Fourteen years after it was first approved, the Spokane-area foreign trade zone has its first customer.

Inland Empire Distribution Systems Inc., a Spokane Valley-based warehousing company whose facility is considered part of the trade zone, secured earlier this month its first customer who will use the designated zone, says Matt Ewers, IEDS's vice president of business development.

He declines to disclose the name of the company or the types of products it transports to the U.S. due to security concerns, but he says the company is transporting goods to the U.S. from Alberta, Canada, and storing them in part of IEDS's 324,000-square-foot facility in the Spokane Business & Industrial Park, at 3808 N. Sullivan in the Valley.

Foreign trade zones are established throughout the U.S. to allow a company to defer duties, which are taxes on imports, until that company is ready to ship its products elsewhere. In some cases, Ewers says, a company can transport a product to a foreign trade zone, make improvements to it, and ship it out of the U.S. without ever having to pay a duty.

"That can have a positive impact on cash flow," Ewers says.

Spokane International Airport spokesman Todd Woodard says the airport's board of directors first established a foreign trade zone in 1997 in hopes that it would be an economic development tool. In late 2002, it extended the zone to IEDS.

Woodard says he hopes now that one company has signed on, others will follow.

"Once you get the practical example, the sense of risk dissipates," Woodard says. "I think this is a huge springboard."

Up until recently, Woodard says, there wasn't a company using the trade zone that advocates could point to as an example of how it works locally.

"It wasn't for lack of trying, I'll tell you that," he says.

For a foreign trade zone to be a feasible option, a number of factors must be in place, Ewers says. First, a company must be bringing to the U.S. goods on which there is a duty. Also, there are upfront costs involved in using a zone, so it wouldn't make sense to set up in the zone for a one-time shipment, he says. A company would need to ensure it was bringing in a volume of goods that was such that it could recuperate, though duty deferral or duty elimination, upfront costs.

In addition to serving as a foreign trade zone, IEDS operates a Bureau of U.S. Customs and Border Protection container freight station at its Valley location, at which goods can clear customs.