Criteria defined for SEZs under CPEC

The criteria for establishment of Special Economic Zones (SEZs) under China-Pakistan Economic Corridor (CPEC) stipulates a minimum area of 50-acres (with no maximum limit) and allows zone developers, private or in public-private partnership, to purchase land on ownership or lease from central/provincial/local governments.

Officia documents carry other major conditions for establishing SEZ’s are: (i) 10-year income tax holiday both for zone developers and zone enterprisers and one time exemption on import of capital goods for establishment of zones and projects in the zones; (ii) maximum land that each SEZ can allocate for commercial use and other non-productive activities such as setting up retail shops, recreational areas, hospitals etc would be limited to 10 per cent of total land area; (iii) investors must begin construction within six months and production within 24 months of project approval, the land title will not be transferred to the investors until after it has been in production for six months; (iv) the government is committed to providing infrastructure and utilities up to the gate level of the SEZ; (v) Board of Investment (BOI) would provide one window facility within the zone for facilitation of the investors; (vi) Zone developers, once approved for SEZ status, shall have authority to develop their master plans, allot land and approve individual investors in compliance with the rules; (vii) the incentives protected by law cannot be withdrawn; and (viii) the policy allows existing Zones/Industrial Estates to apply for the status of SEZ.

The documents that would be required with zone application a preliminary zone development plan which shall: (a) define the geographic boundaries of the proposed SEZ, (b) set out the basic infrastructure development requirements, both inside and outside the proposed SEZ necessary for the proper functioning of the proposed SEZ, (c) set out the land requirements of the proposed SEZ, (d) set out the details of the current ownership of the proposed land, (e) a detailed analysis of prices as per sale deeds executed & registered within last five years as per official record, (f) set out the manner in which land required shall be procured, including specifically whether land will need to be acquired under the Land Acquisition Act 1984, (g) set out a geotechnical study and topographical survey of the proposed land, (h) SEZ plan encompassing Development Plan, Marketing Plan, Financing Plan and Management Plan, (i) cost of preparing the land based on technical estimates including but not limited to geotechnical and topographical survey etc, and (j) set out what criteria shall be applicable to the admission of zone enterprises into that SEZ.