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Foreign Trade Zone

In the global marketplace, many companies consider moving to foreign facilities to reduce costs. The benefits of the Foreign-Trade Zones Program may be the competitive advantage that companies need to keep their manufacturing or distribution operations in the United States. These include:

  • Duty Deferral: Delayed payment of duties on goods that enter the U.S. market
  • Duty Exemption: No duties on imported goods that are later re-exported
  • Inverted Tariff: Manufacturing-specific benefits - can include reduction of duties if a lower tariff rate applies to the finished product leaving the zone than the tariff rates that would have applied on the foreign components.
  • Logistical Benefits: Reductions in merchandise processing fees due to a single customs "entry" (pay one fee) per week rather than making multiple entries during the course of a week
  • Other Benefits: Elimination of duties on waste, scrap and rejected or defective parts