Free Trade Zones

Free trade zones (FTZ) are non-residential areas designated by the government where companies receive special benefits. FTZs can be managed privately or by the National Port Authority (E.N.P.). The E.N.P. approves all permits to operate in the designated areas and maintains the established guidelines put forth in the FTZ. The FTZ law was originally established to create the Puerto Cortés Free Zone. In 1998, however, the government extended FTZ benefits to the entire nation.

A company located in a free trade zone, industrial park or export processing zone (ZIP) is exempt from payment of import duties on goods and capital equipment, charges, surcharges, selective consumption taxes, and sales taxes. In addition, the production and sale of goods within these areas are exempt from Honduran federal and municipal taxes. Firms operating in these zones are exempt from income tax for 20 years and municipal taxes for 10 years, and there are no controls or restrictions over the use of foreign exchange or the repatriation of capital profits. The movement of imported components and exported products is handled with a minimum of paperwork and is normally done within hours. Firms operating in the FTZ must grant workers all benefits established by Honduran labor legislation.

Privately owned Tourism Free Zones (ZOLT) may be established to promote tourism industry development in Honduras. Legislation covering ZOLTs allows the free importation of equipment, supplies and cargo/passenger vehicles that will exclusively benefit the ZOLT and the construction of its installations. Import benefits also apply to boats, yachts, and aircraft that will be used exclusively for the Tourism Free Zone. Authorization requests for operating a ZOLT must be approved by the Ministry of Tourism and the Ministry of Industry and Trade. Revenues generated in ZOLTs are subject to Central Bank regulations.