Work from Home: Customs Duties and the SEZ Space

“I am working from home”, has become a popular statement in Jamaica certainly since March 2020. This follows the Government’s request of employers to consider implementing work-from-home measures to encourage and facilitate employees who could effectively perform their job functions at home to help slow the spread of COVID-19 in Jamaica. Interestingly, this statement is now being used by Jamaican business process outsourcing (“BPO”) and global services employees who are employed to businesses approved to operate in a special economic zone (“SEZ”) space as either a developer or an occupant. Having implemented work-from-home measures, it is important for SEZ businesses to pay keen attention to the customs duty implications of such measures and the geographic spaces within which they operate.

SEZs are geographical areas designated under The Special Economic Zones Act (the “SEZ Act”) with special economic regulations that differ from the general trade, tax and investment rules of Jamaica and which have certain fiscal/tax incentives. Therefore, the parameters of an SEZ would be limited to its defined geographic area as contained in the order that established the SEZ.


Goods (and certain services) imported into SEZs by developers or occupants are exempt from the payment of customs duties under the Customs Act. It is important to note that this exemption only extends to goods and services which have been imported into an SEZ for use in an SEZ and does not appear to extend to any goods and services imported for use outside that specific geographical area. Therefore, in order for the developer or occupant to benefit from the customs duties relief in respect of imported goods and services; such goods and services must be imported into the SEZ.

As a rule of thumb and as an ongoing obligation of SEZ businesses, even while work-from-home measures are active, business operators should ensure that goods imported into Jamaica for use in their business operations go directly to the brick and mortar operations in the respective SEZs.
If a developer or an occupant imports goods into an area that does not fall within the geographical area of its SEZ, Jamaica Customs Agency (“Customs”) and the Tax Authorities will not be obliged to treat such importation of goods by the occupant or developer as being imported into an SEZ and, on that basis, be free of customs duty. Even if the goods are invoiced to the SEZ entity’s location in an SEZ, if the goods, for example, themselves are not intended to physically enter into the SEZ (but intended to go to another location), it is unlikely that the developer or the occupant would benefit from the available tax relief under the SEZ Act in respect of the imported goods. The developer or the occupant could arguably face a claim from Customs for payment of such duties, penalties and possibly forfeiture under the Customs Act, even if the goods were initially released from Customs without payment of the duty because Customs were unaware that the goods were not intended for use in the SEZ.
Therefore, how could it be possible for approved SEZ businesses to transfer equipment out of a zone into the homes of employees and not run afoul of the law? The answer may be found in the Customs Act.

Temporary Transfers

One may deduce from section 35 of The Customs Act that the provision permits the Commissioner of Customs and Excise (the “Commissioner”) to authorize SEZ businesses to ‘import’ certain goods into the homes of employees from SEZs without paying customs duties on such goods. The catch, though, is that the use of such goods outside of SEZs must be for temporary use only.

In order to protect the public purse, SEZ businesses would be required under the Customs Act to pay over to Customs the amount of the duty on such goods as a deposit or give security therefor as requested by the Commissioner. Once satisfied, the Commissioner will permit the transfer of the goods to be used in the employees’ homes for no longer than three or six months. Consequently, on or before the date on which the Commissioner’s permission expires, the goods should be exported out of the homes of the employees into the SEZs from whence they came.

Failure to do so would likely result in forfeiture of the deposit paid to the Commissioner or the Commissioner electing to draw down on the security she holds in respect of the goods.

Government Waivers in Place

On August 31, 2020, in a letter to the Global Services Association of Jamaica (formerly the Business Process Outsourcing Industry Association, BPIAJ) (“GSAJ”) the Ministry of Finance and Public Service informed the GSAJ that the Minister of Finance has approved an extension of the “Work At Home facility” until December 31, 2020. The Minister also granted his approval for an extension of the waiver of a bond requirement in respect of those goods for the same period. This news came before the Ministry of Health and Wellness announced that the government’s COVID-19 approach had shifted from preventing and containing the spread of COVID-19 to now managing how we live with COVID-19.

There is no doubt that these approvals will help to lessen the possibility of a mass COVID-19 break-out at a call centre’s brick and mortar base as the number of positive COVID-19 cases in Jamaica continues to escalate. However, with the shift in the GOJ’s COVID-19 policy, and the reminder that COVID-19 will be with us up to 2021(and possibly beyond), many are waiting to see if further extensions will be in order for the BPO/global services sector.

As appealing as the approvals from the Ministry of Finance are, and as call centres continue to benefit from these special arrangements, it is important for SEZ businesses to also understand the ongoing obligations created by the SEZ Act and the Customs Act. Though not expressed in connection to work-from-home arrangements, such obligations arise by implication. When in doubt, it is imperative to seek advice from experienced counsel.

Jezeel Martin is an Associate at Myers, Fletcher & Gordon, and is a member of the firm’s Commercial Department. He may be contacted at or This article is for general information purposes only and does not constitute legal advice.

This article is for general information purposes only and does not constitute legal advice.

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