(2) Free Trade Area refers to the area between countries where the trade barriers have been substantially reduced and a free trade agreement has been signed. It is done to substantially reduce the trade barriers, tariffs and important quotas and increase the trade of goods and services and profitability between two countries. One of the well-known free trade areas was created by the signing of the North American Free Trade Agreement (NAFTA) on January 1, 1994. This agreement took place between Canada, the United States and Mexico encourages trade between these North American countries.