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VAN NUYS - 04/20/04 - The Economic Alliance of the San Fernando Valley and the Port of Los Angeles are considering a cooperative effort to create a Foreign Trade Zone (FTZ) within the Valley, according to Alliance President and CEO Bruce Ackerman.
 
The Alliance is currently distributing a survey among the Valley's importers and manufacturers "in order to determine the feasibility of an FTZ in our community," he said.

FTZs provide certain import and manufacturing companies with a number of tax advantages. In an FTZ, companies can greatly reduce import duty costs and defer or completely eliminate applicable Customs duties.

A Foreign Trade Zone is defined by federal law as a geographic area that, while located inside the US, is considered outside US Customs territory. Import duty is not paid on merchandise as it enters the Zone and duties are only assessed and paid when goods leave the Zone.

Merchandise re-exported from an FTZ is not subject to any duty payment.

In some cases, one can choose to pay duty on raw materials or final goods. Duty payment can be deferred while goods are stored within the Zone.

"Weekly Entry" allows companies to file a single Customs entry for all merchandise shipped in one week instead of filing one every shipment, while "Direct Delivery" allows the owner to take possession of merchandise immediately after it's unloaded from a ship or aircraft.

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