The Min­istry of Trade and In­dus­try said yes­ter­day the Spe­cial Eco­nom­ic Zones (SEZ) Act, 2022 has been ful­ly pro­claimed.

A state­ment from the Trade Min­istry ex­plained that the new Spe­cial Eco­nom­ic Zones regime rep­re­sents a holis­tic in­vest­ment frame­work, which aims to at­tract lo­cal and in­ter­na­tion­al in­vest­ment, boost ex­ports and eco­nom­ic di­ver­si­fi­ca­tion, cre­ate new em­ploy­ment op­por­tu­ni­ties and en­cour­age in­creased pri­vate sec­tor par­tic­i­pa­tion in the econ­o­my, all with­in glob­al­ly ac­cept­ed stan­dards and best prac­tices.

The min­istry said on Ju­ly 5, 2024 Pres­i­dent Chris­tine Kan­ga­loo pro­claimed the act.

It was par­tial­ly pro­claimed on Jan­u­ary 31, 2022, to al­low for the es­tab­lish­ment of the T&T SEZ Au­thor­i­ty (SEZA), the ap­point­ment of a board for the Au­thor­i­ty and the staffing and set­ting up of the SEZA.

The full procla­ma­tion of the SEZ Act re­peals the Free Zones Act and brings in­to ef­fect the SEZ Reg­u­la­tions, 2023. Those reg­u­la­tions al­low any pub­lic, pri­vate or pub­lic-pri­vate part­ner­ship to ap­ply to the SEZA for spe­cif­ic li­cens­es in which to func­tion in the new regime.

Some of the dis­tin­guish­ing char­ac­ter­is­tics of the SEZ regime, in­clude spe­cial­ly des­ig­nat­ed zones, a ro­bust in­sti­tu­tion­al frame­work, and a dy­nam­ic in­cen­tive frame­work.

The min­istry fur­ther ex­plained that the des­ig­na­tion of var­i­ous types of Spe­cial Eco­nom­ic Zones for spe­cif­ic types of ac­tiv­i­ties en­ables the Gov­ern­ment to en­cour­age ac­tiv­i­ties that are crit­i­cal to na­tion­al de­vel­op­ment, and fo­cus these in­vest­ments in ur­ban and rur­al com­mu­ni­ties through­out T&T.

It not­ed that the Spe­cial Eco­nom­ic Zones will be des­ig­nat­ed as one of the fol­low­ing:

* Free Port: a du­ty-free area, lo­cat­ed at a port of en­try where im­port­ed goods may be un­loaded for ware­hous­ing, repack­ag­ing or pro­cess­ing of im­port­ed goods for val­ue-adding ac­tiv­i­ties, and lo­gis­tics ser­vices and sales;

* Free Trade Zone: a du­ty-free area that ac­com­mo­dates spe­cif­ic ac­tiv­i­ties tar­get­ed for in­ter­na­tion­al trade;

* In­dus­tri­al Park: a pur­pose-built in­dus­tri­al es­tate that lever­ages do­mes­tic and for­eign fixed di­rect in­vest­ment in val­ue-added and ex­port-ori­ent­ed man­u­fac­tur­ing in­dus­tries.

* Spe­cialised Zone: a place des­ig­nat­ed for spe­cialised ac­tiv­i­ties in­clud­ing: man­u­fac­tur­ing, mar­itime ser­vices, avi­a­tion ser­vices, fish­ing and fish pro­cess­ing, agri­cul­ture and agro-pro­cess­ing, in­for­ma­tion and com­mu­ni­ca­tions tech­nol­o­gy, cre­ative in­dus­tries, fi­nan­cial ser­vices, med­ical tourism ser­vices, re­new­able en­er­gy, lo­gis­tics and dis­tri­b­u­tion, and busi­ness process out­sourc­ing.

* De­vel­op­ment Zone: area where ac­tiv­i­ties are fo­cused on the de­vel­op­ment of a spe­cif­ic ge­o­graph­ic re­gion with em­pha­sis on fac­tors such as em­ploy­ment, skills train­ing, en­tre­pre­neur­ship and rur­al de­vel­op­ment and over­all so­cial and eco­nom­ic de­vel­op­ment of the area.

The new SEZ regime com­pris­es of an SEZ Au­thor­i­ty, as well as three en­ti­ties—SEZ op­er­a­tors, SEZ en­ter­pris­es and sin­gle zone en­ter­pris­es.

The SEZ Au­thor­i­ty will pro­vide the nec­es­sary su­per­vi­sion and reg­u­la­tion of SEZs, and will be a crit­i­cal part of the over­ar­ch­ing gov­er­nance of the new SEZ regime.

The SEZ op­er­a­tor will be re­spon­si­ble for the man­age­ment of an SEZ, the SEZ En­ter­prise will be an en­ter­prise ap­proved by the SEZA and lo­cat­ed in a Spe­cial Eco­nom­ic Zone, while a Sin­gle Zone En­ter­prise will be a zone un­der whose op­er­a­tion is re­strict­ed to one busi­ness en­ti­ty.

The min­istry added that the SEZ in­cen­tive frame­work will be con­sis­tent with in­ter­na­tion­al best prac­tice, and en­hance the at­trac­tive­ness of the busi­ness cli­mate of T&T, while al­so pro­tect­ing the do­mes­tic rev­enue base to the great­est ex­tent pos­si­ble.

"These in­cen­tives, which will be con­di­tion­al on trans­par­ent el­i­gi­bil­i­ty cri­te­ria, in­clude a 15 per cent cor­po­ra­tion tax rate, and ex­emp­tions and waivers on cus­toms du­ty, val­ue-added tax and oth­er tax­es. SEZ en­ti­ties will al­so ben­e­fit from non-fis­cal in­cen­tives that in­clude an en­hanced op­er­at­ing en­vi­ron­ment through har­mo­nized and ef­fi­cient reg­u­la­to­ry ap­provals to im­prove the ease of do­ing busi­ness," the min­istry said.

Re­gard­ing tran­si­tion arrange­ments, it stat­ed that notwith­stand­ing the im­me­di­ate Re­peal of the Free Zones Act, ap­proval has been grant­ed via le­gal or­der for all en­ter­pris­es grant­ed un­der sec­tion 15(2) of the Free Zones Act pri­or to De­cem­ber 31, 2018, to con­tin­ue to be en­ti­tled to all ben­e­fits un­der the Free Zones Act in ac­cor­dance with sec­tion 88(2) of the SEZ Act, 2022 un­til 31 De­cem­ber 2024.

These en­ti­ties have been grant­ed a six-month tran­si­tion pe­ri­od to de­ter­mine if they are in­ter­est­ed in be­com­ing an op­er­a­tor, SEZ en­ter­prise or sin­gle zone en­ter­prise un­der the new leg­is­la­tion.