Chapter 14 Question 5 5. What is the foreign trade zone? Check with a customhouse broker or a U.S. Customs official or do some online research to determine the advantages of a foreign trade zone over a bonded warehouse. The Foreign Trade Zone (FTZ) is a secured place authorized by the federal government, considered to be outside the customs territory of the United States. The FTZ is under the U.S. Customs supervision and control however it“ facilitates trade by reducing the effect of customs restrictions.” (Ball, 2013, p. 352) Many firms use Foreign-Trade Zones to postpone and, in the case of re-export of cargo, avoid the application of U.S. Customs laws that impose duties, taxes, bonds, quotas and certain other requirements. Domestic and foreign merchandise may be stored at the FTZ. It may be manufactured, displayed, sold, or altered in almost any way that is not prohibited by U.S. law. Some of the advantages of FTZ over a bonded warehouse are that as long as merchandise remains in FTZ, it is not subject to U.S. Customs laws governing the entry of goods into
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- Fall '13
- International Trade, U.S. Customs, foreign trade zone