Industry Wants Re-evaluation of Foreign Trade Zones Changes

Foreign trade zones provide special customs procedures to U.S. plants engaged in international trade-related activities.
Foreign trade zones provide special customs procedures to U.S. plants engaged in international trade-related activities.

New York, N.Y., August 31, 2011 – American exporters, importers and multinational companies are urging a U.S. government panel to reconsider proposed rules changes they say would make it harder to do business through foreign trade zones in the United States, according to the United States Council for International Business (USCIB), which represents America’s top global companies and signed the appeal along with several other groups.

The business groups have asked the Foreign Trade Zones Board (FTZB), an interagency body led by the Department of Commerce, to re-open for comment a portion of proposed rules change, put forward in December 2010, that would impose more costly and burdensome treatment of goods subject to antidumping duties or countervailing duties that move through such zones.

“This policy change runs counter to the Obama administration’s National Export Policy, which aims to double U.S. exports within five years,” said USCIB President and CEO Peter M. Robinson.  “Moreover, it would force many companies to shift production from U.S. foreign trade zones to manufacturing centers overseas in order to remain competitive, thus depriving our country of valuable export-oriented jobs.”

The existing policy allows foreign trade zone users to import goods that would normally be subject to such duties, then manufacture and re-export finished goods without paying duties, so long as the finished products are not sold in the United States.  The new proposal would make such duty-free importation significantly more difficult by requiring a de facto trade remedy proceeding to determine whether the duty-free admission of these goods is in the public interest.

Mr. Robinson said industry wants the FTZB to maintain its existing policy of allowing privileged foreign-status merchandise to be exported without the payment of taxes and duties.  “The existing policy aims to prevent foreign trade zones from being used to circumvent antidumping and countervailing duties orders,” he said.  “The proposed regulation disregards the fact that such orders only apply to goods that enter for consumption in the United States, not those to be exported.”

The other groups joining USCIB in the appeal were the American Association of Exporters and Importers, American Institute for International Steel, Consuming Industries Trade Action Coalition, Emergency Committee for American Trade and National Association of Foreign Trade Zones.

About USCIB

USCIB promotes open markets, competitiveness and innovation, sustainable development and corporate responsibility, supported by international engagement and prudent regulation.  Its members include top U.S.-based global companies and professional services firms from every sector of our economy, with operations in every region of the world.  With a unique global network encompassing leading international business organizations, USCIB provides business views to policy makers and regulatory authorities worldwide, and works to facilitate international trade and investment.  More information is available at www.uscib.org.

Contact: Jonathan Huneke, USCIB
(212) 703-5043, jhuneke@uscib.org

Business letter to U.S. Foreign Trade Zone Board

More on USCIB’s Customs and Trade Facilitation Committee

More on USCIB’s Trade and Investment Committee

Staff Contact:   Jonathan Huneke

VP, Communications and Public Affairs
Tel: 212.703.5043

Jonathan Huneke is responsible for USCIB’s strategic communications, including media relations, publications, online content and high-level public events. He also manages the work of USCIB’s Marketing and Advertising Committee.
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