1. Foreign Trade Zones & the Managing Partner of Luxury Law Group
MIASF Subzone
By Danielle J. Butler
Managing Partner of Luxury Law Group

2. WHAT IS A FOREIGN-TRADE ZONE?
Sites within the US that are considered to be outside the U.S. Customs territory where foreign and domestic merchandise is considered to be in international commerce
Companies that operate in foreign trade zones can defer, reduce, or eliminate Customs Duties on foreign products
Merchandise can enter A FTZ duty free and w/o a formal Customs entry
WHO BENEFITS?
Companies that import foreign merchandise
Companies that export imported merchandise
Marinas and shipyards
Manufacturers
Third party logistics providers
Large distribution and retail companies

3. What Activity is Permited in FTZ?
Merchandise in a FTZ may be assembled, exhibited, cleaned, manipulated, mixed, processed, relabeled, repackaged, repaired, salvaged, sampled, stored, tested, displayed and destroyed
Manufacturing and processing activity must be specifically approved by the FTZ Board
Retail trade is prohibited in activated zone space

4. BENEFITS OF THE FOREIGN TRADE ZONE
1. DUTY ELIMINATION:
All items for re-exports (never enter US Commerce)
Components are brought into the FTZ under a bond
Duty rates on components may vary according to the commodity
Assembly of component onto a Vessel which changes the Harmonized Code of the component and the component now becomes part of the Vessel
Upon departure from FTZ, the Vessel is exported from the US and so no duty is levied on the component

5. BENEFITS OF THE FOREIGN TRADE ZONE
2. DUTY DEFERRAL
Component enters the FTZ Duty free
Duty is paid when the component leave the FTZ and enters US commerce
Leads to significantly enhanced cash flow
3. DUTY REDUCTION / INVERTED TARIFF
Components are brought into the FTZ under bond
Duty rates on components may vary according to the commodity
Assembly combines the component into the product which changes the Harmonized Code of the component
The new Duty Rate is the one for the product (Vessels pay 1.5% duty)

6. What is New with FTZs In 2017 MIASF created an FTZ Subzone
In March 2013, Broward inaugurated FTZ #241 organized under a new process called ASF (Alternate Site Framework) allowing the FTZ status to be brought to any company in the permitted area that can comply with the regulations…so now the FTZ comes to you!
CBP will only approve a FTZ Site when the site has the ability to communicate electronically with Customs 24/7 and issue paperless documentation
Most sites can be up and operating in days from the time they start the process
In 2017 MIASF created an FTZ Subzone
To date, 19 FTZ have been approved in the MIASF Subzone within Broward County with a total of over 8 million square feet of warehousing space.

7. How do Foreign Trade Zones Benefit The Marine Industry
Reduce/eliminate importation costs
You can move a Vessel for up to 4 months without paying import duties
Show a foreign flagged Vessel to US Citizens
Allows you to perform repairs and add value to merchandise while under bond in a FTZ without paying Sales and Excise Taxes.
Allow you to handle products not permitted to import in the United States due to EPA and/or other agency restrictions
Save all duties payable at importation if the Vessel is registered foreign
Job creation/retention
Capital investment opportunities
To defer payment of duties until goods enter into the commerce of the U.S.

8. Current MIASF Subzones
3 FTZ Sites approved and activated by Customs:
1. LMC
LMC recently obtained Production Authority which means LMC can repair or refit Vessels with bonded parts and components without payment of duties.  If the Vessel then is exported from the US, then no duty is due nor is FL sales tax due.
2. Bahia Mar
During FLIBS, Bahia Mar will be allowed to receive Vessels for exhibition under FTZ and to move them from Exhibition to Exhibition without having to stop showing it. 
3. Pier 66
Pier 66 has one Vessel in its FTZ right now.

9. Current MIASF Subzones
2 FTZ Sites approved and 2-3 weeks away from activation by Customs:
1. Taylor Lane Yacht and Ship
Taylor Lane Yacht & Ship LLC has applied for activation, has been approved pending filing of their bond.  They will act more like LMC.
2. The Quay
The Quay has applied for activation, it will be able to hold 4 yachts.  SanLorenzo has the space totally booked for long term occupancy.
14 FTZ Sites approved, but not yet activated by Customs:
Bradford Marine Rosciolli
Lauderdale Marina Frank & Jimmies
Wards Electronics Yacht Management
Derektors Dania Marine
Fassmer Marina Mile Marina
Hilton Fort Lauderdale D.S. Hull # 1
D.S. Hull #2 National Marine
*Not part of the MIASF Subzone, in Palm Beach County, Rybovich is now approved and activated as a FTZ.