Special Economic Zones (SEZs) are usually carved out as geographical locations within a country that are incentivized, through provision of high-quality infrastructure, attractive fiscal incentives and minimum regulation to carry out certain economic activities with the aim of mostly generating foreign direct investment or boosting local investment in certain economic sectors.
Sometimes there are requirements that mandate that the Special Economic Zone areas to be physically demarcated from the rest of the area just to clearly set it apart from the rest of the area.
For an entity to benefit from the exemptions available to SEZ, they must be licensed to operate as a Special Economic Zone Enterprise or a Special Economic Zone Operator or Developer.
The distinction that is made between a Special Economic Zone Developer/Operator and Special Economic Zone Enterprise is that an SEZ Developer/Operator is a company that is licensed to set up develop or operate a Special Economic Zone, while an enterprise is any business enterprise set up to carry out activities eligible to be carried out in a particular SEZ. There is a legal requirement that Special Economic Zones Enterprises should be set up within the Special Economic Zones.
As we have stated in our past articles, SEZ’s benefit from the application of different legal regime that exempts them from certain legal obligations such us taxes, licensing e.t.c. Read article on Benefits of SEZs Here.
For small and medium enterprises to take advantage of these benefits available to SEZ’s they must set up their business in the Special Economic Zones and engages in activities that support the ecosystem of activities that a particular SEZ purposes to undertake and obtain licenses to operate.
Currently Special Economic Zones are created as either Public SEZ’s or Private SEZ’s. Public SEZ’s are developed and managed by the government while Private SEZ’s are developed and managed by private developers.
SEZ’s are also designated as multi-sector or single- sector SEZ’s and may include:
(a)free trade zones;
(b) industrial parks;
(c) free ports;
(d) information communication technology parks;
(e) science and technology parks;
(f) agricultural zones;
(g) tourist and recreational zones;
(h) business service parks;
Below we list some of the SEZ’s in the country and highlight their geographic locations.
Public SEZ’s
Public SEZs include;
Dongo Kundu SEZ
This SEZ which is a multi-sector SEZ which is licensed to act as an Industrial park and Free Trade Zone.
Dongo Kundu SEZ is approximately 3,000 acres large, adjacent to the Mombasa Port in Likoni Sub-County of Mombasa County.
Its strategic location, next to Mombasa Port which is Kenya’s main gateway for international trade makes it ideal for firms targeting global markets and export-oriented industries.
Mombasa Industrial Park SEZ
Mombasa Industrial Park SEZ is being developed by the Mombasa County government. It is designed as Multi-Sector SEZ acting as an Industrial park and Free Trade Zone.
Naivasha SEZ
Naivasha SEZ is located on 1000 acres of land in Mai Mahiu in Nakuru County along the Nairobi - Naivasha Standard Gauge Railway (SGR) line. Once development is complete, the SEZ will offer trans-shipment facilities to allow the seamless interchange between SGR and Meter Gauge Railways (MGR) to handle the cargo destined for EAC and Central African Countries. The SEZ comprises of an Internal Container Deport and a Logistics Zone, Railway Marshalling Area and Industrial Parks.
Konza Technopolis SEZ
Located in Malili, Makueni County on 5,000 acres of land. The area will also be connected with Mombasa-Nairobi SGR.
PRIVATE SEZ’s
Private SEZ’ include Tatu City in Kiambu County, Africa Economic Zones in Uasin Gishu, Compact Free Trade Zone in Nairobi, Northlands in Kiambu, Mount Kipipiri Golf & Resort in Nyandarua and East Africa Free Zone in Mombasa.
These SEZ’s are at various stages of operationalization.
CONCLUSION
While SEZ’s mostly primarily target Foreign Direct Investment, local investors can also take advantage of the incentives available to SEZ’s and set up Small and Medium sized enterprises within the SEZs.
HOW CAN WE HELP YOU?
At CM-SME we help SMEs that would like to take of the incentives available to SEZ enterprises, apply for the licensing. We advise on the licensing requirements and help your business through the entire process from making the application to obtaining the license.
Related blogs & news
What is a Power of Attorney (POA)?
Power of Attorney (POA) is a formal instrument by which one person empowers another to represent him or act in his behalf in many matters including transactions for sale of land, registration of intellectual property, filing of lawsuits, signing off on documents, and opening of a bank account among many others. ...
Employee Consultation Before Redundancy
The requirement of consultation is not expressly provided in section 40 of the Employment Act, 2007. However, by dint of Article 2(6) of the Constitution, treaties and conventions ratified by Kenya form part of the law of Kenya. Kenya is a state party to the International Labour Organization (ILO) since 1964 and is therefore bound by the ILO conventions....
Employees Right To Information
The Employment Act, 2007, does not have an express provision on the employees’ right to information. However, Article 33(1)(a) of the Constitution of Kenya, 2010, provides that every person has the right to freedom of expression, which includes freedom to seek, receive or impart information or ideas. Article 35 (1)(b) of the Constitution 2010, further provides that every Citizen has the right to access information held by another person and required for the exercise or protection of any right or fundamental freedom. What information do employees have a right to? 1. Organizational goals and objectives Organizational goals and objectives are easily overlooked in the day-to-day business of getting the job done, but they should be provided, not just to new employees at induction, but to everyone regularly. Reinforcing an understanding of organizational goals and strategy helps employees feel like they are part of the business, which in return leads to improved job performance and engagement. Apart from the emphasis being made by the human resource manager, the line manager too should regularly remind his/her team of the goal and objective of the firm. The line manager together with his/her team may develop their department goals that align with the overall goal of the company. When a department has established its departmental goal, then it means they understand the goal and objective of the company. This in return leads to improved output and increased production. 2. Organizational policies and procedures Most organizations have rules, policies, and procedures that guide how they do things which is important for employees to know and understand. Depending on the company, the policies and procedures may be incorporated in the employee handbook or the human resource manual. How you collate this information is a matter of considering what works for you and the team, but the key is that you must make sure employees are aware of and understand all rules, procedures, practices, or policies with which they are expected to comply. This means they need to be written down somewhere and easily accessible. 3. Organization structure An organizational structure is the way that a company, organization, or team is set up. Every company and team has an organizational structure, even if it’s not formally defined. Organizational structures are important because they help businesses implement efficient decision-making processes and provide a clear org chart that helps businesses keep track of their human resources. Thus, the employees need to understand the organizational structure of the company because it guides all employees by laying out the official reporting relationships that govern the workflow of the company. A formal outline of a company's structure makes it easier to add new positions in the company, as well, as providing a flexible and ready means for growth. An employee who understands the organizational structure will be motivated to know that the company has a growth plan. 4. Feedback on performance Employees need to understand how well they are doing in their roles and what they can improve on. Regular constructive feedback is essential here, and the temptation to only pick them up on things they are doing wrong should be avoided. It is hard for you to do your best without information, and the same is true for your employees. If you withhold information unnecessarily, you will lose your talent. Maybe not today; but eventually those with choices will leave you. What information can be withheld from employees? Never use information withholding as power. If you are given 'secret' information, don't tell people you have it unless they ask you. If people ask you if you have information, be honest. Don't tell them you don't have information if you do. Tell them that you are not at liberty to share, and tell them why, e.g. "I've been asked to keep it confidential and I need to honor that request." If you establish a track record of early, honest information sharing, you will have more room to occasionally withhold information when the situation dictates. Information that should be kept confidential includes any information that could damage a company's reputation or ability to do business if that information becomes public. Such information is proprietary or sensitive. This information includes information whose disclosure is likely to: a. Impede the due process of law and procedures of the company; b. Endanger the safety, health, or life of any person; c. Involve the unwarranted invasion of the privacy of an individual; and/or d. Substantially prejudice the commercial interests, including intellectual property rights, of the company or third party from whom information was obtained. In the words of Sam Walton, Wal-Mart Founder: I guess our greatest technique and our greatest accomplishment is the commitment to communicating with employees in every way that we possibly can and listening to them constantly…you've got to put their interest first, and eventually, it will come back to the company....
The legality of Non-Compete Clauses in Kenya
A non-compete clause is a contractual agreement between two parties, typically an employer and employee, where the employee agrees not to engage in certain business activities that would be considered competitive with the employer's business. The purpose of a non-compete clause is to prevent the employee from working for or starting a business that would compete with the employer during and after their employment....
Why SMEs should use documents drafted by an Advocate for their Businesses
Here are some reasons why SMEs should use documents drafted by an Advocate: 1. Compliance with the Law. SMEs are subject to various laws and regulations. An Advocate can help SMEs navigate the complex legal landscape and ensure that they comply with all relevant laws and regulations. Non-compliance can lead to significant penalties, which can be detrimental to the business....
Share this blogLinkedIn Twitter Facebook Print