E9-11421. Proposal for Changes to the Format of Annual Reports Submitted to the Foreign-Trade Zones Board

SUMMARY:

The Foreign-Trade Zones (FTZ) Board is inviting public comment on a staff proposal to revise the format of annual reports that are submitted by zone grantees to the Foreign-Trade Zones Board. The revisions are intended to clarify the information that is being requested and focus on the information that is most important for oversight of the FTZ program. For comparison, the current format for annual reports is available on the FTZ Board's Web site—accessible via http://www.trade.gov/​ftz—within the “Already in a Zone?” section. Relative to the current format, a number of multiple-part questions have been broken out into separate questions for purposes of clarity and ease of use. In general, the amount of information being requested in the proposed format is reduced relative to the existing format.

Part 1: Zone Project Summary

1. Was foreign-status merchandise stored within the zone under zone procedures during the fiscal year?

If the answer is no, complete questions 2-3 below:

2. Describe the promotion and marketing efforts that are being undertaken to provide local companies with information on using the zone?

3. Has the zone ever been used for the admission and storage of zone status merchandise? If yes, indicate when.

If the answer is yes, complete questions 4-12 of Part 1 below for all warehouse and distribution operations within the general-purpose zone and any subzones. In addition, for each general-purpose zone (GPZ) or subzone operation involved in manufacturing/processing, complete a separate Part 2 (Manufacturing/Processing GPZ and Subzone Operations).

4. Provide a summary of the warehouse and distribution activity that occurred within the zone project. Specifically discuss any developments or trends in shipments or activity and any value added activity that occurred within active zone space.

5. Discuss how the zone project contributes to the local economy and local economic development efforts, including the FTZ impact on local employment, port activity, industrial development, international trade and investment. If applicable, describe in what ways the zone has been used locally by the logistics industry and other companies to address supply chain issues.

6. The general-purpose zone served ___ zone users during the fiscal year. The number employed by zone users within activated general-purpose zone areas was ___ persons. Employment figures should include both direct and contract persons. For part time workers, please report a full time equivalent (e.g., 60 contract employees working for 6 months would equal a full time equivalent of 30 workers).

7. Activity Summary:

Provide a list of general-purpose zone sites and indicate the number of acres that are activated at each site. Also indicate if the site is subject to a time or sunset limit.

Provide a list of approved subzones and indicate the activation status of each subzone. If the subzone is active, provide the employment (direct + contract) for the subzone. If inactive, indicate if the subzone has lapsed.

8. Movement of Merchandise:

This section should include the movement of merchandise for all general-purpose and subzone operations that did not require FTZ Board manufacturing/processing authority. (There is a separate section below where manufacturing/processing operations that occurred within the general-purpose zone or any subzone will be reported individually.)

Zone reports should reflect only activity within activated portions of zones/subzones. Foreign and domestic merchandise handled within activated FTZ areas should be reported.

Merchandise in the Zone at Beginning and End of Fiscal Year

	Beginning value ($)	End value ($)
Domestic Status
Foreign Status
Total:

Merchandise received	Value ($)
Domestic Status
Foreign Status
From Other U.S. FTZ's:
Domestic Status
Foreign Status
Total:

Merchandise forwarded	Value ($)
To the U.S. Market
To Foreign Countries (Exports)
To Other U.S. FTZ's
Total:

Merchandise destroyed: $

Explanation of Discrepancies:

a. Does Beginning Inventory + Total Merchandise Received −Total Merchandise Forwarded − Merchandise Destroyed = Ending Inventory? If not, explain.

b. Is the level of Merchandise Received this year significantly different from the previous year? If yes, explain.

c. Is the Ending Inventory from the previous year equal to the Beginning Inventory for this year?

9. Main Categories of Foreign Status Merchandise Received (Top Five)

Category	Value ($)	Main countries of origin
Total:

10. Foreign Status Merchandise Received:

Nonprivileged Foreign $

Privileged Foreign $___.

11. Customs duties collected on merchandise entered from the zone during the fiscal year amounted to $___.

12. (Optional) Attachment field: You may attach any photographs of the zone or any information you feel may be useful.

Part 2: Manufacturing/Processing GPZ and Subzone Operators

A separate Part 2, questions 2—17 should be included for each manufacturing/processing operation that occurred within the general-purpose zone or any subzone. This reporting of manufacturing/processing applies to any activity requiring FTZ Board approval under the Board's regulations (15 CFR part 400). (Note that any oil refinery operations should use the oil refinery-specific Part 2 that follows this section.)

Zone reports should reflect only activity within activated portions of zones/subzones. Foreign and domestic merchandise handled within activated FTZ areas should be reported.

1. The grantee shall provide a list of each FTZ Board approved manufacturing/processing operation within the general-purpose zone or subzones, and indicate whether or not activity was conducted under zone procedures at each operation during the fiscal year. Note that separate information for questions 2-17 below is required for each active manufacturing/processing operation.

2. Site/Subzone Number.

3. Company Name.

4. Activated Acres.

5. Briefly describe the activity at the subzone/GPZ operation that is occurring under zone procedures. Have there been any changes to the activity or facilities within the past year?

6. Provide the current year's level of production ___ and the level of production approved by the FTZ Board ___.

7. Employment within the FTZ operation.

8. Is the current activity consistent with the plan that was presented to and approved by the FTZ Board (this includes the level of savings, the components that are imported and the finished products). Explain how the activity is consistent.

9. Provide an estimate for the value-added activity that takes place under zone procedures (labor, profit, overhead, etc.). One way to estimate value-added is: Value of Sales from Plant minus Value of merchandise Received at Plant. Value-added should not be included in the Movement of Merchandise figures below.

10. Explain the extent to which FTZ status has helped your facility compete with plants abroad (this includes competition with other company facilities located abroad to expand or maintain product lines in the U.S.).

11. If the manufacturing activity is subject to restriction, list the restriction(s) and describe the method of compliance.

12. Movement of Merchandise:

Merchandise in the Zone at Beginning and End of Fiscal Year

	Beginning value ($)	End value ($)
Domestic Status
Foreign Status
Total:

Merchandise received	Value ($)
Domestic Status
Foreign Status
From Other U.S. FTZ's:
Domestic Status
Foreign Status
Total:

Merchandise Forwarded	Value ($)
To The U.S. Market
To Foreign Countries (Exports)
To Other U.S. FTZ's
Total:

Merchandise destroyed: $

Explanation of Discrepancies:

a. Does Beginning Inventory + Total Merchandise Received−Total Merchandise Forwarded−Merchandise Destroyed = Ending Inventory? If not, explain.

b. Is the level of Merchandise Received this year significantly different from the previous year? If yes, explain.

c. Is the Ending Inventory from the previous year equal to the Beginning Inventory for this year?

13. Main Categories of Foreign Status Merchandise Received (Top Five)

Category	Value ($)	Main countries of origin
Total:

14. Main Categories of Merchandise Forwarded (Top Five)

Category	Value ($)
Total:

15. Foreign Status Merchandise Received:

Nonprivileged Foreign $

Privileged Foreign $

16. Customs duties collected on merchandise entered into U.S. Customs territory from the operation during the fiscal year amounted to $___.

17. (Optional) Attachment field: You may attach any photographs of the operation or any information you feel may be useful.

Part 2 for Oil Refinery Operators

Zone reports should reflect only activity within activated portions of zones/subzones.

Foreign and domestic merchandise handled within activated FTZ areas should be reported.

1. The grantee shall provide a list of each FTZ Board approved oil refinery operation within the general-purpose zone or subzones, and indicate whether or not activity was conducted under zone procedures at the subzone or GPZ site during the fiscal year. Note that separate information for questions 2-36 below is required for each active oil refinery operator.

2. Site/Subzone Number.

3. Company Name.

4. Activated Acres.

5. Activation Date.

6. Number of tanks/storage capacity in barrels.

7. Employment—direct and indirect (including contract employees).

8. List primary non-crude receipts on an average daily basis.

9. What percent of the primary non-crude receipts are sourced from abroad?

10. List primary non-NPF attributed products (fuels, lubricants, etc.).

11. The primary non-NPF attributed products account for ___% of total output.

12. Provide a description of types of customers for non-NPF products shipped from the refinery. In describing customers, do not provide customer names or specific customer information. We are seeking general information about general types or categories of customers by industry and/or by use.

13. Identify exports by product and volume.

14. List primary products produced from NPF attributed feedstocks.

15. NPF attributed products account for ___% of total output.

16. Provide a description of types of customers for petrochemical products.

17. Indicate approximate percentage of shipments that are to affiliated plants.

18. Percent of total production directly exported.

19. Percent of total production indirectly exported (if known).

20. Current rated crude distillation capacity (BPD).

21. Volume of total crude oil receipts on an average daily basis (BPD).

22. Volume of foreign crude oil receipts on an average daily basis (BPD).

23. Estimated percentage of foreign crude receipts under 25 degrees API.

24. Provide the number and date of the most recent Board Order.

25. What capacity (BPD or BPD equivalent) was approved by the Board in the above order? Grants of authority are approved for a given level of activity. In the case of oil refineries, the levels of activity are stated in terms of current rated crude distillation capacity. A plant may increase its capacity, but the level of approved zone activity for the plant remains at the level approved under the refinery's current Board Order. Significant increases in activity above Board-approved levels require an expanded authorization.

26. Is the refinery operating within the approved scope of authority? Explain.

27. Indicate how zone savings assist the company in its international competitiveness efforts (e.g., reduce operating costs, improve margins, help make exports more competitive, maintain or increase refinery capacity through processing unit upgrades or additions at U.S. refinery versus foreign refinery in a global industry).

In describing how FTZ status has affected the refinery, please give examples and anecdotal information that you feel relevant. We recognize that FTZ status may be only a contributing factor.

28. Current estimate of annual zone duty savings.

29. Describe public-type benefits (both direct and indirect) to the local and national economy. Please give specific examples. As it applies to your plant, you may describe with any or all of the following:

a. Affected domestic production employment and refinery capacity.

b. Helped to offset environmental compliance costs.

c. Helped to preserve U.S. refining capacity.

d. Contributed to increased investment in U.S. refining.

In describing industry impact, information may be presented to the FTZ Board on a company-wide or industry-wide basis (rather than from individual refineries). In this manner the accumulated impact of all of a company's facilities or the use of zone procedures in the industry as a whole may be discussed rather than on an individual basis.

30. If the operation is subject to restriction, please describe method of compliance.

31. Movement of Merchandise

Merchandise in the Zone at Beginning and End of Fiscal Year

	Beginning value ($)	End value ($)
Domestic Status
Foreign Status
Total:

Merchandise received	Value ($)
Domestic Status
Foreign Status
From Other U.S. FTZ's:
Domestic Status
Foreign Status
Total:

Merchandise forwarded	Value ($)
To The U.S. Market
To Foreign Countries (Exports)
To Other U.S. FTZ's
Total:

Merchandise destroyed: $

Explanation of Discrepancies:

a. Does Beginning Inventory + Total Merchandise Received − Total Merchandise Forwarded − Merchandise Destroyed = Ending Inventory? If not, explain.

b. Is the level of Merchandise Received this year significantly different from the previous year? If yes, explain.

c. Is the Ending Inventory from the previous year equal to the Beginning Inventory for this year?

32. Main Categories of Foreign Status Merchandise Received (Top Five)

Category	Value ($)	Main countries of origin
Total:

33. Main Categories of Merchandise Forwarded (Top Five)

Category	Value
Total:

34. Foreign Status Merchandise Received:

Nonprivileged Foreign $

Privileged Foreign $

35. Customs duties collected on merchandise entered into U.S. Customs territory from the operation during the fiscal year amounted to $___.

36. (Optional) Attachment field: You may attach any photographs of the operation or any information you feel may be useful.

Public comment on this proposal is invited from interested parties. We ask that parties fax a copy of their comments, addressed to the Board's Executive Secretary, to [phone] or e-mail comments to [e-mail]. We also ask that parties submit the original of their comments to the Board's Executive Secretary at the following address: U.S. Department of Commerce, Room 2111, 1401 Constitution Ave. NW., Washington, DC 20230. The closing period for the receipt of public comments is July 14, 2009. Any questions about this proposal should be directed to Elizabeth Whiteman at [e-mail] or [phone].

Dated: May 8, 2009.

Andrew McGilvray,

Executive Secretary.