By using a Foreign-Trade Zone, a company can gain a competitive edge over foreign-based competitors. This is done through the reduction of certain operational costs that are incurred when conducting international business.
Storage and distribution. Merchandise that is admitted into an FTZ may be stored indefinitely. It may be unpacked, repacked, displayed, assembled, disassembled, sorted, graded, cleaned, relabeled or even destroyed. It may be distributed as is or combined with other foreign or domestic merchandise. Only when merchandise is taken from an FTZ into U.S. Customs territory is it subject to customs duties and quotas. If the merchandise is shipped to a foreign port, no duties or taxes are collected. Goods may also be transferred directly from one FTZ to another without being subject to Customs duties or quotas.
Manufacturing. Goods may also be manufactured in an FTZ except when specifically limited by law. Products may then be exported or sent into U.S. Customs territory. When products enter Customs territory, they are subject to Customs duties; if they are shipped to foreign points, they are not. All new manufacturing operations are subject to the approval of the Foreign-Trade Zones Board and the District Director of Customs.
Note: machinery or supplies of foreign origin used in the manufacturing process are subject to duty when admitted to an FTZ. In the particular case of imported textiles subject to quota, manufacturing is permitted only if the finished products are exported.
Status designations of merchandise. At the time merchandise is admitted into a Foreign-Trade Zone, the owner applies for one of four status designations. Firms may use this status designation to legally minimize payment of U.S. Customs duties.
There are currently 12 sites on Oahu, Maui, and Hawaii that have received FTZ designation. Of the 12 sites, three general-purpose zone sites and three special-purpose subzone sites are active. Link to Map
FTZ No. 9 is headquartered at Pier 2 on 7 paved acres including 300,452 square feet of covered space in Honolulu Harbor. The pier and terminal facilities can accommodate four ships simultaneously.
The Zone is in the heart of Downtown Honolulu, just five miles from Honolulu International Airport, making international shipment of goods convenient and economical. (Cargo unloaded at the airport-or anywhere within the port of Honolulu-maintains its foreign identity and duty-free status when it is transferred to Zone No. 9 by bonded carrier).
FTZ No. 9’s expansion sites on Oahu include: 1,051 acres in Campbell Industrial Park in Ewa, 109 acres in Mililani Technology Park in central Oahu, the Hawaii Convention Center, aircraft fueling facilities at Honolulu International Airport, and Unicold’s cold storage complex.
FTZ No. 9’s expansion sites on the neighbor islands include 59 acres in Maui Research and Technology Park, Kihei, Maui; 31 acres on the island of Hawaii adjacent to Hilo International Airport, and the Natural Energy Labs of Hawaii Authority (NELHA) area adjacent to the Kona airport.
Three active special-purpose subzones are situated throughout the State of Hawaii where petroleum refining and synthetic natural gas production create products for the domestic and export markets.