Theoretical And Legal Characteristics Of The Concept And Purpose Of Free Economic Zones

Abstract

The article analyzes the legislative and scientific approaches to the content of the concept of free (special) economic zones (FEZ).

The free economic zone is a part of the territory of a country where is special legal regime of economic activity operates in accordance with special legislation. Preferential customs, currency-financial, tax and other conditions of economic activity of national and foreign legal entities and individuals are introduced on the territory of FEZ.

The special legal regime of economic activity in the FEZ is established by the law for a specific period of regulation economic zone activity, and applies attract investment and achieve economic, social and other objectives,and is differs from the general regime.

In general, with the growth of production in the FEZ, GDP grows, new jobs are created and employment increases, resulting in an increase in household incomes and tax revenues. Collectively, the pace of economic development of a particular country is accelerating.

The purpose of the FEZ is: to intensify investment activities and attract foreign technologies, foreign exchange resources and organization of production using modern scientific and technological progress, development of export potential, creation of new jobs, and development of infrastructure to accelerate socio-economic development of a region or territory.

The international community pays special attention to the functioning of free economic zones. The EU has developed gray and black lists of offshore companies based on their compliance with financial standards. No specific sanctions have been imposed on countries and their residents or specific EU decisions, but being blacklisted by the SEZ in its poses reputational risks.

Individual EU Member States and other countries may set their own policies for SEZs and their actors in order to develop their economies.