Foreign Trade Zone (FTZ)
Customs Bonded Warehouse (CBW)

Foreign Trade Zone (FTZ)

CDS is an approved general-purpose Foreign Trade Zone Operator.

Q: What is a Foreign Trade Zone?

A:  A Foreign Trade Zone is a designated area located inside the United States in which US Customs considers the commercial merchandise inside the area outside the commerce of the United States.  Although Foreign Trade Zones are considered international commerce space, they remain under the jurisdiction of US local, state, and federal agencies. The purpose of the Foreign Trade Zone is to encourage foreign commerce within the United States.  


Q: What are the benefits of using an FTZ?


1. Deferred, Lower, or Eliminated Duties – companies may defer, lower or eliminate duties during reassembly or manufacturing preparation of products for entry or re-export. 
2. Damaged or Non-Conforming Items – the FTZ is utilized to inspect, repair, repack, remove or destroy damaged and defective products prior to be subject to import duties and taxes.
3. Exportation Requirements – Using an FTZ as an export distribution center can provide big benefits to support selling goods into international markets.
4. Inverted Tax Relief – Some products the individual parts incur more duties and taxes than the finished product.
5. Inventory Tax – Warehousing items in an FTZ allows inventory to remain duty and tax free until its necessary to enter the US Commerce.  This can greatly benefit landed costs. 
6. Additional benefits:
a) Improve cash flow
b) Improve compliance and reduce regulatory requirements for re-export
c) Improve inventory management

d) Upon permission from the Department of Commerce FTZ Board, goods may be sorted, destroyed, cleaned, graded, mixed with foreign or domestic goods, labeled, assembled, manufactured, exhibited, sold and repacked.

Customs Bonded Warehouse (CBW)

CDS Air Freight has a Customs Bonded Warehouse (Activity Code 2, Class 3) assisting our customers with imported freight requiring inspection and release by US Customs and Border Protection. Additionally, our designated Container Freight Station (CFS) is also an Activity Code 3, Class 3 warehouse.  


Q: What is a Customs Bonded Warehouse?

A:  A Customs Bonded Warehouse is a building or secure area in which imported dutiable merchandise may be stored without payment of duty for up to 5 years from the date of importation. 


Q: What are the benefits of Customs Bonded


1. Cost savings with deferred duties.
2. Duty free storage up to 5 years.
3. Safe-haven for restricted goods.
4. Importing and international shipping.
5. Minor product manipulation.


Foreign Trade Zone

Customs Bonded Warehouse

Admission | Entry

Not considered within US

Within US

Customs Bond

Not Required


Permissible Cargo

Foreign and Domestic

Foreign Only

Duties and Taxes

Deferred, Lowered, Exemptions

Deferred Only

Payment of Duties

Upon US Entry

Prior to release

Storage Period


Not to Exceed 5 Years



Not Permitted

Exchange Rate

At time of withdrawal

At time of entry