Foreign Trade Zone

Summary of Foreign Trade Zone

An enclosed area in or near a port of entry that, while located on American territory, is effectively outside the customs jurisdiction of the United States. Such zones were authorized by the Foreign Trade Zones Act of 1934 as areas where foreign products might be entered, stored, manipulated, manufactured, and exported without imposition of customs duties or similar limitations, with the exception of certain operations involving liquor, tobacco, firearms, and a very few other items. Virtually any merchandise may enter into the zones. Every port of entry is entitled to at least one zone, which must be operated by a municipal authority or a private corporation, expressly authorized by local statute.

(Main Author: William J. Miller)