The board’s executive secretary said companies intensively involved in re-export activities are among those seeking to benefit from the foreign-trade zones program.
The U.S. Foreign-Trade Zones Board recently has seen more applications for production and primary modifications from firms seeking to avoid duties, particularly companies involved in re-export of finished products, FTZ Board Executive Secretary Andrew McGilvray said during the National Association of Foreign-Trade Zones (NAFTZ) Legislative Summit in Washington, D.C., Tuesday.
“There are some places across the country, folks who, as far as I can tell, were spurred by some of these trade measures … to see if there are any tools available to them that could help them continue to be as competitive as possible in some of those export markets,” McGilvray said.
He mentioned Section 232 tariffs on steel and aluminum, which took effect March 23, as well as Section 301 tariffs on goods from China, which last year were rolled out in three tranches covering a total of $250 billion worth of goods in annual import value.
U.S.-based manufacturers that re-export are seeking to reap the benefit of foreign-trade zones that allow firms to not pay tariffs on goods re-exported from an FTZ, McGilvray said, as opposed to goods entered into U.S. commerce, which are subject to tariffs.
“Those are … things that over the last year we’ve seen as trends or factors that we hadn’t seen before, appearing in some of these requests — primary modifications or the production applications,” he said.
FTZ Board seeing more tariff-related applications
