CPEC: SHC orders Sindh govt to file response to complaint against SEZMC

Karachi: Pakistani Sindh High Court (SHC) has directed the Sindh provincial government to file a reply in response to a complaint filed by two whistleblowers questioning creation of Special Economic Zones Management Company (SEZMC) to establish and develop the China-Pakistan Economic Corridor (CPEC) Special Economic Zones (SEZs) as provided by federal statute, SEZs Act 2012.

Plaintiffs Faizan Bashir and Muhammad Faraz Shaukat claiming themselves to be whistleblowers under Whistle Blower Protection and Vigilance Commission Ordinance 2019, submitted that SEZs Act provided for the establishment of provincial Special Economic Zone Authority (SEZA) which was constituted by the Sindh government in 2013.

The plaintiffs have impleaded Sindh Chief Secretary, Sindh Investment and Planning and Development Departments, SEZMC and its Chief Operating Officer, Planning Commission of Pakistan, Governor State Bank, Federal Board of Revenue, Security and Exchange Commission of Pakistan and CPEC Authority as the defendant in the case.

The plaintiff contended that section 10 provided for the establishment of only SEZ Authority and not the company.

They stated that Sindh government on February 13, 2013 issued a notification for constituting SEZA with Chief Minister Sindh its Chairman and Chairman Sindh Board of Investment, its Vice Chairman and Sindh Finance minister, secretaries of finance, industry and commerce, land utilization, energy, works and services, livestock and fisheries, Director General Sindh Board of Investment, President Karachi Chamber of Commerce and Industry as it members. The chief minister was also given powers to nominate two members.

The plaintiffs pointed out that SEZA was reconstituted by Sindh government on September 2, 2020, replacing finance minister with chief secretary with the Chief Executive Officer (CEO) to be appointed from among the members who were also to act as SEZ Authority’s secretary and to more members to be notified by the chief minister and two by the Board of Approval headed by the prime minister.

The plaintiffs submitted that in complete violation of provisions of SEZ Act 2013, the Sindh government on March 29, 2021, formed SEZMC under section 42 of Companies Act 2017 and appointed a private person its CEO without routing his appointment through Federal Public Service Commission.

The plaintiffs contended that legally two bodies could not exist and be responsible for the same function defeating the core purpose of SEZ Act 2012.

“On what basis is the SEZMC initiating projects by exercising powers of section 17 of SEZ Act 2012 when SEZ Authority Sindh is in place and operating,” the plaintiffs questioned.

The plaintiffs pointed out that recently Sindh government SEZMC in “complete violation” of provisions of SEZ Act 2012, invited proposals for design, finance, construction and operation and maintenance of Dhabeji Industrial Zone (DIZ) designated to be declared an SEZ.

The plaintiffs prayed the court to declare very formation SEZMC as illegal and against the provisions of SEZ Act 2012 and the Constitution of the country and stop it from awarding contract and acquiring land.

During hearing by Justice Hassan Azhar Rizvi, Advocate General Sindh questioned plaint’s maintainability.

The court, directing the Sindh government to file its reply, deferred further hearing for November 30 and ordered to maintain stay granted earlier.