Foreign Trade Zones
Nashville Area Foreign-Trade Zone
The Metropolitan Government of Nashville and Davidson County is the local grantee for the Foreign-Trade Zone (FTZ) program. FTZ's assist companies in delaying, reducing or eliminating payment of U.S. Customs duty since no duty is paid on merchandise brought into a FTZ. Merchandise in a FTZ exported outside the U.S. or transferred to another FTZ incurs no customs duty. Merchandise may also be assembled, consolidated, repackaged or otherwise manipulated while in a FTZ to reduce duty payments.
The Metropolitan Government's Foreign-Trade Zone grant also allows companies to designate a facility outside of the general-purpose zone site as a subzone. This designation allows companies to take advantage of FTZ benefits while using their own facilities. Nissan Motor Manufacturing in Smyrna is one such FTZ subzone in the Nashville area.
How A Foreign-Trade Zone May Be Used
- No bond or duty payment while goods are in the zone
- Foreign goods may be stored indefinitely
- If zone goods are exported, no duty is paid
- Foreign and domestic goods may be mixed together to produce a finished product
- Duty can be based upon rate of individual parts at a time of entry or the finished product, at your discretion
- Foreign merchandise in a zone may be: assembled; cleaned; destroyed; displayed; graded; inspected; labeled; manipulated; packed; relabeled; repacked; repaired; sold (wholesale); sorted; tested.
- Permanent or temporary exhibition of goods is permitted
- No duty is due on such goods until entering U.S. Customs territory
Quotas and other regulation
- Goods in excess of quota may be held in the zone until in compliance
- Goods not meeting certain other government agency requirements may be held until such goods meet standard
- Delay of duty payment gives cash flow advantage
- No bond is required on zone goods
- Insurance costs are reduced to value plus ocean freight
- Unacceptable goods may be repaired or discarded before assessment of duty
- Zone merchandise may be used as collateral
- Duty rates may be frozen at time of entry
- Zone goods may be exported without duty payment