USTR Designates Two New Qualifying Industrial Zones (QIZs) and Another Expanded QIZ
The Office of the U.S. Trade Representative (USTR) has issued a notice designating the Resources Company for Development and Investment Zone (RCDI), the Al Hallabat Industrial Park, and the expanded Al Tajamouat Industrial Park as qualifying industrial zones (QIZs) from which goods, including textiles and apparel, may enter the U.S. duty-free under the U.S.-Israel Free Trade Area Implementation Act (IFTA Act).
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(Al Tajamouat Industrial City was initially designated as a QIZ, effective on October 15, 1999. (See ITT's Online Archives or 10/18/99 news, 99101552, for BP summary.))
The USTR states that the above designations are effective on January 28, 2004, and are applicable to goods shipped from these QIZs after January 28, 2004.
Background
The USTR states that Presidential Proclamation 6955 proclaimed certain tariff treatment for articles of the West Bank, the Gaza Strip, and QIZs. In particular, Proclamation 6955 modified General Notes 3 and 8 of the Harmonized Tariff Schedule (HTS) to provide:
duty-free treatment to qualifying articles that are the product of the West Bank, the Gaza Strip or a QIZ, and are entered in accordance with the provisions of Section 9 of the 1985 U.S.-Israel Free Trade Area Implementation Act (IFTA Act);
that articles of Israel may be treated as though they were articles directly shipped from Israel for the purposes of the U.S.-Israel Free Trade Area Agreement (Agreement) even if shipped to the U.S. from the West Bank, the Gaza Strip, or a QIZ, if the articles otherwise meet the requirements of the Agreement; and
that the cost or value of materials produced in the West Bank, the Gaza Strip, or a QIZ may be included in the cost or value of materials produced in Israel under Section 1(c)(i) of Annex 3 of the Agreement and that the direct costs of processing operations performed in the West Bank, the Gaza Strip, or a QIZ may be included in the direct costs of processing operations performed in Israel under Section 1(c)(ii) of Annex 3 of the Agreement.
According to the USTR, Section 9(e) of the IFTA Act defines a "qualifying industrial zone'" as an area that "(1) encompasses portions of the territory of Israel and Jordan or Israel and Egypt; (2) has been designated by local authorities as an enclave where merchandise may enter without payment of duty or excise taxes; and (3) has been specified by the President as a qualifying industrial zone." The USTR notes that Proclamation 6955 delegated to the USTR the authority to designate QIZs
(See ITT's Online Archives or 06/03/03 news, 03060340 2, for BP summary of U.S. Customs and Border Protection's (CBP's) notice listing all the industrial parks identified as QIZs as of January 2003.)
USTR contact - Edmund Saums (202) 395-4987
USTR notice (FR Pub 01/28/04) available at http://a257.g.akamaitech.net/7/257/2422/14mar20010800/edocket.access.gpo.gov/2004/pdf/04-1745.pdf