Print PDF

Practice Areas

New Louisiana FTZ under Consideration, Production Authority for Kentucky Zone Approved

Monday, March 17, 2014
Sandler, Travis & Rosenberg Trade Report

The Foreign-Trade Zones Board has recently taken the following actions.

New Louisiana FTZ under Consideration. The FTZ Board has received an application by the West Cameron Port Commission to establish under the alternative site framework an FTZ within Cameron Parish, Louisiana, adjacent to the Lake Charles CBP port of entry. The ASF is an option for grantees for the establishment or reorganization of zones and can permit significantly greater flexibility in the designation of new subzones or usage-driven FTZ sites for operators/users located within a grantee’s service area in the context of the standard 2,000-acre activation limit for a zone project. The applicant’s proposed service area under the ASF would be Wards 3, 4, 5 and 6 of Cameron Parish. Comments on this application may be submitted by May 16.

Production Activity for Kentucky Zone Approved. The FTZ Board has approved a notification of proposed production activity submitted by the Louisville and Jefferson County Riverport Authority, grantee of FTZ 29, on behalf of Hitachi Automotive Systems Americas Inc. for its facilities located in Harrodsburg, Kentucky. HIAMS-HK already had authority to produce various automotive components within Subzone 29F, including mass air sensors, throttle bodies and chambers, starter motors, motor/generator units, alternators, distributors, other static converters, inverter modules, rotors/stators, batteries, ignition coils, sensors and modules, fuel injectors, emissions control equipment, valves, pumps, and electronic control units for engines and transmissions. The current request adds finished products (lithium-ion hybrid battery pack assemblies, electrical power steering modules, and electronic torque, traction and transmission control modules) and certain foreign components to the scope of authority.

FTZ activity is limited to the specific foreign status components and specific finished products described in the submitted notification. Production under FTZ procedures could exempt HIAMS-HK from customs duty payments on the foreign status components used in export production. On its domestic sales, HIAMS-HK will be able to choose the duty rates during customs entry procedures that apply to lithium-ion hybrid battery pack assemblies, rotors A&B, stators A&B, electrical power steering modules, and electronic torque, traction and transmission control modules (free to 3.4%) for the foreign status inputs noted below and in the existing scope of authority. Customs duties also could possibly be deferred or reduced on foreign status production equipment.

The components and materials sourced from abroad include plastic grommets, rubber drain tubes, bushings, gaskets, lead/tin solder, parts of batteries (covers, cover assemblies, cell case assemblies, insulator covers, cells, inlet/outlet harness holders, inlet/outlet ducts), resolver rotors and battery control units (duty rates range from free to 5.3%).

To get news like this in your inbox daily, subscribe to the Sandler, Travis & Rosenberg Trade Report.

Customs & International Headlines