NA panel approves amendments to SEZs law allowing free land leases, sets up tribunal for disputes

The National Assembly Standing Committee on Finance has approved amendments to the Special Economic Zones (SEZ) law, allowing the government to lease state land free of cost to private developers and creating a separate tribunal for dispute resolution, The Express Tribune reported. 

The committee cleared the Special Economic Zones Amendment Act 2026 without clause-by-clause discussion, following its introduction in the National Assembly on April 8.

Under the proposed law, the government plans to lease up to 6,000 acres of land in Karachi to developers, with individual allocations of up to 1,000 acres, although lease terms are yet to be finalised.

The amendments also provide that more than one developer can be selected for zones larger than 1,000 acres, with each receiving a minimum of 500 acres.

To address delays in commercial litigation, the committee approved the establishment of a Special Economic Appellate Tribunal with exclusive jurisdiction over SEZ-related disputes, barring other courts from taking up such cases.

The tribunal will be required to decide cases within three months, with appeals allowed only in the Supreme Court within 60 days.

The law also proposes the creation of a federal SEZ Authority to oversee zones in federal territories, replacing the Board of Investment’s role in processing applications.

Private developers will be responsible for zone development, while federal and provincial governments will provide roads and utilities, including electricity, gas and telecom services, within one year of notification.

The committee approved continuation of income tax exemptions for enterprises for up to 10 years or until June 30, 2035, whichever comes earlier.

Officials said the timeline aligns with Pakistan’s commitments under the $7 billion IMF programme, which requires phasing out incentives by 2035, though the government is seeking flexibility and plans a pilot project from 2028.

The amendments reflect efforts to attract investment into SEZs while balancing IMF conditions and addressing investor concerns over regulatory and legal hurdles.