The U.S. Foreign-Trade Zone (FTZ) program was created in 1934 by Congress as an incentive to encourage companies to keep investment and jobs in the United States and not move production offshore. The program removes certain costs and barriers that do not exist in foreign locations.
A foreign-trade zone is a designated area within the United States that is considered to be outside the stream of international commerce. Certain types of merchandise may be admitted into the zone without being subject to Customs duties or certain excise taxes.
There are two types of zones: General Purpose Zones and Subzones.
• A General Purpose Foreign-Trade Zone (FTZ) site is established to accommodate a number of companies and multiple activities. It is typically defined as an industrial or commercial park. Public warehouse operations also operate as General Purpose Foreign-Trade Zones.
• A Subzone is a special purpose zone established for a single company.
There are more than 250 foreign-trade zones throughout the United States. In Northeast Ohio, FTZs 40 and 181 include 50 sites covering more than 11,000 acres.
Typical zone users:
• Most automotive assembly plants and OEM suppliers
• Oil refineries
• Distribution companies
• PL public warehouse operators
• Pharmaceutical companies
• Instruments, electronics, computer manufacturers