, the importer can pay the MPF on a single entry summary filed once per week to report all goods entered into the US commerce during that week.  Vendors/Importers using cross-dock FTZ save an average of $200,000 – $550,000 per year in MPF.  For example, if your zone has 100 shipping containers cross-docked per week, this is approximately $9,500 (gross) MPF that is saved weekly.  This will net approximately $350,000 saved per year.  This amount could cover all of your zone operator fees, your cross-docking expenses and give you a bonus check to boot!

For more on the benefits of participating in an FTZ, click here.

Whether this is your first Annual Board report or your tenth, the following helpful tips can make your annual reporting process easier:

• Zone reports should reflect only activity within activated portions of zones/subzones
• Zones approved prior to October 1, 2010 must submit a project status report
• Grantees must submit status reports for any inactive subzones
• Employment figures should include both direct and contract persons working within the activated area that had zone operations during the year
• In general, all data must be in a non-proprietary form
• In reporting the amount of Customs duties collected, you may use an estimate that is agreed upon by Customs officials

Do you think it will be OK if you are a little late handing your Annual Board report over to your grantee?  You may want to reconsider… failure to submit a report can be considered a violation of the FTZ Act and can result in revocation of your zone grant.

Visit the FTZ Board website for more information on electronic submission of reports, guidelines for reporting on the economic effects of zone activity and how to report figures for movement of merchandise tables.

Valuation issues can carry high penalties for all importers, especially for those who are operating FTZs.  Join Andrew Siciliano, Partner – Trade & Customs Practice at KPMG LLP, and Integration Point, Inc. for a one-hour webcast that will focus on the following areas:

• Basics of valuation – what you need to know and pay attention to
• Transfer Pricing vs. Customs Valuation – similarities and differences
• Current challenges surrounding valuation including related party transactions, first sale, and assists
• Customs interpretation – how Customs determines valuation and pricing
• Customs valuation changes – how to apply post-importation price adjustments
• Reasonable care – ensure you are exercising reasonable care in your valuation and pricing practices

Register for the ‘Customs Valuation – What It All Means’ webcast now.

There were so many questions surrounding CBP Form 7501 that last year CBP posted 7501 FAQs.  But questions on how to fill out the form remain.  So, CBP went a step further and has recently written box-by-box instructions on how to fill out the 7501.  The document provides an explanation of each box and what information should be entered.  Click here to download the 7501 instructions.  These instructions do include information about data requirements unique to 06 entries (Foreign Trade Zone Consumption entries).

Still have questions on the 7501 or FTZs in general?  Watch the on-demand webcast The ABCs of FTZs – Making US Foreign-Trade Zones Work for You.  Or check out the FTZ resources page on the Integration Point website for links to helpful sites, an FTZ glossary, and more.

The survey asks some FTZ specific questions, as well as questions related to overall global trade compliance such as:

• Automation of compliance processes
• Department involvement in managing global trade compliance
• Trade compliance improvement initiatives planned for the next year
• Fines due to trade compliance efforts
• Main challenges in improving trade compliance

All qualified participants who take the survey will receive the results for free later this year.  Click here to begin taking the survey.

Automating the global trade process will enable companies to maintain a competitive edge in their industry.  Customs is focusing more on importers of textiles and apparel and your company doesn’t want to get caught between Customs and a dishonest importer.  Any automated solution should have a firm grasp on the three C’s of global trade – compliance, content and connectivity.

The most well-known of the three C’s is compliance because it is the focus of most software solutions.  The second C – content – deals with real-time trade content.  Trade data should be continually updated and those results should be sent to you automatically.  The solution should be able to query the current list of HTS numbers in Customs’ ABI system to determine if product information is accurate.  The third C – connectivity – is most often overlooked.  Zone operators should be connected to government agencies through their GTM solution to submit admission data electronically to file their own e214 directly to CBP.

With all of the solutions available, how do you find the right solution for your company?  In a recent Apparel Magazine article, Liz Connell of Integration Point, Inc., created questions that can help, separated into three areas: tools, software functionality and software implementation.  The questions deal with the risk of non-compliance, cost/benefit analysis of a software program, and upfront and long-term costs of managing and maintaining a software program.  View the article to see the full list of questions.

Software functionality is only one part of a complete GTM solution.  A good, automated tool will incorporate the three C’s of GTM into your global trade management and compliance program.  For more on the three C’s, download the Beyond Software: The Role of Content and Connectivity in Global Trade Management whitepaper by the ARC Group.

• Trade compliance automation
• Department involvement in managing global trade compliance
• Trade compliance improvement plans for the next year
• Fines due to trade compliance efforts
• Challenges faced when improving trade compliance

We encourage you to share your thoughts on global trade management in your zone by completing this Aberdeen study.  All qualified participants will receive the survey results free (a $399 value).  To begin taking the survey, click here.

In an article by American Shipper, the uses of FTZs by exporters were highlighted.  Among them is being able to re-export products from FTZs.  Companies are able to import individual components that are then used to make larger products without paying duties.  The new product can then be re-exported where they are incorporated into the finished product.

Many US oil refineries are also reaping benefits by being located in FTZs.  By being located in an FTZ, refiners can eliminate paying tariffs on products like diesel fuel, which is re-exported to markets such as Europe. Duty can be avoided on jet fuel that is shipped in bond from a zone to US airports and used to fuel an aircraft flying abroad.

Another major benefit is speed within the supply chain.  Placing foreign bonded goods in an FTZ does not require complicated warehouse entry procedures and domestic goods may be admitted with a simple packing list.

Melissa Irmen of Integration Point, Inc. was quoted in the article as saying, “If you are the owner of the goods and can show the repetitive nature of your business, you can get a benefit called ‘direct delivery’, which means you can be authorized to move your goods directly from the port to the zone and then report after the fact so you don’t have to wait at the port for approval for entry.  Some distribution facilities take advantage of that just for time-to-market purposes.”

If these benefits make you think an FTZ could be right for your company, view this educational webcast on “The ABCs of FTZs: Making Foreign-Trade Zones Work for You“.  Covered in the webcast is a brief overview of the US FTZ program, how to get your company started and what to expect in the application process.