Foreign-Trade Zones

A Foreign-Trade Zone (FTZ) is a site within the United States, in or near a U.S. Customs Port of Entry, where foreign and domestic merchandise is generally considered to be in international commerce (e.g. outside of U.S. Customs territory). Foreign or domestic merchandise may enter a FTZ without a formal customs entry or the payment of customs duties or government excise taxes.
Merchandise entering a zone may be:
  • Assembled
  • Cleaned
  • Destroyed
  • Displayed
  • Manipulated

  • Manufactured
  • Mixed
  • Processed
  • Relabeled
  • Repackaged

  • Repaired
  • Salvaged
  • Sampled
  • Stored
  • Tested
Duties & Excise Taxes
If the final product is exported, no U.S. Customs duties or excise taxes are levied. If the final product is imported into the United States, customs duties and excise taxes are due only at the time of transfer from the FTZ. The duties paid are the lower of those applicable to the final product itself or its component parts (inverted tariff option).

Subzones
Foreign-Trade Subzones
Foreign-Trade Subzones may be established to extend FTZ benefits to individual manufacturing firms at their existing plant locations. The purpose of FTZs and Subzones is to stimulate international trade and create jobs and investment in the United States rather than abroad.

Considerations for Using a Foreign-Trade Zone or Subzone

Advantages of Using a Foreign-Trade Zone or Subzone

Foreign-Trade Subzone Application Process