New and Dynamic Zone Uses

forestsaintregisOil and Offshore

Nov 8, 2013 (3 years and 11 months ago)

81 views

New and Dynamic Zone Uses

Marshall V. Miller, Esq.

Miller & Company, P.C.

©2007 Miller & Company P.C

2

Major FTZ Challenges


Perception of Too Complicated to Use



Perception That It Is A Paperwork
Blizzard



Significant Time Necessary to Establish



In Some Instances Significant Costs to
Establish



Customs Compliance



3

Major FTZ Challenges


Inconsistent Customs Port Management



Necessity for Accurate Inventory Control



Opposition of Many Customs Brokers


Reduction/Elimination of Customs Entries
Means Reduction of Income



Free Trade Agreements/Duty
Suspensions



Chinese 3PL Direct Ship to Retailers


4

FY 2005 FTZ Board Annual Report

Product Trends Over the Past Three Years
(In $millions)

Category

2003

2004

2005

03 to
05 +/
-

Current
Trend

Crude Oil &
Petroleum
Products

61910

74746

129727

109.5%




Automobiles/
Motor
Vehicles/Parts

13398

19049

21368

59.4%




Pharmaceutical
& Related
Products*

2274

3275

2746

20.7%




* Denotes categories similarly titled in General
-
Purpose Zones and Subzones,
but not identical

5

FY 2005 FTZ Board Annual Report

Product Trends Over the Past Three Years
(In $millions) (continued)

Category

2003

2004

2005

03 to
05 +/
-

Current
Trend

Computers/Office
Equipment &
Related Parts

490

1489

2296

368.0%




Electronic
Products & Parts

2351

2836

1901

-
19.1%




Chemicals*

519

813

1170

125.4%




Machinery/
Equipment &
Supplies

1519

1049

1148

-
24.4%




* Denotes categories similarly titled in General
-
Purpose Zones and Subzones,
but not identical

6

FY 2005 FTZ Board Annual Report

Product Trends Over the Past Three Years
(In $millions) (continued)

Category

2003

2004

2005

03 to
05 +/
-

Current
Trend

Audio Video
Equipment &
Supplies*

804

903

1101

36.9%




Ship Parts &
Related
Equipment*

162

1199

985

508.0%




Home
Appliances/
Furnishings &
Related Parts*

242

359

910

276.0%




* Denotes categories similarly titled in General
-
Purpose Zones and Subzones,
but not identical

7

FY 2005 FTZ Board Annual Report

Product Trends Over the Past Three Years
(In $millions) (continued)

Category

2003

2004

2005

03 to

05 +/
-

Current
Trend

Juice
Concentrate

135

103

174

28.8%




Apparel/Textiles
& Related
Products*

680

552

738

8.5%




Jewelry/
Watches

290

450

606

108.9%




Metal and
Mineral
Products

533

396

483

-
9.3%




Electrical
Equipment and
Related Parts

95

279

175

84.2%




* Denotes categories similarly titled in General
-
Purpose Zones and Subzones,
but not identical

8

FY 2005 FTZ Board Annual Report

Product Trends Over the Past Three Years
(In $millions) (continued)

Category

2003

2004

2005

03 to
05 +/
-

Current
Trend

Tobacco**

140

192

161

15.0%




Toiletries/
Cosmetics &
Related Products

271

253

129

-
52.3%




Satellite Parts**

0

0

125




Liquor**

145

149

112

-
22.7%




Photo Optical
Equipment &
Supplies**

308

102

93

-
69.8%




**Denotes categories listed in either General
-
Purpose Zones or Subzones, but
not in both

9

FY 2005 FTZ Board Annual Report

Product Trends Over the Past Three Years
(In $millions) (continued)

Category

2003

2004

2005

03 to
05 +/
-

Current
Trend

Vacuum
Fluorescent
Displays**

94

93

90

-
4.2%




Bearings**

3

52

62

1966.0%




Miscellaneous

5

32

54

980.0%




Steel

79

48

37

-
53.1%




Sporting Goods/
Recreational
Equipment**

76

84

33

-
56.5%




**Denotes categories listed in either General
-
Purpose Zones or Subzones, but
not in both

10

FY 2005 FTZ Board Annual Report

Product Trends Over the Past Three Years
(In $millions) (continued)

Category

2003

2004

2005

03 to
05 +/
-

Current
Trend

Other Food
Products**

45

78

24

-
46.6%




Plastic*

12

15

20

66.6%




Medical
Equipment &
Supplies**

47

27

13

-
72.3%




Sugar**

5

4

6

20.0%




**Denotes categories listed in either General
-
Purpose Zones or Subzones, but
not in both

* Denotes categories similarly titled in General
-
Purpose Zones and Subzones,
but not identical

11

2005 FTZ Board Annual Report

Top 10 FTZ Product Increases

Category

Aggregate %


2003

2005



Bearings

1966.0%


3 62

Ship Parts & Related Equipment


508.0%


162


985

Computer Equipment


368.0%


490 2,296

Home Furnishings


276.0%


242 910

Chemicals


125.0%


519 1,170

Crude Oil & Petroleum Products


109.5%

61,910 129,727

Jewelry/Watches


108.9%


290 606

Electrical Equipment


84.2%


95 175

Plastic


55.6%


12 20

Audio Video Equipment


36.9%


804 1,101


12

2005 FTZ Board Annual Report

Top 10 FTZ Product Decreases

Category



Aggregate %


2003

2005


Medical Equipment & Supplies


-

72.3%


47 13

Photo/Optical Equipment


-

69.8%


308 93

Toiletries/Cosmetics



-

52.3%


271 129

Sporting Goods/Recreation Equip


56.5%


76 33

Steel





-

53.1%


79 48

Other Food Products



-

46.6%


45 24

Machinery/Equipment


-
24.4%


1,519 1,148

Liquor





-

22.1%


145 112

Electronic Products



-

19.1%


2,351 1,901

Metal & Mineral Products


-

9.3%


533 483

13

Easiest Way to Increase Existing FTZ
Use


Identify and Include All Direct Foreign
Sourced Material


Identify and Include Domestic Purchased
Merchandise that is Really Foreign
-
Sourced Merchandise


Include Duty
-
Free Merchandise


Packaging


Scrap/Waste/Obsolete


Kitting


In Bond Exports

14

Packaging



Non
-
Reusable Containers


Foil/Plastic


Pumps

15

Scrap/Waste/Obsolete


Consumer Goods


Chemicals


Glassware


Dinnerware


16

Kitting


Liquor/Glasses/
Cradle


Cosmetics


Cell Phones


Computers


Home Theatre Kits


Tool Kits


Napkins/Rings


Pen Set


Audio Rack
System


Surgical Pack


Clothing Set


Dinnerware Set


Glassware Set


17

Everybody Does It


Oil Refineries


Motor
Vehicles/Parts


Engine Production


Pharmaceutical/
Medical
Equipment
Production


Chemical
Production




Shipyards/
Offshore Drilling
Rig Production


Information
Technology


Toner Cartridges


Footwear


LME Warehouses

18

London Metal Exchange Warehouses
(42)


Baltimore, Maryland (8)


Chicago, Illinois (6)


Detroit, Michigan (4)


Long Beach, California (2)


Los Angeles, California (2)


Louisville, Kentucky (1)


New Orleans, Louisiana (16)


Owensboro, Kentucky (1)


St. Louis, Missouri (2)


19

Future Users/Uses


Expand Current
FTZ Operations


AD/CVD
Merchandise


High Duty Rate
Merchandise


Compound/
Chapter 99/
General


Downstream Oil
Processing



Auto
-
Storage/
Production


All U.S.
Distribution
Warehouses


Spare Parts
Warehouses


Returns/Repair
Operations

20

Top Twenty

Anti
-
Dumping/Countervailing Duty
Cases

Description

DOC Case Number

Country

Highest%
Rate

Hand trucks

A
-
570
-
891

China

383.6

Fresh garlic

A
-
570
-
831

China

376.67

Carbon steel wire
rod

A
-
841
-
805

Moldova

369.1

Natural bristle paint
brushes

A
-
570
-
501

China

351.92

Saccharin

A
-
570
-
878

China

329.33

Roasted in
-
shell
pistachios

C
-
507
-
601

Iran

317.89

Pure magnesium
(granular)

A
-
570
-
864

China

305.56

21

Top Twenty

Anti
-
Dumping/Countervailing Duty
Cases (continued)

Description

DOC Case Number

Country

Highest%
Rate

Chlorinated
Isocyanurates

A
-
570
-
898

China

285.63

Certain artist
canvas

A
-
570
-
899

China

264.09

Certain lined paper

A
-
570
-
901

China

258.21

Silicomanganese

A
-
834
-
807

Kazakhstan

247.88

Hot
-
rolled carbon
steel flat products

A
-
834
-
806

Kazakhstan

243.46

Steel concrete
reinforcing bar

A
-
841
-
804

Moldova

232.8

Crawfish tail meat

A
-
570
-
848

China

223.01

22

Top Twenty

Anti
-
Dumping/Countervailing Duty
Cases (continued)

Description

DOC Case Number

Country

Highest%
Rate

Frozen or canned
warm water shrimp
and prawns

A
-
570
-
893

China

217.94

Foundry coke

A
-
570
-
862

China

214.89

Honey

A
-
570
-
863

China

212.39

Forged stainless
steel flanges

A
-
533
-
809

India

210

Preserved
mushrooms

A
-
570
-
851

China

198.63

Crepe paper

A
-
570
-
895

China

198.08

23

Top HTS Specific Duty Rates

Product



Rate Range

Leaf Tobacco


$5.48 per kg

Broomcorn



$4.95/t

Cotton Card Strips


$1.079 per kg. to $3.159 per

Watches



$1.75 ea to $2.28 ea

Cheeses



$2.269 per kg

Butter substitutes


$1.996/kg

Cigars, Cheroots , and Cigarillos

$1.89 per kg

Fat and Oils Derived from Milk

$1.865 per kg

Grapes, fresh, if entered from


July 1 through Feb. 14
th


$1.8/m3

Flowers bulbs/pips


$1.44/1000



24

High Duty Rates


Chapter 99

Product

Duty % Rate

Gin/Brandy/White Wine

200.0%

Cheeses

200.0%

Carrots

200.0%

Pork Ham

200.0%

Olives

200.0%

Peanuts

54.6%

ADP Machine

100.0%

TV Receiver

100.0%

Rotary Drill

100.0%

Ukraine Goods

100.0%

French Goods

100.0%

EC Goods

100.0%

Articles the Product of Japan

40.0%

25

General Product Duty Rates

Product

Rate Range

Rate Type

Footwear

$0.62/pair + 13%
-
to
-

$0.90/pair
+ 37.5%

Compound Rate

2.5%
-
to
-

48%

Ad valorem

Apparel

free
-
to
-

$0.617/kg +16%

Compound Rate

16%
-
to
-

28.6%

Ad valorem

Gloves

free
-
to
-

$0.312/kg +7%

Compound Rate

2.8%
-
to
-

23.5%

Ad valorem

Luggage

5.7%
-
to
-

20%

Ad valorem

Porcelain/China

.7%
-
to
-

28%

Ad valorem

Drinking Glasses

3%
-
to
-

28.5%

Ad valorem

26

2007 Wild Card

Free Trade Agreements










2006 Imports

Korean Free Trade Agreement


$ 45,829,578,469


Potential Future FTA’s





Japan FTA





$148,091,153,702


EU FTA





$332,130,840,377


List of Other Major Exporters to U.S.


Canada (NAFTA)




$303,416,249,743


Mexico (NAFTA)




$198,258,638,178


Taiwan





$ 38,214,770,347


China





$287,772,785,927

27

Free Trade Agreements Impact



Free Trade Agreements



Import Value



Australia




$ 3,134,246,743

Bahrain






$ 46,688,026

Chile






$ 5,486,187,474

DR
-
CAFTA (Incl. DR
-
CAFTA+)



$ 3,928,750,682

Israel






$ 2,767,814,258

Jordan





$ 309,057,854

Morocco




$ 115,866,351

NAFTA (CA & MX)



$276,881,729,699

Singapore




$ 868,855,705

2006 U.S. FTA Import Value


$293,539,196,792


2006 Total Import Value


$1,855,119,254,218


FTA as a Percent of Total


15.7%




28

Duty Suspensions


1995


World Trade Organization


Congressional Agreement


No More
Duty Suspensions



Miscellaneous Trade & Technical Act of
2000


169 New Duty Suspensions & Reductions


19 Extensions



Miscellaneous Trade & Technical
Corrections Act of 2004


330 New Duty Suspensions & Reductions


5 Extensions






29

Duty Suspensions (continued)



Tax Relief & Health Care Act of 2006


348 New Duty Suspensions


34 Reductions


138 Extensions



Duty Savings must be under $500,000
per year



No Chapter 99 Census Records



30

Published Article




Western retailers shift their supply chain tasks to China


By Robert Wright in Shanghai


Published: March 27 2007 03:00 | Last updated: March 27
2007 03:00


Retailers and consumer goods companies in the
developed world are increasingly shifting logistics
operations from their home countries to China.


Goods are sorted, labelled and even placed in displays for
direct shipment to individual stores before leaving
Chinese ports.


Shipping lines, logistics companies and warehouse
operators say costs spur customers to move the sorting
process away from consuming countries, continuing the
outsourcing trend to lower wage economies that began
with manufacturing going to China.


The process is known as "distribution centre bypass"
because it cuts out distribution centres in the destination
country.


© 2007 The Financial Times Ltd.

31

Summary


Major FTZ Challenges


FTZ 2005 Annual Report Material
Increases/Decreases


Easiest Way to Increase Existing FTZ Use


Future Users/Uses


Free Trade Agreements/Duty
Suspensions


Chinese 3PL’s