Three Mississippi Companies with Limited FTZ Approval for Micro-Denier Suede Upholstery Fabrics Seek Extension of Approval for Indefinite Time

The U.S. Department of Commerce Foreign Trade Zone Boards has announced that the Greater Mississippi Foreign-Trade Zone, Inc. has submitted notifications of proposed production activity on behalf of Bauhaus USA, Inc. ("Bauhaus"), H.M. Richards, Inc. ("HMRI"), and Lane Furniture Industries, Inc. ("Lane"), located in Belden, Guntown, Saltillo, and Verona, Mississippi.

The Bauhaus facility is located within Site 16 of FTZ 158 and currently has authority to conduct cut-and-sew activity using certain foreign micro-denier suede upholstery fabrics to produce upholstered furniture and related parts (upholstery cover sets) on a restricted basis (see, Board Order 1600, 74 FR 262-263, 1-5-2009). Board Order 1600 authorized the production of upholstered furniture (sofa, chairs, and recliners) for a five-year period, with a scope of authority that only provides FTZ savings on a limited quantity (3.5 million square yards/year) of foreign origin, micro-denier suede upholstery fabric finished with a hot caustic soda solution process. All foreign upholstery fabric other than micro-denier suede fabric used in Bauhaus' production within FTZ 158 is subject to full customs duties.

The HMRI facility is located within Site 15 of FTZ 158 and currently has authority to conduct cut-and-sew activity using certain foreign micro-denier suede upholstery fabrics to produce upholstered furniture and related parts (upholstery cover sets) on a restricted basis (see, Board Order 1599, 74 FR 263, 1-5-2009). Board Order 1599 authorized the production of upholstered furniture (sofa, chairs, and recliners) for a five-year period, with a scope of authority that only provides FTZ savings on a limited quantity (3.6 million square yards/year) of foreign origin, micro-denier suede upholstery fabric finished with a hot caustic soda solution process. All foreign upholstery fabric other than micro-denier suede fabric used in HMRI's production within FTZ 158 is subject to full customs duties.

The Lane facilities are located within Sites 14, 16, and 17 of FTZ 158 and currently have authority to conduct cut-and-sew activity using certain foreign micro-denier suede upholstery fabrics to produce upholstered furniture and related parts (upholstery cover sets) on a restricted basis (see, Board Order 1598, 74 FR 263, 1-5-2009). Board Order 1598 authorized the production of upholstered furniture (sofa, chairs, and recliners) for a five-year period, with a scope of authority that only provides FTZ savings on a limited quantity (6.5 million square yards/year) of foreign origin, micro-denier suede upholstery fabric finished with a hot caustic soda solution process. All foreign upholstery fabric other than micro-denier suede fabric used in Lane's production within FTZ 158 is subject to full customs duties.

The current requests seek to extend the companies' current FTZ authority indefinitely.

The proposed scope of authority under FTZ procedures would only involve micro-denier suede upholstery fabrics finished with a hot caustic soda solution process, as detailed in the notification (duty rate ranges from 2.7 to 17.2%). All other material inputs used in the production activity would be in domestic (duty paid) status.

Public comment is invited from interested parties. Submissions shall be addressed to the FTZ Board's Executive Secretary and received by May 20, 2013.