E9-10814. Foreign-Trade Zone 29-Louisville, KY; Application for Subzone; Dow Corning Corporation (Silicones); Carrollton, Elizabethtown and Shepherdsville, KY

An application has been submitted to the Foreign-Trade Zones Board (the Board) by the Louisville and Jefferson County Riverport Authority, grantee of FTZ 29, requesting special-purpose subzone status for the silicone manufacturing facilities of Dow Corning Corporation (Dow Corning), located in Carrollton, Elizabethtown and Shepherdsville, Kentucky. The application was submitted pursuant to the provisions of the Foreign-Trade Zones Act, as amended (19 U.S.C. 81a-81u), and the regulations of the Board (15 CFR part 400). It was formally filed on May 1, 2009.

The Dow Corning facilities (860 employees, 385,000 metric ton capacity) consist of four sites on 768 acres in Kentucky: Site 1 (650 acres) is located at 4770 US Highway 42 East, Carrollton, Carroll County; Site 2 (88 acres) is located at 760 Hodgenville Road, Elizabethtown, Hardin County; Site 3 (9 acres) is located at 907 Peterson Drive, Elizabethtown, Hardin County; and Site 4 (21 acres) is located at 270 Omega Parkway, Suite 200, Shepherdsville, Bullitt County. The facilities are used for the manufacturing and warehousing of silanes, siloxane and silicones, primarily silicone fluids and sealants. Components and materials sourced from abroad (representing 30-35% of the value of the finished product) include: Silicon metal, methanol, silica fillers, cuprous chloride powder, methyl chloride, derivatives containing only sulfo groups, surface active agents, catalysts, organofunctional silanes and blends, acrylic polymers, polyacetal co-polymers, silicone polymers, methyl cellulose, hydrocarbons, fillers, silicates, alcohol, ketones, esters, sulfuric acid esters, acyclic amides, organo-sulfur compounds, caulking compounds, prepared binders, and silicone polymers (duty rate ranges from duty-free to 7%). The application indicates that any inputs that fall under HTSUS Headings 3204, 3206 and 3212 of the HTSUS will be admitted to the subzone in privileged foreign (PF) status (19 CFR 146.41). In addition, it is noted that Section 400.33 of the Board's regulations requires that any inputs subject to antidumping or countervailing duties, such as silicon metal, be admitted to the subzone in PF status.

FTZ procedures could exempt Dow Corning from customs duty payments on the foreign components used in export production. The company anticipates that some 20 percent of the plant's shipments will be exported. On its domestic sales, Dow Corning would be able to choose the duty rates during customs entry procedures that apply to the finished silicone products (duty rate ranges from duty-free to 6.5%) for the foreign inputs noted above. FTZ designation would further allow Dow Corning to realize logistical benefits through the use of weekly customs entry procedures. Customs duties also could possibly be deferred or reduced on foreign status production equipment. The request indicates that the savings from FTZ procedures would help improve the plant's international competitiveness.

In accordance with the Board's regulations, Elizabeth Whiteman of the FTZ Staff is designated examiner to investigate the application and report to the Board.

Public comment is invited from interested parties. Submissions (original and 3 copies) shall be addressed to the Board's Executive Secretary at the address below. The closing period for their receipt is July 7, 2009. Rebuttal comments in response to material submitted during the foregoing period may be submitted during the subsequent 15-day period to July 22, 2009.

A copy of the application will be available for public inspection at the Office of the Executive Secretary, Foreign-Trade Zones Board, Room 2111, U.S. Department of Commerce, 1401 Constitution Avenue, NW., Washington, DC 20230-0002, and in the “Reading Room” section of the Board's Web site, which is accessible via www.trade.gov/​ftz.

For further information, contact Elizabeth Whiteman at [e-mail]. gov or [phone].

Dated: May 1, 2009.

Andrew McGilvray,

Executive Secretary.