What is the Foreign-Trade Zone program?

Congress under the Foreign Trade Zone (FTZ) Act of 1934 established the Foreign-Trade Zone Program. Its purpose is to “expedite and encourage foreign commerce” with the intent to stimulate international trade while creating jobs and investment in the United States. It is a trade program, overseen by the Foreign-Trade Zone Board which is comprised of the Secretary of Commerce and the Secretary of the Treasury.

The FTZ Program is administered by the Executive Secretary and his staff who ensure that the designation of foreign-trade zone sites (both multi user and for individual companies) and their use is consistent with U.S. trade policy and provides a positive net benefit to the U.S. in terms of economic development. In essence, approval for participation in the Foreign-Trade Zone Program affords the user an exemption to the tariff schedule of the Unites States, allowing the deferral, reduction or elimination of duties paid on imported materials and goods in exchange for sustained or increased jobs and investment in the U.S. This in turn provides a benefit to the U.S. in terms of increased economic activity in the U.S. that might otherwise move offshore.

Show All Answers

1. What is a Foreign-Trade Zone?
2. What is the Foreign-Trade Zone program?
3. What are the types of Foreign-Trade Zones?
4. What companies might benefit from using FTZ procedures?
5. What is required for activation of a FTZ by customs?