At A Glance: “The Bangladesh Economic Zone Act No. 42 of 2010”

The Bangladesh Economic Zone Act (Amendment), 2015 (Act No. 29 0f 2015)

Act No: 42 of 2010

Published Date: 1^st August, 2010.

Amendment

Act No: 29 of 2015

Published Date: 26^th November, 2015.

 

Bangladesh is a developing country. Achieving economic development is one of the other major goals of Bangladesh. To meet the goal, the government took the initiative to establish an economic zone. In 2010, the government has published an act for the establishment of economic zones in all potential areas and underdeveloped regions and development, operation, management and control thereof including the matters ancillary thereto with a view to encouraging rapid economic development through increase and diversification of industry, employment, production and export.

Now there are 88 economic zones all over the country, 59 of which are government economic zones and 29 are private economic zones. The Bangladesh Economic Zone Act, 2010 has 41 sections. Some sections of The Bangladesh Economic Zone Act, 2010 have been amended by the government in 2015. Now it is titled as ‘The Bangladesh Economic Zone Act (Amendment), 2015 (Act No. 29 of 2015). 

Discussion on important sections under of ‘The Bangladesh Economic Zones Act, 2010’ (with amendment, 2015) given below:

1. Short title and commencement:

    When the law was enacted, then it was known as ‘The Bangladesh Economic Zones Act, 2010’. However, in 2015 after an amendment was done which is now known as ‘The Bangladesh Economic Zone Act (Amendment), 2015 (Act No. 29 of 2015). 

2. Definitions:

    When the act was enacted in 2010, under section 2, there were 11 issues. Those issues are- (1) Economic Zone, (2) Economic Zone Developer, (3) Authority, (4) Governing Board, (5) Chairman, (6) Executive Bard, (7) Executive Chairman, (8) Prescribed, (9) Regulation, (10) Rules, and (11) Secretary.

3. Amended portion:

But in 2015, issues no. 9 was amended. A sub section was added under issue 9, that 9(A).

9(A) – “Partnership or initiative between the Government of Bangladesh and the Government of any other country”, means any other body or institution which is nominated by the government of Bangladesh or nominated by the government of Bangladesh and partnership initiative of an industrial entrepreneur, consortium, joint venture company or industrial group capable of establishing, operating and expanding an economic zone nominated by the government of another country or that government.”

4. Establishment of economic zones:

    Under this section here has described the establishment of economic zones in the country. Under this section there were four (4) sub-sections. But under the amendment of 2015, there has been added two (2) sub-sections more. Those are – 4(e) and 4(f). Under those sub-sections, that has been described-

4(e) – Any other body or institution which is nominated by the government of Bangladesh or nominated by the government of Bangladesh and partnership initiative of an industrial entrepreneur, consortium, joint venture company or industrial group capable of establishing, operating and expanding an economic zone nominated by the government of another country or that government.

4(f) – Economic zones established in mutual cooperation or partnership between one or more government agencies or authorities or institutions.

Other sub-sections are kept unchanged and in action beside these.

5. Site selection and declaration of economic zones:

    Under this section, sub-section 5(3), no economic zone shall be declared on any land within City Corporation, Municipality or Cantonment Board area.

But under “The Bangladesh Economic Zone Act (Amendment), 2015” there has been made an amendment. There has added in 5(1) that, “Only in case of IT related economic zones, the area mentioned in section 5(3) can be declared as a public interest economic zone. 

6. Acquisition of land for economic zones:

    According to sub-section 6(1) of section 6, states that if the land is required for any of the infrastructural needs of the economic zone, the government will provide the land under “Acquisition and Requisition of Immovable Property Ordinance, 1982 (Ordinance No. II of 1982).

7. Division of an economic zone into several areas:

    According to the subsection of 7(1) any economic zone divides into three (3) areas. They   are –

1. Export Processing Areas, which is, specified for export oriented industries.
2. Domestic Processing Areas, which is, specified for industries to be established to meet the demand of the domestic market.
3. Commercial Areas, which is, specified for business organizations, banks, warehouses, offices or any other organizations.
4. Non-Processing Areas, which is, specified for residence, health, education amusements, etc.

But under the amendment of 2015 (Act No. 29 of 2015), there has been added two (2) sub-sections more. Those are – 7(a) and 7(b).

8. Appointment of economic zone developers:

    Under this section the authority may appoint economic zone developers. But under the amendment of 2015 (Act No. 29 of 2015), a sub-section was added in the title of sub-section 8(2) in the act. 

9. Special tariff benefits for economic zones:

      Under this section, it has described that, the government by notification in the official Gazette, provides tariff benefits to the economic zone or any area of it, for a specific period and in accordance with the provisions of the Customs Act, 1969 (Act No. IV of 1969), introduced a special arrangement to facilitate import and export operations of the organizations established in the economic zone.

10. Financial benefits, etc:

      In this section it has explained that all types of financial incentives and benefits to the industrial units within the economic zone will be provided by the government, according to the Bangladesh Export Processing Zones Authority Act, 1980 (Act No. XXXVI of 1980) and Bangladesh Private Export Processing Zones Act, 1996 (Act No. XX of 1996). 

11. Other benefits:

       Under this section, sub-section 12(1), all other benefits by the governments under this act for the industries within the economic zone will get through the “One Stop Services” which are shortly known as “OSS”. 

12. Permission to conduct banking activities in an economic zone:

      For all types of banking activities by any bank either public or private bank(s) in any economic zone will be done by the approval of the Bangladesh Bank. 

13. Establishment of industries in an economic zone:

      This section describes that, except the sectors identified as reserved industries in the existing industrial policy of the Government, establishment of any sector such as agricultural farms, service oriented organizations etc. including small and cottage industry may be set up in the economic zones.

14. Allotment of land, etc:

      Under this section it has explained that, when an individual is permitted to establish an industry or commercial organization in an economic zone, the authority allot him any land, building, or site within the economic zone, or lease the same by rent or otherwise.

15. Establishment of the authority:

      Under this section, some important issues for the creation of authority have explained. Under sub-section 17(1), an authority which is now known as “Bangladesh Economic Zone Authority” has been established.

Under sub-section 17(2), this authority is a body corporate having perpetual succession and a common seal, with power to acquire, hold and dispose of property, both movable and immovable, and by the said name sues and issued.

16. Head office of the authority:

      This act has mentioned that, the head office of this authority shall be located in Dhaka (Now its head office in Dhaka, under Prime Minister Office) and if necessary with the prior approval of the Government, can establish branch offices at any place in Bangladesh.

17. Duties and functions of the Authority:

      Under this section what duties and functions will be performed by the authority has explained. Some majors’ are-

• To identify and select sites for industrial or similar sectors on availability of local resources and etc.
• To acquire land for economic zones by own initiatives or public-private partnership and take possession of the acquired land on behalf of the Government.
• To appoint economic zone developers etc.
• To prepare infrastructure development plans of economic zones etc.
• To allot or lease or rent of land, building or site on competitive commercial basis in prescribed manner and etc.
• To ensure infrastructure development of economic zones within specified periods.
• To create opportunity or employment and etc.
• To ensure efficient use of land.
• To encourage more efficient management and monitoring programmers for implementing commitments on environment and other matters.
• To take appropriate steps to implement poverty reduction programs.
• To take necessary steps to implement social and economic commitments.

18. Operation etc. of the authority:

      Under the subsection 20(1) of this section has explained that all operation and administration of the authority shall vest in an Executive Board and the Executive Board will exercise all powers and perform all functions as by the exercise and performed by the authority.

Under subsection 20(2) of this section has explained that this executive board in discharging its duties or performing its functions will follow the orders, directives and guidelines by the Governing Board.

19. Governing Board:

      Under the subsection 21(1) of this section, the Chairman of this Governing Board is the Prime Minister.  Also the Ministers /State Ministers of different ministries as per selection will be members of this board. Besides them a good number of selected people will be the member of this Governing Board.

20. Functions of the Governing Board, Policy implementation, etc:

      This section explains all of the functions, duties and policy implementation processes of the Governing Board. Some of those are-

• To formulate policy regarding development, operation, management and control of the economic zones.
• To monitor the activities of initiating companies engaged for operation, administration, management and control of the economic zones.
• To approval for establishing economic zones.
• To review the overall activities of the Executive Board and the affairs of the economic zones from time to time.
• To give necessary orders or directions to the authority to ensure efficient management of the authority and economic zones.

21. Meetings of the Governing Board:

      Under the subsection 23(3) of this section, the Chairman will preside over all meetings of the Governing Board. But in his absence a member authorized by the Chairman, who is a Minister, will preside over the meetings.

22. Executive Board:

      Under the subsection 24(1) of this section, the Executive Board will consist of a Chairman and three members. 

23. Meetings of the Executive Board:

      Under subsection 25(3) of this section, the Executive Chairman will preside over all meetings of the Executive Board and in his absence the senior most of the members will preside over the meeting.

24. Committees:

      The authority may form necessary committees consisting of the Chairman or members or any officers of the Executive Board or any other persons in order to assist in performing its functions and the duties and functions of such committees will be determined by the Authority.

25. Ability to borrow:

      By this section, by the approval of the government, the authority can borrow money from any bank or financial institutions or any other sources.

26. Accounts and audit:

      Under this section, the sub-section 32(2) of this section, without prejudice to the provisions of the Comptroller and Auditor-General (Additional Functions) Act, 1974(Act, No. XXVI of 1974), the accounts of the Authority shall be audited by an auditor, who is a Chartered Accountants within the meaning of the Bangladesh Chartered Accountants Order, 1973 (President’s Order No. 2 of 1973) and the Authority, with the prior approval of the Governing Board, appoint the auditor and pay him such remuneration as may be prescribed.

The sub-section 32(5) of this section, a written report will be submitted by the Auditor to the Government. And details of his works will be discussed in that report.

27. Compliance to Laws, connected with the environment. etc:

      By this section it is mentioned directly that, all the authorities of the economic zones shall be bound to comply with international commitments recognized by the Government of Bangladesh including compliance to all the existing laws on environment and environmental protection.

28. Applicability of laws on Workers Welfare Association and Industrial Relations:

     All the laws and rules, and provisions of the existing laws on EPZ Workers Welfare Association and Industrial Relations shall, with necessary modification, be applicable to the workers of the Special Economic Zones established under this act.

29. Special rights of the Authority:

      This section discussed those topics under sub-sections of 35(1), (2), and (3) which are related to the relationship of their own authority and the Government.

This is an overview of the major sections of BEZA Act 2010 and amendment of BEZA Act 2015. Here main and amendment of the acts discussed in detail.