1. Who is on the FTZ Board? • The Secretary of Commerce (Chair) and the Secretary of the Treasury • Commissioner of Customs & Border Protection (CBP) provides a position during the FTZ Board voting process on matters of security, control, and CBP resources. • The FTZ Board has delegated action authority on most matters to a Committee of Alternates, which is composed of the Assistant Secretary of Commerce for Import Administration and the Deputy Assistant Secretary of the Treasury for Tax, Trade and Tariff Policy.

2. FTZ Board Executive Secretary Andrew McGilvray Authority to approve minor FTZ requests Supervises FTZ Board staff Staff comprised of economists, FTZ analysts and a program assistant 2

3. Modernizing the FTZ Program • Complete overhaul of regulations through extensive public comment process (incl. regional forums). • Major changes needed to keep pace with speed of business and ASF improvements. • For ordinary requests for “production” authority, much less paperwork; decision timeframe cut to 120 days. • Faster, simpler processes reduce costs of access to FTZ program, increase companies’ participation.

4. Modernizing the FTZ program (cont.) • FTZ Board’s emphasis has shifted to facilitating designation of sites for companies’ use. • Optional “Alternative Site Framework” (adopted in 2008, incorporated into regulation in 2012) radically simplifies and expedites bringing FTZ to companies. • 2012 regulations (first overhaul in 20 years) streamline and accelerate procedures wherever possible. • New application formats

5. Participation in the ASF can allow grantees to devote time to bringing the competitiveness benefits of FTZs to U.S. companies. For a grantee, ASF dramatically reduces burden and increases flexibility and predictability on designation of FTZ sites to meet companies’ needs in their region. For FTZ Board, ASF improves efficiency and better enables agency to fulfill its mission while striking necessary balance between flexibility and focus. Usage-driven or Subzone designation within 30 days for companies located within an ASF service area Alternative Site Framework Benefits

6. How was the ASF developed? • FTZ Staff consulted with grantees and others to develop zone-site management option that is: • flexible (for users), • focused (for oversight purposes), and • predictable (for everyone’s benefit). • 120 ASF Zones (as of May 31, 2013)

7. Subzone designation tied to land only • 3 or 5-month process (non-ASF) • Possible production activity is a separate application process • Option for companies located outside of a grantee’s service area • Does not have to meet 60 mile/90-minute adjacency requirement

8. Simplified Production Authority Application process • Production Notifications • 120-day process • Simple format (brief description of activity and list of products/components) • Majority of requests for production authority from companies approved using the notification process without having to do the full production application

9. Production Application process • Full Production Application process needed for ¼ of requests from companies seeking production authority (up to approximately 12 month process) • If FTZ Board review of the notification results in the determination that further review is warranted of the proposed activity the application process applies (public interest considerations, controversial industries, comments received, etc.).

10. Recent Trends in the Program Increase in Production Notifications (easier to apply, faster process) Increase in zone use by Apparel and footwear companies (duty deferral and weekly entry benefits) More interest in the program from small businesses 10

11. Contact the FTZ Board Staff FTZ Board web site: www.trade.gov/ftz contact information, ASF application formats, etc. Do not hesitate to contact your Regional Representative, with any questions that may come up: Christopher.Kemp@trade.gov or (202) 482-0862 or dial main office line (202) 482-2862 to reach another FTZ Analyst