Salafchegan Special Economic Zone

Iranian President’s Office (Special Economic Zone)

Establishment and Management of Special Economic Zone Law of Islamic Republic of Iran was enacted in an open session by the Islamic Republic of Iran’s Consultative Assembly on Khordad 11,1384 (June 1, 2005) and was enacted by Islamic Republic of Iran’s Expediency Council on Azar 5, 1384(November 26, 2005) with several amendments by Note  of Article (1) and addition of a Note thereto and by Article (3) , Notes (1) and (2)  and addition of Article (24) thereto. The act was received in an enclosure to the letter No. 257/184168 by Islamic Republic of Iran’s Consultative Assembly dated Azar 29, 1384 (December 20, 2005) and is hereby advised in an attachment by president's office for implementation.

 Mahmud Ahmadi Nejad

President          

 Establishment and Management of Special Economic Zone Law of Islamic Republic of Iran

Part I -Objectives

Article 1-In order to protect economic activities and for the development of international commercial relations, mobility in the regional economy, production and process of goods, transfer of technology, promotion of non-oil export , creation of generative occupation, absorption and encouragement of domestic and foreign investment, re-export, transit and transship of goods , the government is entitled to establish special economic zones in the towns potentially capable of achieving above-mentioned objectives.

Note 1-Geographical scope, comprehensive and skeletal plan, type and scope of legitimate activities in special economic zones established for specific purposes shall be determined by the virtue of the provisions of the present Law and upon the proposal of secretariat and approval of Ministerial Board.

Note 2-Special economic zones shall be established by the approval of Islamic Republic of Iran’s Consultative Assembly.

Part II -Definitions and generalities

Article 2-The following words shall replace relevant long elaborate names or phrases in the present text of Law.

State: The State of Islamic Republic of Iran

Customs: The customs of Islamic Republic of Iran

Zone: Special Economic Zone

Organization: The organization in charge of the zone

Secretariat: Supreme Council Secretariat of Free Zones

Article 3-The Ministerial Board is entitled with the following responsibilities for the implementation of the present Law:

A-Determining or changing the organization in charge of the zone, governmental or non-governmental.

B-Supervising the activities of the zone within the framework of their specified programs and objectives

Note 1-Should it be necessary the Ministerial Board is authorized to establish a state-owned organization for the management of special economic zone. Articles of Association of such organization shall be approved by Ministerial Board upon the proposal of Secretariat.

Note 2-Determination of the organization in charge of the zone from among non-government legal entities depends upon the ownership (through official transfer by relevant state-owned bodies) and possession of the lands situated in the limits of that special economic zone by non-government legal entities before the issuance of permit by Ministerial Board. The rules of changing the organization in charge of the zone depends on the agreement concluded based on the present Law between Secretariat and the organization.

Article 4-The organization is authorized according to the bylaw approved by Ministerial Board to charge a sum of money in return for providing public services such as infrastructural, engineering, transportation, warehousing, loading, unloading, health, cultural, communicational, educational, and welfare services in addition to services provided by executive bodies. All real persons and legal entities engaged in the production of goods and services inside the zone are exempt of all duties usually charged by the State.

Article 5- The scope of activities of the organization is confined to legitimate activities stipulated by the Law.

Article 6- The annual budget of each zone managed by a state-owned organization shall be drawn up within the framework of government’s policies and planning and shall be approved in accordance to the provisions of the related Articles of Association.

Article 7-The organization in charge of the zone is authorized to issue permit for performing economic, constructive, cultural, and educational activities as well as providing services in accordance with the policies and regulations of the government and within the framework of comprehensive and skeletal plan approved by the zone.

Part III -Import and Export Regulations

 Article 8-Commercial transactions of the zone with abroad or other special economic zones and free-industrial zones , after being registered in customs , shall be exempt of all customs charges , commercial benefits and import and export customs duties and shall not be subject to any import and export limits and prohibitions except legal and lawful ones. Commercial transactions of the zone with other areas of the country except above-mentioned zones are subject to import and export regulations.

Note 1-Goods imported into the zone from other parts of the country for application and utilization purposes inside the zone shall be considered within the scope of internal transit of goods , whereas export of goods from zones to abroad is subject to Import and Export Regulations Law enacted on Mehr 4 ,1372 (September  26 ,1993).

Note 2-Exported goods the proceedings of which, banking or administrative, have been performed completely shall be considered as absolute exports after entering into the zone.

Note 3-Foreign raw materials and parts imported into the country for processing, converting, completing, or repairing are subject to temporal import regulations and shall be settled and returned to be used inside the zone without drafting customs declaration and issuing export permit or at least without performing customs formalities after they are processed, converted, completed or repaired.

Article 9-Import of goods at any levels by the passengers from zone to other parts of the country is prohibited.

 Article 10-Importers of goods into the zone are entrusted with the right to dispose of their goods, in full or in partial, to other parties against Negotiable Warehouse Receipt (NWR) issued by the organization of the zone. The holder of NWR is considered hereby as the owner of the goods.

Note 1-The director of the zone is authorized to issue certificate of origin upon the request of the applicants for the goods exported from the zone by the confirmation of Customs Administration of Islamic Republic of Iran. National banks have the obligation to accept the certificate of origin subject of the present Note.

Article 11-Goods produced or processed inside the zone when imported into other parts of the country shall be considered legitimate internal products to the extent of the total added value and the value of internal raw material and parts utilized in parts and shall be exempt of import customs duties.

Note 1-The terms of determining added value shall be clarified in the executive bylaw of the present Law.

Note 2-Foreign raw material and parts utilized inside the produce or processed goods shall be considered legitimate internal raw material and parts on the condition that their import customs duties are paid.

Commercial profit included in import customs duties of cars and their separate parts shall be determined by the observance of Art.(72) of  Drafting Part of State Financial Regulations Law enacted on Bahman 27, 1380 (February 16 , 2001).

Article 12-Customs of Islamic Republic of Iran has the obligation to accept the request of the owners of goods for direct transit of goods from other entrance roads into the zone and to provide them with due facilities and services.

Article 13-The director of the zone shall discern the duration of stay of goods entered the zone. Rules pertaining to the stay of goods inside places and areas of the zone shall b developed and exercised by the organization.

Part IV -Investment and Registration Regulations

Article 14-Terms of acceptance, import and export of foreign investment and benefit derived from it as well as conditions and the extent of contribution of foreigners to the activities of each zone shall be determined and exercised according to the provisions of Law on Encouragement and Protection of Foreign Investment enacted on Esfand 19, 1380 (March 10 ,2001) .

Article 15-Upon the request of the organization of the zone and according to bylaw approved by Ministerial Board State Registry of Deeds and Landed State Properties is duty-bound to take the following measures:

Aَ-Registering companies or company branches and agencies intend to perform activity inside the zone apart from the amount of their contribution to internal and external shares as well as registering material and spiritual ownership in the zone.

B- Separating properties and premises situated in the zone according to the view of organization of the zone and issuing related separable ownership deeds with the observance of state current laws.

Part V -Miscellaneous Obligations

Article 16-Affairs related to occupation of manpower, labor relations, insurance, and social security in the zone shall be executed according to approved current regulations of free trade-industrial zones.

Article 17-All rights of real persons and legal entities achieved before establishment of the zone shall be valid and continuation of activities within shall be legitimate within the frame work of comprehensive plan of the zone.

Article 18-Ministries, organizations, institutes, state-owned companies and state-affiliated companies shall provide the zone with due services including electricity, water, telecommunication, fuel, and other services within the scope of their legal duties and capabilities and based on currently approved prices of that geographical region.

Article 19-The zones are subject  to the present  Law and the organization in charge of the zone established by the date the present Law was enacted , in order to continue their activities , are duty-bound to come to the conformity with the provisions stipulated in the Law within the maximum of one year after the enactment of the same.

 Article 20-The boundaries of special economic zone are within the customs territories of Islamic republic of Iran and the customs is obliged to  be established at the entrance and exit roads in order to exercise import and export regulations with the observance of the provisions of Art.(8) of the Law.

Article 21-Activities performed inside each zone except those referred to in the Law are subject to other rules and regulations of Islamic Republic of Iran. 

Article 22-The state-owned organizations in charge of the zone is entitled to dispose of its own buildings and properties inside the zone to other parties based on established prices.

Note-Lands subject of the present Article shall be transferred by beneficiary real persons or legal entities upon the submission of Work Completion Certificate issued by the organization of the zone.

Article 23-from the date of enactment of the Law all legal rights, powers and duties of Agricultural Jihad Organization and Forest and Rangelang Organization in Lands and Natural Resources Affairs of each zone with state-owned or state-affiliated organization shall be born by the same organization.

Article 24-According to related rules the exercise of estate affairs shall be born by the organization.

Article 25- Executive bylaw of the present Law shall be approved by Ministerial Board upon the proposal of the Ministry of Economy and Finance, Ministry of Trade, State Management and Planning Organization, and Supreme Council Secretariat of Free Zones.

The above-said Law including twenty five Articles and twelve Notes was enacted in an open session by Islamic Republic of Iran’s Consultative Assembly on Khordad 11, 1384 (June 1 , 2005) with several amendments by the note of Art.(1)  and addition of a Note thereto it and by Art.(3 ) Notes ( 1) and (2) and addition of Article (24) thereto.

Gholam Ali Haddad Adel

  Parliament Speaker