For those of you who are not familiar with the FTZ program or are considering participating in an FTZ, there is a Fundamentals track just for you.  This track will offer sessions on:

• Purpose & background of FTZs
• Conducting a Feasibility study
• Quantifying zone savings
• Successful activation, procedure manual & start up
• Examples of real life applications
• A day in the life of an Operator
• Last minute checklist before you start

Any attendee with less than three years experience is invited to attend the Newcomer Reception on Sunday night.  The informal reception will allow those new to the FTZ community to network with others.

We invite you to 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.

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During the webcast there were several questions that could not be answered due to time constraints.  As promised in the webcast, those questions and their answers from Domenick Gambardella will be posted here.

Q:  If inventory is placed in an FTZ, does it still create nexus for state income tax purposes?
A: While each state has its own rules, generally speaking a FTZ will change the nexus answer.  So if holding inventory in a particular state gives nexus, that same inventory in a FTZ would also give nexus.

Q:  Are FTZs used for heavy inventory transfers?  Is it mainly for distribution and manufacturing?  My company is mainly a service provider and import/export 1 or 2 products a week, usually not of high value, so will the FTZ really be an advantage for my company?
A: If you only have 1-2 shipments each week that are low value it may not be the right answer.  FTZ benefits are very specific to each operation so generalizing is difficult, but low value and low volume typically is not a high priority for FTZs.

Q:  If manufacturing a product or defense article controlled under the ITAR or EAR or performing “defense services” (e.g. repair) defined under the ITAR, do you have to get your license approvals from State or Commerce first before submitting the FTZ application?
A: You would need to get the necessary Government authorizations before the items are transported to the FTZs or the defense services (or other controlled technical assistance under the EAR) are provided to the foreign entity.  I do not believe there is any requirement for obtaining an export license prior to submitting the FTZ application.

Q:  Do you still submit to the Food and Drug Administration (FDA) when using a FTZ?
A: Yes, FDA approvals are still required.  There are specific processes for FDA goods and FTZs.

Q:  Are you limited to only one entry per week upon leaving the zone?
A: No, you can file as many as you want/need, but each entry requires a separate MPF calculation.

Would you like to know more about FTZs?  Still have questions?  Feel free to post your questions here using the comment box and check out these resources for more information on FTZs.  If you missed the webcast, you can view in on-demand here.

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The theme of this year’s spring seminar is “FTZs: The Key to Exports.”  NAFTZ hopes to educate the trade community on the fact that Foreign-Trade Zones (FTZ) play a large part in US exports – in fact, US exports from FTZs doubled from 2004 to 2008.

The NAFTZ Spring Seminar is designed to help you maximize the export benefits from your zone and learn the latest about the opportunities and challenges of the Alternative Site Framework (ASF) initiative, as well as FTZ automation, on which Melissa Irmen of Integration Point, Inc. will be speaking.

Other speaking sessions include:

• Export Classification & Compliance
• The CBP Trade Agenda & FTZs
• Compliance for Beginners
• Foreign Direct Investment & US Export
• FTZ Application Process

To register for the seminar, visit the NAFTZ website.

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During the webcast there were several questions that could not be answered due to time constraints. As promised in the webcast, those questions and their answers from Domenick Gambardella will be posted here.

Q:  Has it been your experience that a full-time headcount is required to run a zone?
A: Generally we assume so for initial cost/benefit purposes.  Ultimately, it may be that existing resources dedicated to customs operations may be able to absorb the bulk of the work but this is a case by case determination.

Q:  Once in the zone, what is the required timeline for recordkeeping obligations for FTZ type transactions – 2, 3 or 5 years from the date of admittance or exiting the zone?
A: Recordkeeping requirement is 5 years from “entry” (goods leaving the zone).

Q:  Our foreign suppliers use a service provider that will not deliver un-cleared freight to our facilities. How do we deal with this?
A: Assuming you are talking about “regular freight” and not courier shipments, you may need to have some additional discussions with the provider on receiving the shipments “in bond”.  That is a negotiation issue with your service provider.  Often, it is a matter of working out the details and developing an understanding for all those involved of exactly what is needed.

Q:  Have you seen benefits with leveraging multiple FTZs in multiple countries as duties are different in different countries and leveraging substantial transformation?  Has this been successful in the past?
A: The benefits of FTZs vary from country to country so each activity in each country must stand on its own from a benefit determination.  Having said that, an integrated supply chain strategy which examines each leg of the transaction with country by country planning will typically provide added benefits.

Would you like to know more about FTZs? Still have questions? Feel free to post your questions here using the comment box and check out these resources for more information on FTZs. If you missed the webcast, you can view it on-demand here.

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During the webcast there were several questions that could not be answered due to time constraints. As promised in the webcast, those questions and their answers from Domenick Gambardella will be posted here.

Q: How will the transfer between FTZs be controlled by CBP and when will goods need to be accounted for with CBP?
A: The answer depends on whether the transfer is within port or not. If within port, the process is up to local decision and can be accomplished through several means. If it is out of port, it would be handled as an in bond movement. These are fairly typical FTZ processes and are “normal course” of business.

Q: We are looking at Alternative Site Framework (ASF). There may be a resource issue with CBP covering this area. What options do we have to gain CBP approval for the boundary modifications?
A: I am assuming you mean the letter the board requires from CBP as part of the process. There is no magic answer to that question. The strategy I typically recommend is to get CBP involved early, keep them informed each step of the way, listen to their concerns and do your best to respond to them.

Q: With the FTZ process, when is the Harbor Maintenance Fee (HMF) paid? Is there an opportunity to lower HMF?
A: HMF is paid quarterly within a FTZ. There is no cap on HMF so the only “savings” is the deferral of the payment until the end of the quarter.

Q: Does your facility need to be bonded or get bonded to apply?
A: Not in a traditional sense. The FTZ Board approves the application and CBP approves activation. A FTZ operators bond is required to begin operations but that is different than bonding the facility.

Would you like to know more about FTZs? Still have questions? Feel free to post your questions here using the comment box and check out these resources for more information on FTZs. If you missed the webcast, you can view it on-demand here.

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Join us for “The ABCs of FTZs: Making Foreign-Trade Zones Work for You”, sponsored by Integration Point, Inc.  The speaker for this 1-hour educational webcast will be Domenick Gambardella, Partner at PricewaterhouseCoopers, LLC, and Past President of the National Association of Foreign-Trade Zones (NAFTZ).  Mr. Gambardella will cover the following during this one-hour webcast:

• The US FTZ program
• How to calculate operations savings
• How to get your company started with an FTZ
• What to expect in the FTZ application process

To learn more about FTZs, click here to register for the webcast.

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During the webcast there were several topics many people had questions about.  Over the next few weeks, we will be posting those questions and the answers from Virginia Thompson here.

Q:  Why is it necessary to know who is filing the bill in AMS?

A:  This is necessary because part of the BOL number is the SCAC code.  If you’re going to consider the SCAC code as part of the BOL number, then strictly speaking you don’t really have to know as long as someone tells you that BOL number with the SCAC code.  For me personally, I wouldn’t want to not know because when you know who is filing the BOL number, you can ask more intelligent questions and troubleshoot instances where you’re not getting the BOL number in a timely manner.

Q:  Which SCAC code has to be provided?  The house bill SCAC or the master level SCAC, even if there is a house bill for the shipment?

A:  You should use the SCAC for the party who is filing that BOL in AMS.  That’s why I think it is important to know who is filing in AMS.  Another thing to point out about the BOL number is that I think this is the most difficult data element.  It is the only one that you cannot have wrong when you file your ISF.  Any other date element can be filed incorrectly with CBP which isn’t good but they know you filed it and at least it’s out there.  As far as CBP is concerned, if you have the BOL wrong, you haven’t filed your ISF.

Do you have questions about ISF enforcement?  Feel free to post your questions here using the comment box.  We will be happy to reply.  Also, if you missed the webcast, you can view it on-demand here.

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Attendees will include current and potential zone users, economic developers, service providers and those interested in international business.  Tommy Berry, President, CEO and Founder of PointTrade Services will discuss how companies can use foreign trade zones to:

• Increase Cash Flow
• Save Taxes
• Improve Overall Profitability

To register, contact Laura Foor at 704.347.6580 by March 26th.

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The conference is designed to provide attendees with up-to-date information on what is happening in international trade in the areas of duty drawback, imports, exports and US foreign-trade zones (FTZ).  Being held March 8 – 10, the conference includes a broad range of topics that will be presented by experts in the field of petroleum operations and customs laws and regulations.  Session topics include export compliance, legislative issues, FTZ optimization and ACE updates, presented by Melissa Irmen from Integration Point, Inc.

For more information and to register, visit the API website.

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Can FTZ users expect to see problems with their products that are already pre-approved and uploaded into OASIS for approval on 3461?   The FDA says no – the transition should be smooth. But users should be aware of this new system and monitor their districts  when they go live so they can watch for problems with filing the 3461.  Plus with this new system, importers will be able to expedite the clearance of lower-risk cargo – but only if accurate and complete data is provided by importers and entry filers.

Additional information, including a slide presentation, can be found on the FDA website at http://www.fda.gov/ForIndustry/ImportProgram/ucm172743.htm.  Also, Domenic Veneziano, the Director of the FDA’s Division of Import Operations and Policy (DIOP), is scheduled to present on PREDICT at the Annual NAFTZ Conference in Dallas in September.

You can make sure your entry data is complete and accurate using Integration Point Global Trade Management (GTM) solutions.   From managing FTZs to providing web-based HS reference look-ups to assisting with FTA qualifications, Integration Point GTM provides a central location for all your global trade needs. For more information, visit the Integration Point website.

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