FG Tightens Special Economic Zones Rules, Protects Incentives, Backs Digital Free Zones
By Aboki Forex —
The Federal Government is tightening the regulatory framework for Nigeria’s Special Economic Zones (SEZs). It says legitimate incentives will be protected while loopholes allowing abuse of the Free Zones scheme are closed.
Minister of Industry, Trade and Investment, Dr Jumoke Oduwole, gave the assurance as the Special Economic Zones Legislative and Regulatory Reform Committee began a drafting retreat. The retreat is to turn ongoing consultations into revised legislative and regulatory instruments.
Who is drafting the reform
The retreat brought together officials from the Ministry of Justice, Ministry of Industry, Trade and Investment, Nigeria Export Processing Zones Authority (NEPZA), Oil and Gas Free Zones Authority (OGFZA), Nigeria Customs Service and Nigeria Revenue Service (NRS).
Oduwole said the reform is not aimed at dismantling the Free Zones regime or withdrawing incentives that have historically attracted investors. She listed duty-free importation of capital goods, tax exemption on qualifying export profits, 100 per cent foreign ownership and unrestricted repatriation as incentives that would remain central to the framework.
She said: “A Free Zone cannot become an alternative route into the Nigerian domestic market on terms unavailable to manufacturers operating in the Customs Territory. But this is not an argument against Free Zones. It is an argument for protecting them. Legitimate investors who have committed capital to Nigeria deserve certainty. The rules must be clear. Institutional responsibilities must be clear. Customs and tax treatment must be predictable. And lawful incentives must remain defensible.”
Customs enforcement and abuse concerns
She said the reform followed renewed scrutiny of the integrity of the Free Zones scheme after recent Nigeria Customs Service enforcement actions. The actions involved allegations that goods entering under Free Zone concessions were later diverted into the domestic market.
According to her, the government wants to address such weaknesses without undermining investors and operators who have complied with existing rules.
She said: “The choice before Nigeria is not between preserving the Free Zones scheme and dismantling it. It is whether we can preserve what works, correct what does not and build a framework capable of serving the economy we are becoming.”
Oduwole said the participation of Customs and the NRS as core members of the drafting committee was deliberate. She said both institutions will play key roles in implementing customs and tax provisions under the new framework.
She noted that a key principle emerging from stakeholder discussions is the call for “one authority, one visit, one record” to reduce regulatory friction for businesses in the zones. She described the principle as a useful test for the final implementation framework.
Digital Free Zones and 180-day launch roadmap
Oduwole said the reform marks a significant expansion of the Free Zones framework to accommodate digital businesses. For the first time, the draft regulations expressly recognise Digital Free Zones and Digital Free Zone Enterprises. Proposed licence categories include Innovator and Sandbox licences for businesses that may not require a conventional physical presence.
She said the development followed President Bola Tinubu’s directive to move the Digital Free Zones initiative into implementation, with a roadmap for full launch within 180 days.
Oduwole said Nigeria’s export ambitions must extend beyond physical goods. She said: “Nigeria’s future exports will not only leave our ports in containers. Nigerian companies increasingly export technology, financial and professional services, creative products, intellectual property and other digitally delivered services. A modern Special Economic Zones regime must be able to attract those businesses as deliberately as it has historically sought to attract manufacturers.”
She said the reform is aligned with the Renewed Hope Agenda and the Federal Government’s efforts to expand Nigeria’s productive base, increase non-oil exports and create jobs.
NEPZA Chairman Hadi Mutallab said the reform would strengthen the integrity of the scheme while ensuring legitimate operators were protected during the transition. Executive Secretary of the Nigeria Economic Zones Association, Toyin Elegbede, welcomed the consultative process. He said operators wanted reforms that addressed genuine regulatory gaps without creating uncertainty for existing investments.
For operators, the key issue is implementation. The government says lawful incentives will remain, but Customs and tax treatment must become predictable. That balance will shape whether SEZs continue to attract capital and whether non-oil exports can grow.