Work from home inside a customs-bonded enclave raises unique legal questions: the employee, the laptop and the data all sit outside the zone, while the unit's duty-free status depends on its operations being within it. Rule 43A of the SEZ Rules, 2006 provides the framework.

How the rule developed

Rule 43A was inserted in July 2022 to permit specified employees of SEZ units to work from home or from any place outside the SEZ. Eligible categories were employees of IT/ITeS units, employees who are temporarily incapacitated, employees who are travelling and employees working offsite. The original framework allowed permission for a maximum period of one year at a time and covered up to 50% of employees, and required proposals to the Development Commissioner at least fifteen days in advance.

In November 2023 the rule was amended to allow a hybrid model under which a unit may permit specified employees to work from any place outside the SEZ as per its requirements, for a limited period. By notification G.S.R. 786(E) dated 26 December 2024, the Ministry of Commerce extended the validity of this permission in sub-rule (3) from 31 December 2024 to 31 December 2027.

Key compliance points

• Work must be limited to services approved for the unit and relate to a project of the unit.
• The unit must keep attendance and other records and report changes to the Development Commissioner as required.
• Removal of laptops and other equipment is permitted subject to the Specified Officer's approval and conditions on return.
• The unit remains responsible for data security, confidentiality and client contracts.

Practical advice

• Adopt a written work-from-home policy aligned with the rule and employment contracts.
• Maintain a register of assets taken outside the zone.
• Review client agreements for restrictions on offshore access to data.
• Check the current text of the rule and any Development Commissioner instructions before relying on it, as amendments are frequent.

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This article is for general information only and is not legal advice. Law and procedure change; please verify the current position for your specific case. Last reviewed: November 2026.