Trade Agreements, Origin & Policy
Free Trade Agreement
Also known as: FTA
A free trade agreement is a treaty between two or more countries that reduces or eliminates tariffs and other barriers on qualifying goods traded between them, creating preferential access that outsiders do not enjoy. Beyond tariff cuts, modern agreements often address services, investment, intellectual property, government procurement, and standards. The benefits flow only to goods that satisfy the agreement's rules of origin, so exporters must document that their products are genuinely made in a member country to claim the preferential rate — a requirement that makes origin compliance central to capturing an agreement's value.
A preference is a claim you make and must be able to defend, not a discount that arrives automatically. Importers claim agreement rates on goods that merely ship from a partner country, without ever testing whether they originate there under the rules. That is a false statement on an entry, made with entirely good intentions.
Where it matters for compliance
- The importer makes the claim and bears the burden of supporting it on verification.
- Retroactive claims are possible within statutory limits where the goods qualified at entry.
Related terms
Reviewed by a licensed customs broker. Definitions are general information, not legal or customs advice for a particular shipment. Duty rates, tariff programs and agency requirements change frequently.