No duty is paid on waste, and the duty on scrap is eliminated or reduced. Merchandise under bond may be transferred to a FTZ from customs territory for the purpose of satisfying a legal requirement to export or destroy merchandise which does not meet customs technical requirements. Imported merchandise that cannot enter U.S. Customs territory because of customs restrictions may be entered into a foreign-trade zone for export only. The merchandise may also be manipulated while in the zone to meet the requirements of customs. Merchandise that is imported can also be transferred into a FTZ to avoid custom quota restrictions.
Merchandise can stay in the zone until the quota is re-opened.
In some instances, products can be manipulated enough where quota restrictions do not apply. Some products may be manipulated enough while in the zone so that U.S. Customs duties are not due. A Foreign-trade zone is an unique concept because of its recognition of being outside of the U.S. Customs territory. A bonded warehouse is within the U.S. Customs territory. Bonded warehouses have limitations on transfers and offer limited ability to select classification and evaluation of merchandise.