Foreign-Trade Zone 61-San Juan, PR, Expansion of Facilities and Manufacturing Authority-Subzone 61H, Baxter Healthcare Corporation Plant (Pharmaceuticals), Guayama, PR

An application has been submitted to the Foreign-Trade Zones Board (the Board) by Baxter Healthcare Corporation of Puerto Rico (Baxter), requesting to add capacity and to expand the scope of manufacturing authority under zone procedures within Subzone 61H, at the Baxter plant in Guayama, Puerto Rico. It was formally filed on September 10, 2002.

Subzone 61H was approved by the Board in 1997 at a single site located at Route 3, km. 142.5, Guayama, Puerto Rico, with authority granted for the manufacture of pharmaceuticals including inhalation anesthetics (Board Order 875, 62 FR 10521, 3/7/97).

Subzone 61H (200 employees) currently consists of 23 buildings totaling 176,000 square feet on 38 acres. Baxter is now proposing to add 9 buildings of 33,716 sq. ft. and 1.15 acres. The proposed Subzone 61H would then consist of 32 buildings of 209,716 sq. ft. on 39.15 acres.

The application also requests to expand the scope of authority for manufacturing activity conducted under FTZ procedures to include additional general categories of inputs that have recently been approved by the Board for other pharmaceutical plants. They include chemically pure sugars, empty capsules for pharmaceutical use, protein concentrates, natural magnesium phosphates and carbonates, gypsum, anhydrite and plasters, petroleum jelly, paraffin and waxes, sulfuric acid, other inorganic acids or compounds of nonmetals, ammonia, zinc oxide, titanium oxides, fluorides, chlorates, sulfates, salts of oxometallic acids, radioactive chemical elements, colloidal precious metals, compounds of rare earth metals, acyclic hydrocarbons, derivatives of phenols or peroxides, acetals and hemiacetals, phosphoric esters and their salts, diazo-compounds, glands for therapeutic uses, wadding, gauze and bandages, pharmaceutical glaze, hair preparations, lubricating preparations, albumins, prepared glues and adhesives, catalytic preparations, diagnostic or laboratory reagents, prepared binders, acrylic and ethylene polymers, self-adhesive plates and sheets, other articles of vulcanized rubber, plastic cases, cartons, boxes, printed books, brochures and similar printed matter, carboys, bottles, and flasks, stoppers, caps, and lids, aluminum foil, tin plates and sheets, taps, cocks and valves, and medical instruments and appliances. Materials sourced from abroad represent some 50-70 percent of the total value of materials used in production.

Zone procedures would exempt Baxter from Customs duty payments on foreign materials used in production for export. Some 30 percent of the plant's shipments are exported. On domestic shipments, the company would be able to defer Customs duty payments on foreign materials, and to choose the duty rate that applies to finished products (duty free-9.2%) instead of the rates otherwise applicable to the foreign input materials (duty free-20%)(noted above). The application indicates that the savings from zone procedures would help improve Baxter's international competitiveness.

In accordance with the Board's regulations, a member of the FTZ staff has been designated examiner to investigate the application and report to the Board.

Public comment is invited from interested parties. Submissions (original and 3 copies) shall be addressed to the Board's Executive Secretary at one of the following addresses:

1. Submissions Via Express/Package Delivery Services: Foreign-Trade-Zones Board, U.S. Department of Commerce, Franklin Court Building—Suite 4100W, 1099 14th St. NW., Washington, DC 20005; or

2. Submissions Via the U.S. Postal Service: Foreign-Trade-Zones Board, U.S. Department of Commerce, FCB—Suite 4100W, 1401 Constitution Ave. NW., Washington, DC 20230.

The closing period for their receipt is November 18, 2002. Rebuttal comments in response to material submitted during the foregoing period may be submitted during the subsequent 15-day period (to December 2, 2002).

A copy of the application and accompanying exhibits will be available for public inspection at the Office of the Foreign-Trade Zones Board's Executive Secretary at address Number 1 listed above, and at the U.S. Department of Commerce Export Assistance Center, 525 F.D. Roosevelt Ave., Suite 905, San Juan, PR 00918.