Noramco Inc. has become the first company in the state to include their facility in Delaware's Foreign-Trade Zone under the Alternative Site Framework (ASF) and to be granted "Production Authority" by the Foreign Trade Zone Board of the U.S. Department of Commerce.
The Delaware Economic Development Office (DEDO) is the grantee for Foreign-Trade Zone (FTZ) No. 99. Noramco, a subsidiary of Johnson & Johnson, has operated in Delaware since 1979 at an 81,000-square-foot facility in Wilmington. The company manufactures, tests, warehouses and packages a variety of pharmaceutical products and currently employs approximately 170. This facility has now been designated as FTZ Subzone 99F. The Foreign Trade Zone Board granted Noramco's application to be included in the FTZ in late November 2013 and Production Authority was approved on March 4, 2014.
With this designation and grant of authority, Noramco can begin to manufacture products using imported component with tariffs and duties reduced or eliminated, thereby reducing their costs until those products actually enter the U.S. markets.
"The ability to offer a tool that increases access to global markets, lowers costs and boosts efficiency will have a tremendous impact on our efforts to bring new companies to Delaware," Gov. Jack Markell said. "Companies already established in Delaware also stand to benefit. We applaud Noramco for leading the way by applying for and receiving the designation necessary to operate in the state's Foreign Trade Zone."
John Daly, General Manager of Noramco Inc. in Delaware, noted that "this designation and grant of production authority will allow Noramco to expand its operations here in Delaware and improves the efficiency of our supply chain. This is an important step in our efforts to better serve our customers in the U.S. and also globally. We are very pleased with how the new ASF process reduced both the time and the complexity of becoming a FTZ Subzone."
Foreign-trade zones are sites that are considered outside of U.S. Customs territory. The ASF allows individual businesses throughout the State to import, export, assemble, warehouse and distribute products using imported materials and reduce or eliminate customs duties and federal excise taxes. An application under ASF for a non-manufacturing site usually is processed in 30 days. A manufacturing facility requiring "Production Authority," such as Noramco, takes up to four months, a significant time reduction from the traditional process.
"Under Gov. Markell, Delaware has become a major player on the global economic stage, and the ASF provides one more tool for our state and its companies to use to compete and win," said Alan Levin, Director of the Delaware Economic Development Office. "Noramco is the first of what we hope will be many Delaware firms, large and small, who will take advantage of this streamlined process to stay and grow in Delaware thanks to the business-friendly environment created by the FTZ."
There are more than 250 Foreign-trade zones located in all 50 states and Puerto Rico. Many well-known U.S. and multinational firms utilize the zone program as an import/export financial management tool. In Delaware, the Port of Wilmington is the official Port of Entry. Companies such as Citrosuco, AstraZeneca, and PBF Energy all operate under Foreign Trade Zone designation in Delaware.