Foreign Trade Zone
What is an Activity Code 4 - Foreign Trade Zone
Bond?
A Foreign Trade Zone (FTZ) is considered non-U.S.
territory for Customs’ purposes and foreign goods placed into FTZ may be
manufactured, manipulated, repacked or exported without paying duties. The
Activity Code 4 Customs Bond, required to be filed by all FTZ operators, is a
guaranty to the U.S. government, from an insurance company, that the FTZ will
follow all rules governing FTZ’s. If any rules or regulations are not followed
and if any duties, fines or penalties arise as a result, the FTZ must pay
Customs & Border Protection, and if they do not, the insurance company
will be required to pay. The bond further allows the insurance company to seek
any legal means to recoup any monies paid on behalf of the FTZ.
TRG Underwriting Requirements: These bonds
are strictly underwritten but are available to Trade Risk Guaranty if strong
financial statements or an irrevocable letter of credit are supplied.