Draft SEZ Rules
The highlights of the Draft SEZ Rules:-
Minimum Area
(a) Multi Product Special Economic Zone - One Thousand Hectares
(b) Sector specific Special Economic Zones, including port or airport based Special Economic Zone- One Hundred Hectares With reduced area for Megahalya, Nagaland, Arunachal Pradesh, Mizoram, Manipur, Tripura, Sikkim, Jammu & Kashmir, Himachal Pradesh or Uttranchal.
Before recommending any proposal for setting up of Special Economic Zone, the concerned State should have either enacted its State legislation for Special Economic Zone or notified its Special Economic Zone policy supported by requisite notifications to provide for the following
While recommending a proposal for setting up of Special Economic Zone to Board, State Government shall indicate whether the area incorporated in the proposed Special Economic Zone is free from environmental prohibition.
Letter of Approval for Developer.- The Central Government shall, within 30 days of communication received by it under sub-section (9) of section 3 of the Act, grant a letter of approval in Form to the person or the State Government concerned or in Form C, if the approval is for providing infrastructural facilities in the Special Economic Zone,
The letter of approval for Developer shall be valid for a period of three years within which time effective steps shall be taken to implement the approval: Provided that Board may extend this validity period for a further period of two years, on merits.
Free Trade and Warehousing Zones may be created as stand alone Special economic Zones or as part of the Multi Product Special Economic Zones. The processing area and Free Trade and Warehousing Zone shall be fully secured by boundary wall or wire mesh fencing having a height of at least two meters and 40 centimeters above plinth level with top sixty centimeters barbed wire fencing with mild steel angle with specified entry and exit points, subject to the satisfaction of Development Commissioner:
the SEZ shall from the date notified, be deemed to be a Port, Airport, ICD, Land Customs Station under Section 7 of the Customs Act;
The Approval Committee may consider and permit conversion of Export Oriented Units or Software Technology Park Units or Electronic Hardware Technology Park Units into Special Economic Zone Unit provided it fulfils the requirements :
the Unit shall execute Bond-cum-Legal Undertaking with regard to its obligations regarding proper utilization and accountal of goods including capital goods, spares, raw materials, components and consumables including fuels, imported or procured duty free of and on earning of Positive Net Foreign Exchange Earning as provided under these rules;
Supplies from the Domestic Tariff Area to a Special Economic Zone Developer or Unit for their Authorized operations shall be treated as Physical Exports and all export entitlements for physical exports under the provisions of the Foreign Trade Policy, Customs Act including the Rules made there under, Central Excise Act and Rules made there under shall be admissible for such supplies :
the SEZ Importer shall file Bill of Entry for home consumption in quintuplicate giving description with specially stamped endorsement as “Special Economic Zone Cargo” along with Bill of Lading or Airway Bill and invoice and packing list with Authorized Customs Officer who shall register and assign a running annual serial no. and assess the Bill of Entry, on the basis of transaction value, which shall not require any Counter signature of the Proper Officer
The Unit may temporarily remove following goods to Domestic Tariff Area without payment of duty, namely: -
(a) Capital goods and parts thereof for repairs and return thereof;
(b) Sample goods for display, export promotion, exhibition and return thereof;
(c) Goods for job work, test, repair, refining and calibration and return thereof;
(d) Laptop or notebook computers or video projection systems for use by an authorized employee of a Unit or developer;
(e) Any other goods with the prior approval of the Authorized Officer;
Unit may remove following goods from Special Economic Zone to Domestic Tariff Area without payment of duty: -
Goods imported and admitted into Special Economic Zone after payment of duty of Customs as applicable are cleared into Domestic Tariff Area without any processing subject to the condition that identity of goods is established to the satisfaction of the Proper Officer;
Used packing materials except metal containers;
Computer and computer peripherals, including printer and plotter and scanner and monitor and key board and storage units donated with approval of the Proper Officer to recognized non-commercial educational institutions or registered charitable hospitals or public libraries or public funded research and development establishments or organizations of Government of India or Government of a State or Union Territory after two years of admission of goods and use by Unit, whether imported or procured from Domestic Tariff Area;
The Unit shall achieve Positive Net Foreign Exchange to be calculated cumulatively for a period of five years from the commencement of production according to the following formula: Positive Net Foreign Exchange = A – B > 0 Where: A: is Free on Board (FOB) value of exports, including exports to Nepal & Bhutan against freely convertible currency.