Jersey Louis Vuitton May Secede
Louis Vuitton’s land in Springfield, N.J., may soon no longer be considered U.S. soil.
The company is currently under consideration to become part of a New Jersey “Foreign-Trade Zone,” which would mean that Louis Vuitton Watch and Jewelry U.S.A.’s (LVMH-W&J) would have fewer restrictions and could ultimately lower its costs.
Seems strange for the company that sells luxury leather goods, but it’s not totally uncommon.
The Port Authority oversees one of the five Foreign Trade Zones in New Jersey, which has nine sub-zones, for companies like Bristol-Myers Squibb, Electronic Materials USA Corporation, and Merck & Company Inc. (These special geographic zones can be a boon for business in the state).
Based on information from the Port Authority’s calendar this week, currently under consideration is a proposed sub-zone for LVMH-W&J at 966 South Springfield Avenue in Springfield, which includes offices and a warehouse consisting of around 52,684 square feet of space. The designation would give the company benefits, such as direct delivery, allowing imported, non-restricted merchandise to move on an expedited basis from the port of arrival (without prior Customs approval for each shipment of non-restricted merchandise admitted to the zone).
“This would indirectly save time and money for LVMH-W&J. Sub-zone approval also would be beneficial to the State of New Jersey by assisting LVMH-W&J in keeping valuable jobs in New Jersey, which would positively impact the economy, in the form of tax revenues, wages, and reinvestment in the local economy,” the calendar report says.
It’s a win-win!
After the FTZ Board gives its approval and Customs activates it, the company would pay the Port Authority an annual operator fee of $13,000.
But it’s worth it.
“FTZ designation would allow LVMH-W&J to be more competitive,” the calendar says.
A spokesperson for the company could not comment at this time.