A Free Zone or Free Trade Zone or Free Economic Zone, is a designated geographical area where certain taxes or restrictions on business, employment or trade do not apply in the same manner that they apply to the country in which the zone is located. An area within which goods might land, be handled, manufactured or reconfigured, and re-exported without the intervention of the customs authorities.
Only when the goods move to consumers within the country in which the zone is located do they become subject to the prevailing customs duties. Free Zones are often organised around major seaports, international airports, and national frontiers - areas with many geographic advantages for trade.
A free zone
- is a special economic zone designated by the trade and commerce administration of various countries.
- allows 100% foreign ownership and no taxes - guaranteed for a specific period of time (depending on the individual free zones).
- offers comprehensive services for registered activities.
- has special tax, customs and imports regime and is governed by their own framework of regulations.