Foreign Trade Zone #238
The New River Valley Economic Development Alliance is the grantee of Foreign Trade Zone (FTZ) #238. Companies located in the 22 county/city service area of FTZ 238 can petition the Alliance to establish a subzone of FTZ #238 at their facility.
What is a Foreign Trade Zone?
A foreign trade zone is a secure and enclosed area, located near or in a Port of Entry. An FTZ is considered to be outside U.S. customs territory, so that foreign and domestic materials or merchandise may be moved into it without being subject to U.S. customs duties, until the goods enter U.S. commerce. When merchandise is removed from a FTZ, customs duties may be eliminated if the goods are then exported outside the United States. If the merchandise is formally entered into U.S. commerce, Customs duties are due at the time goods move outside the foreign trade zone.
The FTZ is operated as a public venture under the supervision of the grantee (the New River Valley Economic Development Alliance), with the U.S. Customs Service enforcing Customs Service laws.
Western Virginia's Foreign Trade Zone is a general-purpose zone (GPZ) established for multiple activities by multiple users. In instances where a firm wants foreign-trade zone status for its own plant or facility, or when the existing general-purpose zone cannot accommodate the firm's proposed activity, a subzone may be granted to companies sponsored by the grantee.
Overview of FTZ Benefits:
FTZs are areas which are geographically inside the United States, but are legally considered outside its Customs territory. Companies that operate an FTZ can benefit by:
• Duty Deferral: Users can avoid paying duties on imported merchandise until the goods are removed from the FTZ and enter in the U.S. commerce. Duty on machinery is deferred until it is put into production; there is no duty paid on re-exports or scrap.
• Inverted Tariffs/Duty Reduction: FTZ zone users can pay lower duty rates on goods produced in the zone when the finished product has a lower duty rate than the imported components and parts.
• Weekly Entries: Zone users will benefit if they file multiple Customs and Border Protection entries each week. FTZs allow the user to file this paper work once a week at a rate no higher than $485.
• No Time Constraints: Merchandise may remain in the zone indefinitely, whether or not it is subject to duty.
• Customs Compliance: Customs & Border Protection requirements and federal criminal sanctions are deterrents against theft. Cargo that is imported into FTZs have fewer incidents of loss and may result in lower insurance costs.
Please visit the website of the National Association of Foreign Trade Zones to view a comprehensive list of FTZ benefits.
FTZ Savings Calculator:
Wondering if your company could benefit from being in FTZ #238? Please click here to use a calculator to estimate your company’s potential savings from operating with foreign-trade zone status.
Overview of Application Process:
Step 1: Contact the New River Valley Economic Development Alliance (NRV Alliance)
Charlie Jewell, Executive Director
email@example.com or 540-267-0012
Step 2: Apply with the NRV Alliance
1. Site visit by the New River Valley Economic Development Alliance
2. Applicant downloads and completes the Minor Boundary Modification application
3. Applicant submit application and application fee to the NRV Alliance
4. NRV Alliance obtains concurrence from CBP-Richmond
5. NRV Alliance submits all documents to FTZ Board
Step 3: Receive approval from FTZ Board
1. Application review by FTZ Board
2. Applicant reviews and sign Operator Agreement with NRV Alliance
Step 4: Activate with U.S. Customs & Border Protection
1. NRV Alliance will notify applicant when FTZ Board has approved the site
2. CBP and approved user can now begin activation – View Manual