SEZ (Third Amendment) Rules 2022

Central government is actively working on "New SEZ Policy" which is expected to be introduced by end of this year to make SEZ units more attractive and to boost the domestic and foreign trade.

In the interim, considering the increasing trend for hybrid work model, the Ministry of Commerce and Industry has amended Special Economic Zone Rules 2006 and notified Special Economic Zone (Third Amendment) Rules 2022 on 14th July 2022.

Key features of amended rules have been discussed below.

Rule 43A has been inserted  to allow SEZ Units employees, including contractual employees to work from home or from any place outside the Special Economic Zone.

Procedure

• SEZ unit shall submit its proposal for work from home to the Development Commissioner through email or physical application.
• The Development Commissioner may grant the permission.
• SEZ unit may submit an application for extension of the permission.
• The Development Commissioner may extend the permission for such period, not exceeding one year at a time.

Q-1: What does such application shall include?

Ans: Such application shall include:

• Terms and conditions of work from home.
• Date from which the permission for work from home shall be utilized.
• The details of the employees to be covered by such permission for work from home.

Q-2: What is the validity of DC permission?

Ans: 1 year from the date of such permission.

Q-3: What is the maximum limit on number of employees for work from home? 

Ans: The proposal for work from home shall cover a maximum fifty per cent of the total employees, including contractual employees, of the Unit.

The Development Commissioner may approve a higher number of employees to work from home for any bona-fide reason to be recorded in writing.

Key timelines to be considered

• Every proposal shall be submitted, at least fifteen days in advance, except in case of the employees who are temporarily incapacitated or travelling.
• An Unit, where, its employees are working from home or from any place outside the Special Economic Zone on the date of commencement of the Special Economic Zones (Third Amendment) Rules, 2022 shall submit its proposal for permission to the Development Commissioner within ninety days from the date of such commencement.

Obligations on SEZ units

1. Maintain accurate attendance record for the entire period of permission for work from home and shall submit to the Development Commissioner, from time to time.
2. The work to be performed by the employee permitted to work from home under this rule shall be as per the services approved for the Unit, and the work is related to a project of the Unit.
3. The Unit shall ensure export revenue of the resultant products or services to be accounted for by the Unit to which the employee is tagged.
4. Where an employee ceases to be part of the project of the Unit, the employee shall be un-tagged from the Unit and the Unit shall surrender the identity card.
5. The Unit may provide to an employee such goods, including laptop, computer, video projection system, other electronic equipment and secured connectivity (for virtual private network, virtual desktop infrastructure) to establish a connection between the employee and work related to the project of the unit with the prior permission of the Specified Officer to temporarily remove such goods to the Domestic Tariff Area without payment of duty or IGST, subject to the following procedure, namely:-

• The unit shall account for the goods removed temporarily.
• The unit shall issue a certificate authorizing the employee by name and giving the full specification, namely, serial number and model number and make of the equipment intended to be taken  outside the processing area temporarily and a copy of the certificate shall be endorsed to the Specified Officer and acknowledgement received by the Unit.
• The Unit shall maintain a record of such certificate of authorization issued for temporary removal of equipment.