What Is FTZ Warehouse | Benefits for Sellers

Maybe you have long known, maybe you heard of it for the first time, today we will learn about the FTZ warehouse in the United States, which may be of great help when it is critical.
FTZ warehouse, here FTZ is Foreign Trade Zones, that is, we are familiar with the Free Trade Zones, a difference of one word means one. What kind of goods can be put in FTZ warehouse?

What kind of goods can be stored in FTZ warehouse? What can be done in FTZ? The most important point: what are the benefits of FTZ warehouse?

The most important features of FTZ warehouse

FTZ warehouses are regulated by the U.S. Customs CBP, but outside the scope of CBP. On the action of customs clearance, Free Trade Zones warehouse has not entered the scope of CBP.

Simply put, as long as it is not prohibited by U.S. law to import and local goods, regardless of whether to tax, can be placed in the Free Trade Zones warehouse. However, if the goods are subject to a quota, entering the FTZ warehouse is not exempt.

This article has more details about the duty free zone:

What Is Free Trade Zone | Effective Guidance


FTZ warehouse


The biggest advantage of ‘s FTZ warehouse

Foreign goods entering the FTZ warehouse are not subject to the normal customs clearance process (CBP entry procedure) and payment of duties until the goods enter the U.S. consumer market, at which time the importer may choose to declare and pay taxes in accordance with the import duty rate for imported raw materials or finished goods (if processed in the FTZ warehouse).
For U.S. local exports, once the goods enter the FTZ warehouse, you can enjoy the relevant export tax rebates or subsidies.

Benefits of FTZ Warehouses

The benefits of this type of warehouse are obvious.

Goods entering the Free Trade Zones warehouse are not subject to customs duties and taxes are only paid when the goods are transferred to the U.S. market for consumption.

Goods exported from an Free Trade Zones warehouse are not taxed.

Theoretically, goods can be stored in an Free Trade Zones warehouse indefinitely. As mentioned earlier, if the goods are processed in an Free Trade Zones warehouse, the importer is free to choose to pay the lower of the tax rate on the imported raw materials or the finished product.


FTZ warehouse


FTZ warehouse is not new, but in today’s U.S.-China trade is facing more technical barriers and uncertainty, this kind of warehouse may be able to save major losses at the critical moment.

For example, a shipment of sensitive goods (so-called forced labor) is inspected by U.S. Customs, and a lot of information needs to be submitted to prove compliance. The key question is whether this one vote behind the goods or more goods are already at sea. At this point the importer is faced with several options.

This inspection is generally time-consuming, and so the back of the cabinet to the time, the first shipment may not have been checked and released. If the importer consciously unable to provide the documents required by Customs, it is simply behind the original shipment of goods back (return onboard).

However, if the importer feels innocent, confident that the information to prove compliance, the best way to deal with this time is to move the goods behind the Free Trade Zones warehouse, and then with the U.S. Customs to maneuver until the goods can be cleared for release.

In case in the end or can not convince the U.S. Customs, do not allow entry, the goods can also be easily returned from the Free Trade Zones warehouse, because after all, they have not entered the customs declaration system, it can be said that this “in and out of freedom” flexibility is the biggest selling point of the Free Trade Zones warehouse.


warehouse storage options


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