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Free trade zone

A free trade zone is any location where goods can be shipped, handled, manufactured, reconfigured and re-exported without the involvement of customs agencies. A major seaport, an international airport or a border facility between two or more countries may be designated a free trade zone.

Customs duties are applied when goods are shipped outside the free trade zone.

More about free trade zones

Where a free trade zone does not exist, a company selling products into a foreign market may use a bonded warehouse to store goods without paying duties.

Related definitions

Find out more in our glossary