FOREIGN-TRADE ZONES BOARD
ORDER NO. 29
Part 400- General Regulations Governing Foreign-Trade Zones
in the United States,
With Rules of Procedure
Miscellaneous Amendments
Notice of proposed rule making having been given, pursuant to section 4 of the Administrative
Procedures Act (5 USC 1003), published in the Federal Register on October 19, 1951 (16 FR
10706-10708), consideration having been given to all suggested revisions, views and
arguments submitted in writing by interested persons, and required notice having been given of
the disposition thereof, the General Regulations Governing Foreign-Trade Zones in the
United States, with Rules of Procedure of the Foreign-Trade Zones Board (15 CFR Part 400), are
hereby amended, and become effective 30 days after publication in the Federal Register, as
follows:
1. Amend Sec. 400.100 to read as follows:
Sec. 400.100 Act. The term "Act" means the Foreign-Trade Zone Act of June 18, 1934 (48 Stat.
998-1003; 19 USC 81a-81u), as amended by Pub. Law 566, 81st Cong., approved June 17, 1950.
2. Amend Sec. 400.101 to read as follows:
Sec. 400.101 Zone. The term "zone" means a "foreign-trade zone." It is an isolated, enclosed
and policed area, operated as a public utility, in or adjacent to a port of entry, furnished
with facilities for lading, unlading, handling, storing, manipulating, manufacturing, and
exhibiting goods, and for reshipping them by land, water, or air. Any foreign and domestic
merchandise, except such as is prohibited by law or such as the Board may order to be
excluded as detrimental to the public interest, health or safety, may be brought into a zone
without being subject to the customs laws of the United States governing the entry of goods
or the payment of duty thereon; and such merchandise permitted in a zone may be stored,
exhibited, manufactured, mixed or manipulated in any manner, except as provided in the act and
other applicable laws or regulations. The merchandise may be exported, destroyed, or sent
into customs territory from the zone, in the original package or otherwise. It is subject
to customs duties if sent into customs territory, but not if reshipped to foreign points.
3. Add new Sec. 400.304.
Sec. 400.304 Zones for specialized purposes. The establishment of a zone, or a sub-zone in an
area separate from an existing zone, for one or more of the specialized purposes of storing,
manipulating, manufacturing, or exhibiting goods, may be authorized if the Board finds that
existing or authorized zones will not serve adequately the convenience of commerce with
respect to the proposed purposes.
4. Delete Sec. 400.800 and substitute the following:
Sec. 400.800 Operations in a zone, and forms and procedures. The merchandise and operations
permitted in a zone, the disposition of merchandise in a zone, the zone status of the
merchandise and special provisions applicable to each status, the subsequent importation
of merchandise exported from a zone, and other operations in a zone authorized by the act, are
hereinafter in this part generally described. The zone forms required are appended to these
regulations and made a part thereof, and the procedures required are set forth
in Customs regulations relating to foreign-trade zones (19 CFR Part 30) and the regulations
and schedules of rates and charges made and fixed by the zone grantee and approved by the Board.
5. Delete Sections 400.801 and 400.802 and substitute the following:
Sec. 400.801 Merchandise permitted in a zone. Foreign and domestic merchandise of every
description, except such as prohibited by law, may, without being subject to the customs
laws of the United States, except as otherwise provided in the act and regulations made
thereunder, be brought into a zone.
(a) Merchandise which is specifically and absolutely prohibited by law shall not be admitted
into a zone. Any merchandise so prohibited by law which is found within a zone shall be
disposed of in the manner provided for in the laws and regulations applicable to such
merchandise. A distinction is made between (1) merchandise which is specifically and
absolutely prohibited by law on the grounds of policy or morals, such as immoral or subversive
literature, obscene articles, or lottery matter, and (2) merchandise which is subject to
conditional prohibition only, for example, articles which are subject to permits or licenses
for the protection of economic or national security or which may be reconditioned to bring
them into compliance with the laws administered by various Federal agencies. Collectors of
customs are required to exclude the first class of articles and may not permit them to be
transferred to a zone if they are aware of their prohibited status, except that the collector
may permit the temporary deposit of any such merchandise in the zone pending final
determination of its status. The transfer of articles of the second class to a zone is
subject to any requirements of the Federal agency concerned. There is no prohibition against
placing over-quota merchandise in a zone pending its right to transfer to customs territory
pursuant to the applicable quota provisions.
(b) The application for the admission of merchandise into a zone shall be approved or
disapproved by the collector, as the representative of the Board, where the merchandise is not
excluded by any other Federal agency having jurisdiction over the merchandise.
6. Add new Sec. 400.802.
Sec. 400.802 Disposition of merchandise in a zone. In general, merchandise lawfully brought
into a zone may, in accordance with these and other regulations made under the provisions of
the act be exported, destroyed, or sent into customs territory of the United States therefrom,
in the original package or otherwise; but when foreign merchandise, and domestic merchandise
whose identity has been lost, is so sent from a zone into customs territory of the
United States it shall be subject to the laws and regulations of the United States affecting
imported merchandise.
7. Change the number of Sec. 400.803, "Exclusion from zone of goods or process of
treatment", to Sec. 400.807.
8. Add new Sec. 400.803.
Sec. 400.803 Manipulation, manufacture, and exhibition of merchandise. In general, merchandise,
lawfully brought into a zone may, in accordance with these and other regulations made under the
provisions of the act, be stored, sold, exhibited, broken up, repacked, assembled, distributed,
sorted, graded, cleaned, mixed with foreign and domestic merchandise, or otherwise manipulated,
or be manufactured, except as otherwise provided by the act.
(a) Permission for any manipulation, manufacture, or exhibition in a zone shall be
obtained from the collector, as the representative of the Board, subject to such application
and procedure prescribed by the Secretary of the Treasury for the protection of the revenue.
(b) In the event of the denial of any application by the collector for any reason, the
applicant, the grantee, or the operator of the zone may appeal the adverse ruling to the Board.
If any revenue-protection considerations are involved in such an application, the Board shall be
guided by the determinations of the Secretary of the Treasury with respect to them.
9. Delete Sec. 400.803a, entitled "Handling of gold."
10. Change the number of Sec. 400.804, "Retail trade within zone", to Sec. 400.808.
11. Add new Sec. 400.804.
Sec. 400.804 Status of merchandise in a zone. (a)For the purposes of the act and the regulations
of this part, all merchandise within a zone, except merchandise in transit through a zone as
provided in Sec. 30.5 of Customs regulations and except merchandise temporarily transferred
to a zone for manipulation as provided in paragraph (b) of this section, shall be given a
zone status as:
(1) Privileged foreign merchandise,
(2) Privileged domestic merchandise,
(3) Non-privileged foreign merchandise,
(4) Non-privileged domestic merchandise, or
(5) Zone-restricted merchandise,
in accordance with sections 30.6, 30.7, 30.8, 30.9, and 30.10 of Customs regulations.
(b) Imported merchandise which has been entered and which has remained in continuous customs
custody may be temporarily transferred to a zone for manipulation under customs supervision
pursuant to section 562, Tariff Act of 1930, as amended, and for return to customs territory.
Any such merchandise shall not be considered within the purview of the Foreign-Trade Zones Act,
but shall be treated in all respects as though remaining in customs territory. Therefore no
zone form or procedure shall be considered applicable, but the merchandise shall remain
subject in the zone to such requirements as are necessary for the enforcement of section 562
and other pertinent customs laws.
12. Delete Sec. 400.805 and substitute the following:
Sec. 400.805 Use of zone by carriers. The water area, docking facilities, and loading or
unloading stations of a zone are intended primarily for use of vessels, vehicles, or aircraft
unlading merchandise from the zone, and their use for other purposes may be terminated by the
Secretary of the Treasury if found to endanger the revenue, or by the Board if found to
interfere with the primary uses of the zone.
13. Add new Sec. 400.806.
Sec. 400.806 Subsequent importation of zone merchandise. Articles produced or manufactured in
a zone and exported therefrom shall, on subsequent importation into the customs territory
of the United States, be subject to the import laws applicable to like articles manufactured
in a foreign country, except that articles produced or manufactured in a zone exclusively
with the use of domestic merchandise, the identity of which has been maintained in
accordance with the Second Proviso of section 3 of the Act, as amended, may, on such
importation, be entered as American goods returned.
14. Change the numbers of sections as follows:
a. Section 400.806, "Residence within zone", to Sec. 400.809.
b. Section 400.807, "Employees and persons entering and leaving the zone", to Sec. 400.810.
c. Section 400.808, "All persons entering zone bound by regulations", to Sec. 400.811.
d. Section 400.809, "Identification of employees within zone", to Sec. 400.812.
15. Change the number of Sec. 400.810 to Sec. 400.813, and amend to read as follows:
Sec. 400.813 Hours of business and service. Hours of business and service, for customs
purposes, shall be the same as those prescribed in Customs regulations.
16. Change the number of Sec. 400.811 to Sec. 400.814, and amend to read as follows:
Sec. 400.814 Payment of customs officers and employees. (a) The cost of maintaining the
customs service in a zone shall be paid monthly by the grantee of such zone to the collector
of customs.
(b) Customs officers and employees performing services in a zone at night, or on Sundays
and holidays, shall receive extra compensation, to be computed as and under the conditions
prescribed by Customs regulations.
(c) For the purpose of computing extra compensation the word "night" shall be construed to
mean the time from 5:00pm to 8:00am, and the word "holiday" shall include only national
holidays, viz., January 1, February 22, May 30, July 4, the first Monday in September,
November 11, the fourth Thursday in November, and December 25, and such other days as may be
made national holidays.
(d) In a zone at a port where customary working hours are other than those herein mentioned,
the collector of customs is authorized to regulate the hours of customs officers and
employees assigned to the zone so as to agree with prevailing working hours in said port,
but nothing herein shall be construed in any manner to affect or alter the length of a
working day for customs officers or employees, or the overtime pay.
17. Change the number of Sec. 400.812, "Erection of buildings within zone by persons
other than grantee", to Sec. 400.815.
18. Delete Sec. 400.1000 and substitute the following:
Sec. 400.1000 Operation, maintenance, and administration. The zone shall be operated,
maintained, and administered by the grantee under (a) the supervision, direction, and control
of the Board in accordance with the provisions of the act and the regulations of the Board in
this part, (b) the regulations relating to foreign-trade zones of the Bureau of Customs for
the protection of the revenue (19 CFR Part 30) and any other law, regulation or instruction
the Customs service is required or authorized to enforce, (c) such other applicable laws and
regulations thereunder of other Federal agencies, and (d) the regulations and schedules of
rates and charges made and fixed by the grantee and approved by the Board. The collector in
whose district the zone is located shall, in addition to his duties as Collector of Customs, be
in local charge of the zone as the resident representative of the Board. He may call upon
the district engineer and local representatives of other governmental departments and
agencies for advice in matters of operation, maintenance and administration.
19. Amend Sec. 400.1001 to read as follows:
Sec. 400.1001 Regulations promulgated by grantee, and posting of regulations within zone. The
grantee shall, before beginning operation of a zone submit to the Board its own rules,
regulations, and practices for the operation of the zone, subject to disapproval of the Board.
There shall be posted in a conspicuous place within the zone copies of the regulations
issued by the Board and the approved regulations of the grantee, or of such extracts from
either or both of such regulations as the Board may designate.
20. Amend Sec. 400.1002a to read as follows:
Sec. 400.1002a Uniform system of accounts, records, and reports. Every grantee of a zone
shall keep its books, records, and accounts in the form and manner prescribed in "Uniform
System of Accounts, Records, and Reports", approved February 6, 1939.
21. Delete Sec. 400.1315, entitled "Operation, maintenance and administration."
22. Change the numbers of sections as follows:
a. Sec. 400.1316 "Evidence" to Sec. 400.1315.
b. Sec. 400.1317 "Object of hearing" to 400.1316.
c. Sec. 400.1318 "Notice of hearing" to 400.1317.
d. Sec. 400.1319 "Procedure at hearing" to 400.1318.
e. Sec. 400.1320 "Adjournment of hearing" to 400.1319.
f. Sec. 400.1321 "Record of proceedings" to 400.1320.
g. Sec. 400.1322 "Additional rules of practice" to 400.1321.
Signed at Washington, DC, this 5th day of June 1952.
Foreign-Trade Zones Board
Charles Sawyer
Secretary of Commerce,
Chairman and Executive Officer,
Foreign-Trade Zones Board