Friday, June 19, 2015

Flock Cutter Files Acrylic and Rayon FTZ

On June 19 15, 2015, the FTZ Board published in the Federal Register (80 FR 35303) Foreign-Trade Zone (FTZ) 27--Boston, Massachusetts, Notification of Proposed Production Activity, Claremont Flock, (Textile Flock), Leominster, Massachusetts.

The Foreign-Trade Zone Board has received Notification of Proposed Production Activity filed by the Massachusetts Port Authority on behalf of Claremont Flock division of Spectro Coating Corporation. The Notice was drafted by Agathon Associates. Claremont Flock imports acrylic and rayon tow, with a rate of duty of 7.5 percent and produces textile flock by precision cutting the tow. There is no import duty on flock, therefore Claremont is competing against companies that import the flock duty free, while Claremont, which provided employment in Leominster, Massachusetts, is saddled with the 7.5 percent import duty.

It is well known in the textile industry that there is no domestic U.S. production of acrylic or rayon tow of the kind used in flock production. Production under FTZ procedures could exempt Claremont Flock from customs duty payments on foreign status materials used in export production. On its domestic sales, Claremont Flock would be able to choose the duty rate during customs entry procedures that applies to textile flock (free) for the acrylic and rayon tow (duty rate – 7.5%) sourced from abroad. Customs duties also could possibly be deferred or reduced on foreign status production equipment.

Approval of FTZ procedures would place Claremont at parity with it's sole domestic U.S. competitor, Cellusuede Products of Rockford, Illinois. Cellusuede was granted authorization for FTZ procedures for acrylic and rayon in 2009.

No comments:

Post a Comment