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FREE TRADE WAREHOUSING ZONE (FTWZ)

Free Trade and Warehousing Zone (FTWZ) is a special category of special Economic Zone (SEZ), wherein mainly trading and warehousing and other related activities thereto are carried on.

  • To Improve Logistics Infrastructure
  • To Promote International Trading.
  • To Improve Cash Flow for Customers and Delivery Time.
  • Customs Declaration and Management
  • Transportation: Road, Rail and Air(primary and secondary)
  • Warehouse Management System
  • Purchase Order Management
  • Package Management
  • Temperature Controlled Chambers
  • Quality Control
  • Reverse Logistics, including Repairs and Refurbishing
  • Re-invoicing
  • Assembly of CKD and SKD kits
  • Pick & Pack, Kitting
  • Bar-coding
  • Labeling & Re-labeling
  • Cutting, Blending & Polishing

FEATURES OF (FTWZ)

  • Deemed Foreign Territory - Movement of goods via deemed foreign territory (FTWZ) ensures hassle-free customs clearance for all imports and exports.
  • Tax Exemptions - Goods in the FTWZ have the same tax concessions as for Bonded, EOU & SEZ goods. Movement of goods from FTWZ into DTA is considered import, and all Exemption/Concessions are available at par with normal import.
  • Exporting Convenience - Simplified Export Procedures as physical export transactions get completed once goods are moved into FTWZ. Exporter can Claim Export Concessions as soon as goods have moved into FTWZ, even if the goods have not physically moved out of the country
  • Bulk/Sensitive Commodities - Availability of Open/Demarcated Area for convenient storage of bulk and sensitive commodities. Single Window Clearance for goods otherwise requiring Regulatory Approvals.
  • World Class Amenities - Warehousing standards Adhered to all Industry Verticals combined with State of the art Material Handling Equipment.
  • Vendor Managed Inventory - Demand and Supply Gaps are adjusted through vendor management inventories. Availability of Stock as per Demand for the buyer and faster Response time during product launch.
  • Just In Time - Strategic Inventory Management to save time and costs. Edge over competitors by way of increased service quality.
  • Consolidation Hub - Commodities imported can be Consolidated and Stocked Duty-free until required. Goods from different locations can be consolidated for exporting thereby Reducing Logistics Cost and Time-consumption in processing individual export entries.
  • Duty Deferment & Allied Acts - Defer Duty Payment and Compliance to Allied Acts whilst goods are still in FTWZ. Greatly improves users cash flow.

VALUE ADDED SERVICES

  • Package management, repacking, labelling, kit assembly, CKD assembly, bundling, screen printing on package or products, weight management, pick & pack and many more as per requirement through special permission.
  • Temperature controlled chambers for storage of shelf life & perishable cargo storage.
  • Setting up Quality control platform like a Quality check, testing, measurement, weighing, Sampling etc.
  • Re-invoicing.
  • Assembly of CKD and SKD kits.
  • Pick & pack, Kitting.
  • Bar-coding.
  • Labelling & Re-labeling.
  • Cutting, Blending & Polishing.
  • Bottling.
  • Clubbing.
  • Consolidation.
  • Quality checking.
  • Testing, kitting.
  • Combination packing.
  • Handling.
  • Storage of empty containers.

Importers

  • Flexibility towards end distribution in India.
  • Duty deferment benefits (freeing up working capital & increasing sales).
  • Quality control capability before duty-payment.
  • Hassle-free re-export regulatory /duty implications.
  • Reduced buffer stocks.
  • Lowered product costs.
  • Foreign exchange transaction capability.

Exporters

  • Products from India entering the FTWZ are treated as deemed export providing immediate benefits to suppliers. Suppliers can avail such benefits through their Zone.
  • Local Tax Exemption (e.g. CST, Sales Tax, Excise& VAT) while goods procured for further export through FTWZ.
  • Export quotas or export obligation can be met for companies exporting into FTWZ by EOU units, under EPGC or any other export obligation units.
  • Increased efficiency through lowered reverse logistics through quality control before dispatch from India (creation of multi suppliers consolidation platform, quality check platform, Value-added platform (VAS) like packing/ kitting/Labeling.
  • Foreign exchange transactions capability.
  • Increasing supply chain efficiencies (forward & reverse) while enhancing capital cash flow..

Re-Exporters

  • Import and multi countries export through FTWZ by India or Foreign companies.. Suppliers can avail such benefits through their Zone.
  • A mix of imported material and local procurement materials for final export through FTWZ.
  • Exemption from custom and stamp duty on products imported into FTWZ; meant for re-export out of India.
  • Hassle-free re-export process with various value-added services.
  • Ability to leverage India's cost, skill & geographic positioning advantage as a hub for regional/global distribution post Value Optimizing activities.

BENEFITS OF (FTWZ) OVER BONDED WAREHOUSE

PARTICULARS FTWZ BONDED WAREHOUSE
PORT STATUS SEZ Act Sec 53(2). FTWZ is a Deemed Port No Deemed Port status.
NFE FTWZ Units are required to be NFE positive under SEZ Rule 53 No NFE requirement by Bonded Warehouses.
Assessment of Duty Since the FTWZ is a Deemed Port the Goods are NOT assessed for Duty. A Bill of Entry for home consumption is filed with FTWZ Unit for transfer of goods from Airport/ Port to FTWZ Bill of Entry for Warehousing is filed and assessed to Duty before being permitted to move to the Bonded WH
Multi Country Consolidation Consolidation of goods from Multi Country Permitted as per customer's requirement. Consolidation of goods not Permitted
Duty Deferment Bond No requirement for a double duty bond Additional double duty bond required
Movement from Customs Gateway Goods are transported from customs gateway to FTWZ via trans-shipment procedure without assessment by customs in turn decreasing Customs process lead time Movement of goods into the bonded warehouse are subject to assessment at Gateway Customs
Value Added Services (VAS) Can carry out Value Added Services as provided for in SEZ Rule 18 (5) Value Added Services are permitted subject to Customs permission in advance of any such activity.
Holding Goods on Account of Foreign Supplier / Buyer Permitted under SEZ Rule 18 (5 Not permitted
Restricted Goods Imports Permissible to enter the FTWZ. Goods can enter Bonded Warehouse pending Production of import license
Prohibited Goods Imports Permissible to enter the FTWZ with the Approval of the BOA Not Permissible
Period of Storage SEZ Rule 37 permits the goods to be kept until the Validity of the Unit Holder. The goods in the FTWZ are not assessed for Duty. One Year, further extension allowed subject to approval from Chief Commissioner of Customs
Interest on Duty Interest on Duty not applicable Beyond 90 Day, interest is levied.
Customs procedure or Removal of Goods Hassle-Free procedure for Removal of goods from FTWZ to DTA. Customs processing done within the FTWZ zone. All customs processing with the customs house located away from the bonded facility
Compliance of Allied Acts Payment of duty and compliance to allied acts only when the goods move out of FTWZ into DTA Payment of duty at the time of removal of goods along with applicable interest & upon production of applicable import license
Easy of EXIM Trade Hassle-Free Procedure for re-exports and re-import unlike standard customs procedure. Re-imports and re-exports go through standard customs approval procedures
Foreign Exchange All Payments in Free Foreign Exchange All payments in INR only.

UTILIZATION

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