Regulation of free economic zone “Ishkoshim"

Approved by the Decree

 of Majlisi Namoyandagon

Majlisi Oli of theRepublicofTajikistan

as of January 20, 2010, No.1545 

PROVISION ON FREE ECONOMIC ZONE “ISHKOSHIM” 

  1. General Provisions

1. This Provision is developed in accordance with the Law of the Republic of Tajikistan on “Free Economic Zones in the Republic of Tajikistan” and in accordance with the Provision on Free Economic Zones in the Republic of Tajikistan approved by the Decree of Majlisi Namoyandagon Majlisi Oli of the Republic of Tajikistan as of December 5, 2005, No.191 and shall determine the organizational, legal and economic basis for the activity of free economic zone of industrial-commercial type of the Free Economic Zone “Ishkoshim” (hereinafter referred to as “FEZ Ishkoshim”).

2. The main goals for the establishment ofFEZ“Ishkoshim” are the following:

- Encouraging the development of the economic potential of theRepublicofTajikistan, including by attracting the foreign and domestic investments, the introduction of best practice of governance and management;

- The effective involvement of the regional and country economy in the international differentiation of labor, the development of trade and economic cooperation with foreign countries, increasing the export potential of the republic;

- Ensuring the sustainable socio-economic development of the region;

- Establishing the modern engineering, transport, telecommunications, production and social infrastructure;

- Ensuring the population employment in the region and the republic, the creation of additional jobs, raising of population living standards and addressing the other socio - economic issues of the region.

3. The main objectives ofFEZ"Ishkoshim" shall include the following:

- The development of the economic potential of the zone based on the integration of foreign investments with the aid of material and financial resources of domestic enterprises and organizations on the basis of variety of forms of ownership;

- Attraction of the foreign and local assets, advanced equipment and technology, the introduction of the foreign managerial experience and new methods of management;

- Manufacturing application of domestic and foreign scientific and technical developments and devices and their subsequent use in other regions of the country;

- The establishment of a network of wholesome production, reducing production costs, maximum use of free labor, environmental and other local resources to produce the competitive products and goods for export and for the internal market;

- The establishment and development of theterritoryofFEZ"Ishkoshim, safety and protection of ecological environment;

- The establishment of the production infrastructure equal to international standards (communication, transportation, communications, etc.) within theterritoryofFEZ"Ishkoshim";

- The establishment of an independent budget forFEZ“Ishkoshim”. 

2. Status of FEZ "Ishkoshim" 

4. Status ofFEZ"Ishkoshim" shall be determined by its boundaries, legal framework and the special legal regimes as well as by the budget of the zone and its own administration.

5. FEZ “Ishkoshim" shall be established in the territory of Ishkoshim district of Gorno-Badakhshan Autonomous Oblast (GBAO) of the Republic of Tajikistan for the period of 25 years and shall consist of independent (limited) territories with the total land plot area of  200 hectares.

 6. The legislation of theRepublicofTajikistanwhich regulates the activities of theFEZ, shall govern the activity ofFEZ"Ishkoshim".

In respect of issues that are not directly regulated byFEZrelated legislation of theRepublicofTajikistan, the norms of the legislation regulating similar relations, which does not contravene with the existing legislation, shall be applied.

7. The special legal regime of land use, special customs, tax and other regimes established by this Provision and the Legislation of the Republic of Tajikistan, which regulates the activities of the FEZ shall be applied to the legal entities, the representative offices and branches of legal entities and individual entrepreneurs (the resident and non-resident of the Republic of Tajikistan), which carry out their activity within the territory of FEZ "Ishkoshim" (hereinafter referred to as - the entities of FEZ).  

            8. The interference of the government authorities shall, into the financial and economic activity ofFEZ"Ishkoshim" except for cases provided for in the legislation, be prohibited.

            9.FEZ"Ishkoshim" shall have an independent budget, set by this Provision, produced through the income and payments as well as other sources of funds that do not contradict the legislation of theRepublicofTajikistan.

10. The supervisory agency of FEZ "Ishkoshim shall be theFEZ«Ishkoshim" Administration (hereinafter referred to as – FEZ Administration).  

FEZ Management shall be established as a national government agency and shall operate on the basis of this Provision and the Charter approved by authorized state body responsible for the establishment, management and operation of theFEZin theRepublicofTajikistan(hereinafter referred to as - the authorized state body responsible for the management ofFEZ).

11.FEZ“Ishkoshim" shall prohibit the following:  

- Carry out the activity on the subsoil use from underground sources (except for the water supply of theFEZentities activity);

- Manufacture of the excisable goods except for the production of automobiles and other transport facilities designed for goods and passengers transportation;

- Production of the securities, banknotes and coins, postage stamps;

- Production, processing, storage, sale of narcotic drugs, psychotropic substances and precursors;

- Broadcast of the radio and television programs except for maintenance of radio and television;

- Production, processing, storage, disinfection, sale of hazardous and radioactive materials;

- Primary production of the ferrous and nonferrous metallurgy;

- Treatment of the mental illness and infectious diseases in an aggressive manner;

- Treatment of the animals having specially dangerous disease;

- Carry out an activity related to issues of foreign labor migration;

- Creation of the environmentally hazardous industry damaging the natural environment;

- Market, within the free economic zone, the fuel and lubricants by legal entities and natural persons who are not the entities ofFEZ;  

- Retail sale of the goods and raw materials except for retail sale of consumer goods subject to domestic consumption through the organization of FEZ activity on the trade and public catering set by the FEZ Administration;

- Economic and commercial activities in terms of ensuring the protection and national security as well as ensuring the production, processing, storage and sale of weapons, ammunition, explosives, narcotic drugs, psychotropic substances;

- Import, into theterritoryofFEZ, of the narcotic drugs, psychotropic substances, weapons, ammunition and other goods, sale and transportation of which is limited into theRepublicofTajikistan;

- Organization of gambling, lotteries, casinos, video halls, gaming machines etc.

12. Working regime ofFEZ"Ishkoshim" shall be established by the authorized state body responsible for the management ofFEZ. Working regime of theFEZentities shall be set by the FEZ Administration.

13. The export of goods to other countries shall be stimulated from theterritoryofFEZ Ishkoshim".

The mandatory requirements in terms of use of local raw and other materials to replace imports may not be imposed. 

3. Priority activities in the FEZ "Ishkoshim" 

14. Priority activities in theFEZ"Ishkoshim" shall include the following:

            - Industrial processing of agricultural products;

- Production of wool made goods, processing of fells of small cattle and bovine animals with the final release of finished leather goods, footwear and leather haberdashery;

- Manufacture of artificial and synthetic dyes;

- Manufacture of starch;

- Mechanical engineering (assembly and production of cars, tractors and of various brands of equipment subject to agriculture and other industries, production of spare parts for them, equipment, machinery and technologies subject to processing industry, equipment for services including water pumps and others equipment);

- Manufacture of non-metallic pipes for different sectors;

- Manufacture of electrical, electronic and household appliances;

- Production of mineral fertilizers and biological additives for agriculture;

- Processing of natural stones, production of building and processing materials;

- Production of modern building materials (glasses, windows and doors, heat retaining wall blocks and panels of international standards, plastic decorative materials (excluding the building bricks);

- Manufacture of gypsum;

- Manufacture of different types of electrical wires;

- Production of household waste (excluding primary processing);

- Manufacture of perfumes;

- Manufacture of pharmaceuticals and medicines;

- Manufacture of machinery and equipment for health care;

- Manufacture of lighting units and appliances;

- Valuation, credit, insurance, consulting, audit, leasing and certification activities;

- Activity on provision of information support;

- Activity related to the scientific and technological research, innovation, development of nanotechnology and biotechnology and others. 

4. Entities of FEZ “Ishkoshim" 

15. The legal entities, representative offices and branches of the legal entities, individual entrepreneurs (residents and nonresidents of theRepublicofTajikistan) shall be recognized as the entities ofFEZ"Ishkoshim", which:

- Passed the state registration in accordance with the legislation of theRepublicofTajikistan;

- Entered into an agreement with the FEZ Administration on the activity in theterritoryofFEZ"Ishkoshim";

- Obtained a certificate for the entity ofFEZ"Ishkoshim" in a manner provided for in this Provision.

16. Carry out their activity as the entities ofFEZ“Ishkoshim” in accordance with the Law of theRepublicofTajikistanon "Free Economic Zones in theRepublicofTajikistan", with this Provision and other normative legal acts of theRepublicofTajikistanregulating the activity ofFEZ.  

17. Carried out their activity within the territory of FEZ “Ishkoshim” prior to its establishment, within 1 year from the date of functioning of the FEZ Administration as the legal entities, representative offices and branches of legal entities, individual entrepreneurs and natural persons (residents and nonresidents of the Republic of Tajikistan), which shall bring their organizational and legal status in compliance with the rules of this Provision.  

In case of not meeting the requirements of this Provision, the FEZ Administration shall address to the authorized state body responsible for ground to take an appropriate decision on seizure of the land for the state needs in accordance with land legislation of the Republic of Tajikistan.  

18. The state registration of an individual entrepreneur, legal entity, branch and (or) the representative office of the legal entity, resident and non-resident of the Republic of Tajikistan, who showed his/her willingness to obtain the status of the entity of FEZ "Ishkoshim" (hereinafter referred to as - the Applicant) shall be fulfilled in accordance with this Provision and the legislation of the Republic of Tajikistan.   

19. For the purpose of the state registration of an individual entrepreneur and legal entities, branches and representative offices of the legal entities - residents and nonresidents of theRepublicofTajikistan FEZ Administrationshall, as the entity ofFEZ, give the applicant a document confirming the legal address in theFEZ"Ishkoshim”.

20.For the purpose of obtaining the document confirming the legal address in the territory of FEZ "Ishkoshim", the applicant shall address to the FEZ Administration with the application, which shall include the information about the applicant, the business plan (s) and (or) investment project (s).

21. Business plan (s) and (or) investment project (s) shall meet the following requirements:

- The volume of investments to carry out productive activity – not less than the amount equivalent to 500 thousand U.S. dollars;

- Import, not less than 90 percent of industrial manufacturing equipment;

- The period of early use of imported manufacturing equipment shall not exceed 3 years;

- The entity ofFEZto implement production of goods within 3 years from the date of state registration obtained.

- The volume of investments for export and import activity – not less than the amount equivalent to 50 thousand U.S. dollars;

- The volume of investments for rendering services activity - not less than the amount equivalent to 10 thousand U.S. dollars;

Documents which do not meet the requirements of this subparagraph shall not be entertained.

22. FEZ Administration shall, within three working days from the date of the application received, notify the applicant of its decision.

23. The applicants shall, in accordance with the legislation of theRepublicofTajikistan, be responsible for the accuracy of the information provided.

24. The form and procedure for completing the application, providing the information, business plan and (or) investment project of the applicant shall be developed and approved by the authorized state body responsible for the management ofFEZ.

25. For the purpose of obtaining the certificate confirming the status ofFEZentity (hereinafter referred to as - Certificate), the applicant shall enter into an activity agreement with the FEZ Administration (hereinafter referred to as - the Agreement).  

The requirements for carrying the activity within the territory of FEZ "Ishkoshim”, for the land lease, for the procedure on using the privileges and special regimes, buildings, industrial and administrative constructions, required communications, financial and economic relations and other requirements provided for in this Provision.  

26. For the purpose of entering into the agreement, the applicant shall provide the FEZ Administration with the following documents:

- Application form;

- Documents confirming the state registration in theterritoryofFEZ"Ishkoshim";

- A sample of the signatures of the authorized bodies of the applicant.

27. FEZ Administration shall, within 3 working days, consider the documents submitted by the applicant, prepare and sign an agreement with the applicant.

28. The applicant shall be issued a certificate upon the agreement signed.  

29. Certificate shall be considered as a document confirming the registration of the applicant as the entity ofFEZ, as the activity license to use the benefits and special regimes granted in theterritoryofFEZ"Ishkoshim" under this Provision.  

30. Form and content of the agreement and the certificate shall be developed and approved by the authorized state body responsible for the management ofFEZ.

31. The cost of certificate shall be amounted for 5,000 dollars.

32. FEZ Administration shall keep the record book for registering the certificate in the form approved by the authorized state body responsible for the management ofFEZ.   

The basic information on the entity of theFEZshall be entered into the record book and the registration number shall be assigned to the certificate.

33. The relevant amendments shall be made into the record book in case of change of activity or legal form of the entity ofFEZ.  

34. Change of the activity or organizational and legal form of the entity ofFEZshall be based on the decision of the FEZ Administration upon the application of the entity ofFEZ. In this case, the entity ofFEZshall be issued a new certificate and the old certificate shall be null and void.  

35. Temporary suspension and resumption of the activity ofFEZentity as well as the cancellation (annulment) of the certificate of theFEZentity shall be fulfilled based on the following:

1) The temporary suspension of the activity of theFEZentity shall be fulfilled by the FEZ Administration for the period of up to three months in the case of the following circumstances:

- Non-compliance with the terms of the agreement made by and between FEZ Administration on the part ofFEZentity;

- Confirmation of the fact that theFEZentity, his/her authorized representative or employee caused damage for the service objects and equipment ofFEZ“Ishkoshim" and these actions keep continuing despite the notification of the FEZ Administration and (or) they did not refund of the damage caused;

- Not meeting the requirements of this Provision by theFEZentity or commission of actions violating the established order in theFEZ"Ishkoshim";

2) The resumption of the activity of the entity shall be permitted by the FEZ Administration when the terms are fulfilled and the causes of the suspension of the activity of theFEZentity are eliminated;

3) Cancellation (annulment) of the certificate shall be made by the FEZ Administration when the facts and the information on the following circumstances are verified:

- If it turns out that during the period specified in the agreement, the reasons that led to the temporary suspension of the activity ofFEZentity are not eliminated;

- If it is determined that the requirements of this Provision and normative-legal acts of the Republic of Tajikistan are violated on the part of FEZ entity.

36. Cancellation (annulment) of the certificate, FEZ Administration shall address to the authorized state body responsible for the state registration of cancellation (annulment) of the state registration ofFEZentity based on the corporate domicile inFEZ"Ishkoshim. 

5. The regulation of entry regime into the territory of FEZ "Ishkoshim" 

37. For the purpose of entering into theterritoryofFEZ"Ishkoshim", the representatives, employees, workers of the FEZ Administration andFEZentities and other persons shall have the following types of permits:  

- Permanent;

- Temporary;

- Service Cards.

Form and procedure for filling permits shall be developed and approved by the FEZ Administration.

38. Permits on a permanent basis shall be issued, by the FEZ Administration, to the representatives, employees andFEZentities and shall contain the following information:

- The name and a special seal of the FEZ Administration;

- Date of issue;

- Photo of the permit holder;

- First name, middle name and patronymic of the permit holder;

- Place of work;

- Terms of permit.

39. Temporary permits shall be issued, by the FEZ Administration, upon the entrance into theterritoryofFEZ"Ishkoshim" of the persons who visit theterritoryofFEZ"Ishkoshim" on the FEZ Administration and the entities ofFEZ.   

For the purpose of obtaining a permit on a permanent basis, the entities ofFEZshall formally address to the FEZ Administration not later than one day before the visit toFEZ"Ishkoshim" of the invitees.

Color of a temporary permit shall be different from other permits and shall be returned to the relevant services of FEZ Ishkoshim upon the exit from the zone.

Temporary permits shall be valid upon submission of Passport or ID Card.

40. Official cards shall be issued, by the FEZ Administration, to the employees of FEZ Administration as well as to persons hired by FEZ Administration and they shall contain the same information as the permanent permits do.

41. Permits shall be processed and issued to the vehicles, various equipment and their drivers based on the same procedure.

42. Permits shall be issued on a payment basis at the rates established by the authorized state body responsible for the management ofFEZ.

43. The entities ofFEZshall inform the FEZ Administration about dismissing their employees on the same day. In this case, permits on a permanent basis issued to the employees shall be returned to the FEZ Administration on a mandatory basis.   

6. Rights of FEZ Entities 

44.FEZentities shall have the following rights:

- Establish the joint organizations with the participation of foreign and domestic investors;

- Carry out economic activity on the basis of agreements, choose a partner on a free basis, the subject of the agreement, and determine the obligations as well as any other terms of business relationships;

- Carry out independently the foreign economic activity, barter (bargaining) and agency transactions as well as reinvestments within the territory of FEZ, if the nature of these transactions is in compliance with the legislation and does not threaten the economic security of the Republic of Tajikistan;

- Without any limitation to receive loans from foreign banks, companies and organizations, to attract foreign insurance companies for the purpose of concluding of al types of insurance transactions;

- Attract any investments into the free economic zone, which are not prohibited by the legislation;

- Use of land areas on the basis of the agreement on the urgent rental, of property, property rights and on the basis of assignment of rights for use based on the mutual agreement of the signatories to the lease or their legal successors as well as use of other property and non-property rights;

- Hire the foreign persons and citizens of theRepublicofTajikistanon a contractual basis;

- Independently form the manufacturing program;

- Carry out any other activity, which is not prohibited by the existing legislation of theRepublicofTajikistan.

45. TheFEZentity shall have the right to carry out entrepreneurship outside theFEZ"Ishkoshim" within the territory of theRepublicofTajikistanin compliance with the norms of the legislation of theRepublicofTajikistan. 

7. Ensuring the Rights and Interests of FEZ Entities 

46. The Government shall ensure the loyalty and compliance with the legitimate interests of allFEZentities operating within theterritoryofFEZ"Ishkoshim.

47.FEZ“Ishkoshim" shall, in accordance with the legislation of theRepublicofTajikistanand international rule of law, ensure the following:  

- Legal protection of investments;

- Protection of copyrights ofFEZentities;

- Equal treatment of foreign and domestic investments;

-Non-discrimination toward organizations having foreign investments.

48.FEZentities – shall mean the foreign investors making financial and material contributions to the economic area and other activities of theFEZ"Ishkoshim", which shall have the right to possess, use and dispose of the results of their investments, including reinvestments and commercial transactions within the territory of theRepublicofTajikistan.FEZentities – shall mean the foreign investors, which may take out profits or part thereof in the form of goods.

49. FEZ entities – the foreign investors operating in the FEZ Ishkoshim shall be guaranteed to be transferred abroad upon payment of prescribed mandatory costs, amounts in the foreign currency received by them in the form of profits as well as they shall be guaranteed, in connection with the sale of all participating interests in the authorized capital of organizations with foreign investments, disaffiliation with the participating interests in the authorized capital or the liquidation of the organization. TheFEZentities – means the foreign investors, which shall have the right to transfer, transmit, pledge, export and terminate their investments inFEZ.

50. Commercial disputes, including the disputes between the parties to organizations with the foreign investment located in theFEZ"Ishkoshim" shall be settled down in accordance with the legislation of theRepublicofTajikistan. 

8. Financial and Monetary Mechanism 

51. The operation of FEZ Ishkoshim" shall be based on self-financing. For the purpose of ensuring the operation ofFEZ"Ishkoshim" an independent budget of FEZ Ishkoshim" shall be formed.  

52. An independent budget of FEZ Ishkoshim" shall be in the form of institution and in the form of expenditure of all money resources of FEZ Ishkoshim" and shall be used to ensure the financial security for the implementation of goals and objectives of FEZ "Ishkoshim".

Draft independent budget of FEZ “Ishkoshim" shall be developed by the FEZ Administration and in accordance with the procedures determined by the authorized state financial body, which in cooperation with the authorized state body responsible for the management of FEZ and authorized state financial body shall be proposed to be included in the annual state budget during the development of the draft state budget.

53. The sources for forming the independent budget of FEZ Ishkoshim" are the following:

- Income from rental of land, buildings, constructions and equipment, which are under the jurisdiction of the FEZ Administration;

- The cost of the certificate;

- Payments for entry into theterritoryofFEZ"Ishkoshim", for vehicles and various equipment (except for motor transport and equipment of theFEZAdministration andFEZentities);

- Payments for entry permit into theterritoryofFEZ"Ishkoshim" (except for staff of the FEZ Administration of and the entities ofFEZ);

- Income from rendering various services, including rendering to entities ofFEZ;

- Other payments and earnings provided for in the legislation of theRepublicofTajikistanand this Provision in terms of finance and the state budget.

54. The list of services and the rates of charges for services rendered by the FEZ Administration shall be approved by the authorized state body responsible for the management ofFEZin cooperation with the authorized state financial body on the basis of financial reasoned proposals of the FEZ Administration.  

55. Rental fees and terms of lease of land as well as covered storage areas, manufacturing and administrative premises, which right of use belongs to the FEZ Administration shall be based on rental payment calculation procedure approved by the authorized state body responsible for the management of FEZ, but rental fees and terms of lease of rent shall not be less than the following rates depending on the types of activity of the FEZ entities:

- Monthly rent of covered storage areas for the purpose of carrying out the commercial activities as well as storage, packaging and grading of goods activity shall be amounted for $ 5 per each square meter of premises rented for up to three months. Lease payment for the term exceeding three months shall be subject to 10 percent discount;  

- Annual rent of administrative premises shall be amounted for $ 3 per square meter. Lease payment for the term exceeding one year shall be subject to 10 percent discount;

- Annual rent of premises for manufacturing activity shall be amounted for $ 3 per square meter. Lease payment for the term exceeding one year shall be subject to 10 percent discount;

- Annual rent of land shall be amounted for $ 1 per square meter.

Limiting levels of fixed rates may be adjusted according to the decision taken by authorized state body responsible for the management ofFEZon the basis of financial reasoned proposals of the FEZ Administration.

Rate equal to 25 percent of annual rent of land shall be established for the entities ofFEZspecified in Article 17 of this Provision. In case of renting out the land premises by the entities of FEZ, which are settled on them as well as buildings and constructions, which belong to them, the lease payment rate shall be established and charged by the FEZ Administration in the amount equal to 100 per cent or $ 1 per square meter of land per year as an equivalent.  

56. Costs for maintenance, repair and improvement of common land premises, of local and internal motorways, viewing points, landscaping, etc. shall be carried out by the FEZ Administration on its own account and charges collected from the entities ofFEZbased on the rates established by the FEZ Administration.

57.FEZ"Ishkoshim" shall provide free circulation of national and foreign currencies. The entities of FEZ shall have the right to open accounts with the banks, financial and non-bank institutions (its offices) and with microfinance institutions located in the FEZ "Ishkoshim" and outside its territories and shall have the right to have and market the national and foreign currencies in the FEZ" Ishkoshim" on a free basis and to make transfers in a manner provided for in the legislation of the Republic of Tajikistan.

58. The entities ofFEZmay, in foreign currency, pay the workers on hire through the currency funds being established and may carry out the reciprocal payments in foreign currency within theterritoryofFEZ"Ishkoshim".  

59. Banks, financial and non-banking institutions, microfinance and insurance companies may be established within theterritoryofFEZ“Ishkoshim” in accordance with the legislation of theRepublicofTajikistan. 

9. Financial and Economic Activity of FEZ Entities 

60. The entities ofFEZshall be responsible for the following:

- Maintain accounting records and reporting on financial and economic activity in an established procedure and provide the FEZ Administration with the information based on the list approved and in a manner specified by the authorized state body responsible for the management of FEZ.

Reports and declarations on the payment of social and income taxes by natural persons working on hire shall be submitted to the tax authority of Ishkoshim area;

- Ensure the payment, in a full and timely manner, of all mandatory charges, social tax of persons working on hire;  

- Allow the authorized persons of the FEZ Administration to carry out the examination of epidemiological and fire prevention and mutual payments activities in accordance with the agreement made by and between the FEZ Administration.

61.FEZentities shall be responsible for fulfillment of the decisions taken by FEZ Administration within its powers.FEZentity shall have the right to apply to the court in case of disagreement with the decisions taken by the FEZ Administration.  

62. The fiscal year, for the FEZentities, shall be the period from January 1st till December 31st of each year. 

10. Customs Regime in FEZ "Ishkoshim" 

63.FEZ"Ishkoshim" shall be the part of the customs territory of theRepublicofTajikistan.

The boundaries of theterritoryofFEZ"Ishkoshim" shall be the customs border of theRepublicofTajikistan.

Goods placed in theterritoryofFEZ"Ishkoshim" shall be considered as being outside the customs territory of theRepublicofTajikistanfor the purpose of applying the customs duties, taxes as well as prohibitions and restrictions having an economic character provided for in the normative and legal acts of theRepublicofTajikistan.

64. Foreign and domestic goods shall be placed without levying the customs duties and taxes as well as without the application of prohibitions and restrictions having an economic character, established in accordance with normative and legal acts of the Republic of Tajikistan, in terms of goods, within the territory of FEZ “Ishkoshim" based on the free customs regime of the free customs zone.  

65. Customs clearance and accounting of goods in theterritoryofFEZ"Ishkoshim" shall be carried out in a manner set by the authorized body responsible for customs affairs in cooperation with the authorized state body responsible for foreign trade activity.

66. The completion of the operation of the customs regime of free customs zone and the determination of country of origin for goods exported from theterritoryofFEZ"Ishkoshim" shall be carried out in accordance with the legislation of theRepublicofTajikistan. 

11. Tax Regime in FEZ 

67.FEZentities shall be partially exempt from the payment of certain taxes for the period of their activity inFEZ"Ishkoshim in accordance with the legislation of theRepublicofTajikistan.

68. The activity ofFEZentities within theterritoryofFEZ“Ishkoshim" shall be exempt from the payment of all taxes provided for in the Tax Code of theRepublicofTajikistanexcept for social and income tax of persons hired.  

The social and income tax of persons hired shall be charged and paid by theFEZentities in an independent manner in accordance with the Tax Code of theRepublicofTajikistan.

69. Income tax of foreign experts - non-residents of theRepublicofTajikistanshall be paid in a manner provided for in the Tax Code of theRepublicofTajikistan.

70.FEZentities shall be registered as taxpayers with the tax authority of Ishkoshim area.

71. Control over the payment of social and income tax of persons hired shall be made by the tax authority of Ishkoshim area in a full and timely manner.  

72. Income of foreign investors and wages of foreign workers received in foreign currency can be easily carried by them abroad and when export them abroad shall not be subject to taxation. 

12. Employment Relations in FEZ "Ishkoshim" 

73. Employment relations in terms of the issues of hiring and dismissal, conditions of labour and leisure, social securities and compensations to the FEZ entities shall be governed through labor legislation of the Republic of Tajikistan, the collective agreement (contract) and/or through individual employment agreements (contracts).

Terms and amount of payment as well as the other types of income of workers, including the payment in the foreign currency shall be established by theFEZentity in an individual manner and shall be paid on their own account.

Terms of collective and individual employment agreements may not make the situation of workers of these organizations worse in comparison with the terms provided for in the existing labour legislation of theRepublicofTajikistanas well as in conventions of the International Labour Organization.

74. In accordance with the legislation of theRepublicofTajikistanin force, including the legislation related toFEZin theRepublicofTajikistan:

- FEZ Administration shall have the right to issue a permit for the purpose of attracting the labour resources (work permit) from abroad to fill managerial and technical positions, when the number of employees – foreign citizens does not exceed 20 percent of the total number of workers ofFEZ;

- FEZ entities shall submit the application to FEZ Administration along with the information attached related to the expert, labour agreement made by and between FEZ entity and this expert  as well as submit other documents set by FEZ Administration for the purpose of attracting labour resources from abroad;

- FEZ Administration shall consider the application for attracting foreign expert within 10 days. The work permit shall be issued for a term not exceeding 5 years based on the labour agreement;

- Upon reception of the work permit, FEZ entities shall submit the application for the purpose of obtaining visa support and permission to stay of a foreign citizen; visa and permission to stay of a foreign citizen who is involved into work shall be issued, through FEZ Administration, by the relevant state body on the basis of work permit taking into account the terms of permission according to the simplified procedure;

- Foreign workers ofFEZentities, which obtained a visa and work permit, shall, in a mandatory manner, be registered in visa and registration office of the relevant state body.  

- Payment for services rendered related to issuance of a visa, work and residence permit for foreign experts of FEZ entities and for their family members shall be carried out on a fee basis according to the rates approved by the appropriate authorized state body responsible for management of FEZ in coordination with the other authorized state body within the established norms provided for in the legislation of the Republic of Tajikistan;

75.FEZentities shall, on a monthly basis, make payment of wages for all working personnel in accordance with employment contract. In case of delay of payment of wages caused by the employer, FEZ Administration shall have the right, within its power, to take measures, with regard toFEZentity to protect the rights of workers and employees, provided for in this Provision and the legislation of theRepublicofTajikistan.

Personnel ofFEZentities may, in accordance with employment contracts, receive wages either in national or foreign currency as well as shall have the right to receive the amount in foreign currency when having business trips to cover their expenses.

Wages of foreign employees received either in foreign or national currency may be, without delay, transported abroad upon payment of taxes.

76.FEZentities shall be responsible for the following:

- Submit the employment contract for each employeeFEZ“Ishkoshim" personnel when applying for a permanent visa;

- Ensure the receipt of a visa within 72 hours upon the arrival of the employee;

- Provide all employees and staff with uniforms and meet the safety requirements for their work;

- Immediately inform the FEZ Administration about the disappearance of any of its employees;

- Provide its employees with a place to stay.

- Ensure mandatory social and health insurance of its employees;

- Any damages caused to the health of workers, employees working under contracts, employment injury occurred through the fault of the company within its territory.

77. Strikes shall be prohibited within theterritoryofFEZ"Ishkoshim". 

13. Procedure on Entry in (Departure from) the territory of FEZ “Ishkoshim" 

78. The simplified procedure on entry and exit of foreign citizens shall be functioning, which  to be determined by the authorized state body responsible for the management of FEZ in coordination with the Ministry of Foreign Affairs of the Republic of Tajikistan and which shall include the following:

- 50-percent discount of consular charges;

- Reduction of term for review of documents related to issuance of entry and exit visas;

- Issuance of entry visas, in practice, to foreign citizens, who as a result come to work in theFEZ"Ishkoshim" upon their arrival in theRepublicofTajikistan;

- Other information and legal and consulting services to be rendered to FEZ “Ishkoshim" provided by the Ministry of Foreign Affairs of the Republic of Tajikistan in accordance with the changing development process of free economic zone.

79. FEZ entities shall, if the need be, apply to the FEZ Administration the set form to obtain a visa for the purpose of working in the FEZ "Ishkoshim" of the arriving personnel one month before their expected arrival.

FEZ Administration shall consider an application for obtaining a visa by the arriving personnel with an objective to work in theFEZ"Ishkoshim" and shall informFEZentity about the opportunity to obtain visa by the specified persons in the application on an individual basis.  

List of persons to be arrived with an objective to work in theFEZ"Ishkoshim" shall be certified by the authorized state body responsible for the management ofFEZand shall be sent for the consideration by the consular departments of the Ministry of Foreign Affairs in the places of personnel arrival in the territory of theRepublicofTajikistan.

FEZ Administration shall meet and follow the persons arrived to the territory of FEZ "Ishkoshim" together with a representative of FEZ entity and at his/her expense.

A similar procedure shall be carried out when departure of foreign personnel working inFEZ“Ishkoshim” from the territory.

80. FEZ Administration shall assist in obtaining visas for foreign citizens, its extension and revocation.  

FEZ Administration shall, in a monthly basis, inform the authorized state body responsible for the management ofFEZand the Ministry of Foreign Affairs of theRepublicofTajikistanabout the foreign citizens who arrived with an objective to work in theFEZ"Ishkoshim" through providing the list of foreign natural persons arrived inFEZ“Ishkoshim" in an established manner.

81. Entry of foreign citizens and stateless persons in the border area of theRepublicofTajikistanfor the purpose of business and private trips as well as for the purpose of carrying out the labour activity shall be fulfilled through permits issued by the Ministry of Internal Affairs of theRepublicofTajikistan. Procedure on entry and stay of foreign citizens within the territory of theRepublicofTajikistanshall be carried out in accordance with normative and legal acts of theRepublicofTajikistan. Registration, issues related to temporary residence permit, entry and stay of foreign citizens and stateless persons shall be carried out by the Ministry of Internal Affairs upon submission of the documents by the FEZ Administration.  

14. Term of Validity of FEZ "Ishkoshim" 

82. Term of validity ofFEZ"Ishkoshim" shall be 25 years.

Terms and conditions of the transitional phase when conducting the procedure of FEZ “Ishkoshim" shall be determined by the FEZ Administration, but shall not be more than 7 years from the date of adoption of Decree of Majlisi Namoyandagon Majlisi Oli of the Republic of Tajikistan related to approval of the Provision on FEZ "Ishkoshim”.

This period shall be used for infrastructural development, organization of the legal base, the real development of theterritoryofFEZ"Ishkoshim”.

Terms and conditions of the transitional phase before the termination of the procedure ofFEZ"Ishkoshim" shall be also determined by the FEZ Administration. Meanwhile, the conditions of the transitional phase shall occur not later than 3 years before the termination of theFEZ.

Along with the state language, Russian and English languages as the international ones shall be as working languages in theterritoryofFEZ"Ishkoshim" during its operation.  

83. For the purpose of extension in validity of FEZ"Ishkoshim", FEZ Administration shall submit, to the authorized state body responsible for the management ofFEZ, the feasibility study on practicability of extension in validity ofFEZ“Ishkoshim”, which shall include the following:

- Prospects and program on further development ofFEZ"Ishkoshim";

- Assess the effectiveness ofFEZ"Ishkoshim” operation. 

15. Procedure of FEZ Administration Activity 

84. Management functions within theterritoryofFEZ“Ishkoshim” shall be carried out by FEZ Administration headed by Administrative Manager. The procedure of FEZ Administration activity shall be determined by this Provision.

FEZ Administration shall be a body responsible for the management of FEZ "Ishkoshim”, which shall ensure the operation and development of FEZ" Ishkoshim" as well as coordinate the activity of the FEZ entities within the established rights and powers.

FEZ Administration shall be a legal entity and shall be established in the legal form as the state republican agency. FEZ Administration shall be the lower organization of the authorized state body responsible for the management ofFEZand shall operate in accordance with the legislation of theRepublicofTajikistan, this Provision and the Charter approved by the authorized state body responsible for the management ofFEZ.

FEZ Administration shall have a seal with the description of the State Emblem of theRepublicofTajikistanand with the title: "Free Economic Zone "Ishkoshim" written in the state and English languages and shall have bank accounts, its own symbols, other attributes and details.

85. FEZ Administration shall operate in cooperation with the republican and local authorities of theRepublicofTajikistan.

FEZ Administration shall operate based on the principles of close cooperation with administrations of other FEZ in the Republic of Tajikistan for the purpose of harmonization and taking into account the interests of other FEZ in the Republic of Tajikistan, shall promote the formation of international doing business standards and business ethics throughout the country.

86. Maintenance expenditures of FEZ Administration staff shall be implemented at the expense ofFEZ"Ishkoshim" budget according to the estimates for the next fiscal year approved by the authorized state body responsible for the management ofFEZand the authorized state financial body.

87. Rights and powers of the FEZ Administration of "Ishkoshim" shall be the following:

- Development and implementation of strategy and development programs of FEZ Ishkoshim", including the master plan of the zone;

- Adoption of documents related to management and coordination of activity inFEZ"Ishkoshim";

- Development of an individual budget for a zone, its adoption in the established manner and ensure its implementation;

- Development of the allocation plan of FEZ entities in the territorial boundary of FEZ "Ishkoshim" based on their proposals, including the financial costs of each entity of FEZ for its further submission to the authorized state body responsible for the management of FEZ;

- Making cost estimates related to the development of specific territorial boundary ofFEZ"Ishkoshim";

- Coordination of customs infrastructure allocation schemes with the state authorized customs service;

- Ensuring the integrity and effective operation ofFEZ"Ishkoshim";

- Ensuring the development of FEZ "Ishkoshim" through attraction of domestic and foreign investors, funds of domestic and foreign organizations in the form of privileged credits, loans and grants in coordination with the authorized state body responsible for the management of FEZ and the authorized state financial body;

- The establishment of the informational and analytical base related to the activity and economic development ofFEZ"Ishkoshim";

- Protection of the interests ofFEZentities;

- The establishment of the required conditions for attracting domestic and foreign investments and other resources;

- Control over the adherence of the legal treatment ofFEZ"Ishkoshim, development of amendments and changes to this Provision and their consideration in the established manner;

-Ensure the state control and supervision over rational use of natural and labor resources within the territory of FEZ "Ishkoshim, over the implementation of legal and normative acts related to the development of the territory of FEZ" Ishkoshim";

- Provision of land for rent to theFEZentities as well as other objects ofFEZ"Ishkoshim";

- The establishment of an informational center, business incubators, storage facilities, office buildings, manufacturing constructions and others required for the effective operation and development of FEZ "Ishkoshim";

- Coordination of activity of scientific, design, industrial, construction and other domestic and foreign companies attracted for the purpose of the establishment and ensuring the operation of FEZ "Ishkoshim";

- Review of business plans and investment projects of the applicants;

- Issuance of supporting documents to applicants related to their location and corporate domicile in theFEZ"Ishkoshim";

- Coordination of relations of FEZ Ishkoshim "with the international market;

- Carry out training, retraining and professional development of the personnel forFEZ"Ishkoshim”, participation in the implementation of state policy on professional development, employment, youth and migration in the region;

- Organization of conferences, meetings, seminars, etc;

- The signing of contracts withFEZentities;

- Organization and maintenance of registration books of certificates;

- Issuance of certificates to theFEZentities;

- Improvement of FEZ "Ishkoshim” economic management models and implementation of economic management by taking into account the economic efficiency of use of land area, state and private property in the territory of FEZ" Ishkoshim";

- Ensure the application of funds to the projects that have a region-wide significance;

- Rendering services for obtaining and processing of entry and exit visas, which carried out in coordination with the Ministry of Foreign Affairs of theRepublicofTajikistan;

- The issuance of permits for the purpose of visiting theterritoryofFEZ"Ishkoshim";

- The establishment and control over the activity of subdivisions of the paramilitary security services rendered to the objects ofFEZ"Ishkoshim. The structure and number of the subdivisions above mentioned shall be determined by FEZ Administration in cooperation with the relevant ministries of theRepublicofTajikistan;

- Submission of quarterly reports on the activity of theFEZ"Ishkoshim" to the authorized state body responsible for the management ofFEZ;

- Implementation of other powers provided for in the legislation of theRepublicofTajikistanon "Free Economic Zones in theRepublicofTajikistan", this Provision and other normative and legal acts of theRepublicofTajikistan.

88. Decisions taken by FEZ Administration within its competence shall be subject to compulsory implementation byFEZentities.

89. Audit of FEZ Administration activity shall be carried out by the authorized state body responsible for the management ofFEZ.

90. Head of FEZ Administration and his/her deputies shall be assigned and dismissed by the Government of theRepublicofTajikistanupon initiative of the authorized state body responsible for the management ofFEZ.

The size of wages of the management of the FEZ Administration shall be established by the Government of theRepublicofTajikistan.

91. The Head of the FEZ Administration is a person who shall have a higher legal or economic education and work experience in managerial positions or public service not less than 5 years.

92. The Head ofFEZAdministration shall be responsible for the following:

- Ensure the rights and responsibilities of FEZ Administration;

- RepresentFEZ“Ishkoshim" in all domestic, foreign and international organizations, enterprises, banks and institutions;

- Personally be responsible for the fulfillment of his/her functions and objectives;

- Develop the personnel, assign and dismiss the employees of FEZ Administration;

93. Head of FEZ Administration shall, along with other functions, coordinate the agreed activity of FEZ Administration with local executive government authorities related to the formation and development ofFEZ"Ishkoshim”. 

16. Procedure on liquidation of FEZ "Ishkoshim" 

94.FEZ"Ishkoshim" shall be liquidated based on the Decree of the Government of theRepublicofTajikistanin cases provided for in the legislation of theRepublicofTajikistanrelated toFEZ.

95. In case of liquidation of Free Economic Zone,FEZentities shall forfeit their rights and obligations provided for in the legislation onFEZ.

Liquidation ofFEZshall not lead to any legal consequences related to the activity or liquidation of legal entities and branches of foreign legal entities; they may operate in the territory of the formerFEZor may be liquidated in accordance with the legislation of theRepublicofTajikistan.

Authorized state body responsible for the management ofFEZshall, in a manner provided for in the Law of theRepublicofTajikistanon "Free Economic Zones in theRepublicofTajikistan" submit the proposal to the Government of theRepublicofTajikistanrelated to the liquidation ofFEZ"Ishkoshim”.

The Government of theRepublicofTajikistanshall set up a commission for conducting the full economic analysis on reasonability ofFEZ"Ishkoshim” liquidation.

Based on the full analysis carried out as well as by taking into account the proposals of the authorized state body responsible for the management ofFEZand local executive body of state authority, the Commission shall introduce the Government of Tajikistan a proposal on the liquidation and terms of liquidation ofFEZ"Ishkoshim”. 

17. FEZ Administration Details 

96.FEZ"Ishkoshim" shall be located at the following address:

Ishkoshim area,  Gorno-Badakhshan Autonomous Oblast,RepublicofTajikistan.