4 ms·
Step 1: create what is called in the US a foreign trade zone (internationally Free Trade Zone) Step 2: get VC to give you funding at ridiculous valuation Step
by will_brown 8y ago
Step 1: create what is called in the US a foreign trade zone (internationally Free Trade Zone)
Step 2: get VC to give you funding at ridiculous valuation
Step 3: market yourself as “tech” start up, that is hacking the (new) law, and disrupting globally industry (of course said start up isn’t actually doing anything new that the manufacturing industry hasn’t always done)
Sources: I was involved in one for an e-bike manufacturer (set up right next door to a craft brewery)
https://en.m.wikipedia.org/wiki/Foreign-trade_zones_of_the_United_States https://en.m.wikipedia.org/wiki/Foreign-trade_zones_of_the_U...
https://www.cbp.gov/border-security/ports-entry/cargo-security/cargo-control/foreign-trade-zones/about https://www.cbp.gov/border-security/ports-entry/cargo-securi...
- lozaning 8y agoThe first sentence of the 4th paragraph of your second link would seem to dispute your strategy. "Under zone procedures, the usual formal CBP entry procedures and payments of duties are not required on the foreign merchandise unless and until it enters CBP territory for domestic consumption" So the minute your startup sells me a chip for use in the US and it then leaves the free trade zone the tariff becomes due.
- will_brown 8y agoIf I am importing a chip and reselling it I am not a manufacturer and yes I pay the tariff. If I import the chip and use it as a component in my manufacturing of the end product I don’t pay the tariff on that chip. The idea of the startup, as I mentioned in another comment, would be creating the zone and charging manufacturers to use my Zone. Like an Uber or On demand or WeWork (whatever SV analogy works best for you) of Foreign Trade Zones.
- CodeCube 8y agoAnd these "startups" would certainly charge a premium for access to their services/zone ... so the "end user" still ends up footing the bill.