The Office of Administrator, International Financial Services Centres Authority (IFSCA), has issued the SEZ Compliance FAQs Booklet (Version 2.0), August 2026, providing consolidated guidance to entities operating or proposing to operate in the Gujarat International Finance Tec-City International Financial Services Centre (GIFT-IFSC). The booklet explains the compliance framework applicable to IFSC units under the Special Economic Zones Act, 2005 and the SEZ Rules, 2006, covering the regulatory life cycle of an SEZ unit from obtaining the Letter of Approval (LOA) to commencement, periodic reporting, renewal and exit. The booklet reiterates that an IFSC can be established only within an SEZ and, accordingly, every IFSCA-approved/licensed/registered/authorised IFSC unit is also required to comply with applicable SEZ provisions.
Letter of Approval and digital processing: The updated guidance clarifies that the Letter of Approval (LOA) is issued under Rule 19 of the SEZ Rules, 2006 for the specific authorised operations to be undertaken by a unit. For activities enabled through IFSCA’s SWIT portal, the Common Application Form submitted through SWIT automatically flows to the SEZ Online portal for processing of the SEZ LOA. Applications complete in all respects are placed before the Unit Approval Committee (UAC), and after approval and finalisation of the minutes, the LOA is issued through the SEZ Online portal.
Instruction No. 123 dated 23.02.2026 — e-BLUT replaces physical process: A major ease-of-doing-business measure highlighted in the booklet relates to the Bond-cum-Legal Undertaking (BLUT). Under Instruction No. 123 dated 23 February 2026 of the Ministry of Commerce, BLUT may be executed electronically, including through e-stamp or other digital mechanisms, and may also be signed using a Digital Signature. The earlier requirement of executing the BLUT physically on non-judicial stamp paper and having it notarised has been dispensed with.
Public Notice No. 06/2026-27 dated 12.08.2026 — online approval of BLUT: In terms of Public Notice No. 06/2026-27 dated 12 August 2026, issued by the Office of Administrator (IFSCA) pursuant to Instruction No. 123, units are required to submit the executed BLUT through the ‘New LUT’ request on the SEZ Online portal. The request is approved online by the Specified Officer and Administrator (IFSCA), following which the bond amount and LUT validity dates are automatically reflected on the portal. A unit seeking enhancement or top-up of the bond amount is required to submit a fresh BLUT through an ‘Update LUT’ request.
Instruction No. 122 dated 05.01.2026/Public Notice No. 03/2026-27 dated 13.07.2026 — reduction in duplicate reporting: The booklet also incorporates the revised mechanism under Instruction No. 122 dated 5 January 2026, relating to reorganisation matters such as change of name, change in shareholding pattern, business transfer arrangements, court-approved mergers or demergers, change in constitution and change of directors. Public Notice No. 03/2026-27 dated 13 July 2026 gives effect to this framework for IFSC units. Such organisational changes are no longer required to be separately intimated through the SEZ Online portal merely for submission to the UAC. Instead, the unit may comply with the relevant IFSCA Regulations/Framework, and the Office of Administrator (IFSCA) will obtain the information from the concerned IFSCA Division and place it before the UAC, thereby reducing dual reporting. Instruction No. 109 is stated to be no longer applicable to IFSC units for these matters.
Lease deed and commencement of operations: The FAQs reiterate that, under Rule 18(2) of the SEZ Rules, a registered lease deed is required to be furnished to the Administrator (IFSCA) within six months from issuance of the LOA. Failure to do so may result in the UAC considering withdrawal of the LOA after giving the unit an opportunity of being heard. The lease period is required to be at least five years. The booklet further clarifies that commencement-related intimations are to be filed through the ‘Free Form-Unit-Intimation of DCP’ request on the SEZ Online portal, and physical or email submissions are not entertained for such processing.
Monthly and annual reporting through SEZ Online portal: The booklet consolidates the reporting obligations relating to the Monthly Performance Report (MPR), Service Exports Reporting Form (SERF) and Annual Performance Report (APR). All IFSCA-regulated IFSC units having an LOA are required to submit MPR every month through the SEZ Online portal, while units whose commencement has been taken on record are required to submit SERF every month. The applicable MPR and SERF timelines are referred to Public Notice No. 03/2024-25 dated 23 December 2024. APR is required to be filed in Form-I for every financial year after commencement, with the booklet specifying an effective deadline of 31 December of the subsequent financial year.
Public Notice No. 02/2026-27 dated 16.06.2026 — SOFTEX clarification: The updated FAQs record that IFSC units falling within the definition of financial institutions under the IFSCA Act, 2019 and providing export of software to persons resident outside India are not required to file the SOFTEX Declaration Form. The clarification is referred to in Public Notice No. 02/2026-27 dated 16 June 2026.
LOA extension and renewal — Public Notice No. 01/2026-27 dated 18.05.2026: The guidance separately addresses extension and renewal of LOAs. Public Notice No. 01/2026-27 dated 18 May 2026 sets out the process for seeking extension beyond two years from the expiry of the original LOA, including submission through the SEZ Online portal with supporting documents and details of progress towards commencement of business. Following commencement, the LOA remains valid for five years from the date of commencement and is thereafter required to be renewed every five years. Under Rule 19(6A), units are required to apply for renewal before two months from the date of expiry; delayed applications may require justification and may attract monetary penalties.
Public Notice No. 05/2026-27 dated 12.08.2026 — storage of documents outside GIFT-SEZ: The booklet also clarifies that physical documents, including KYC-related documents, may be stored or maintained with an external archival/storage vendor or at premises outside GIFT-SEZ, subject to the requirement that documents prescribed under Rule 22(2) of the SEZ Rules continue to be maintained at the unit’s premises in physical or digital form. This position is reflected in Public Notice No. 05/2026-27 dated 12 August 2026.
SEZ employee ID card requirements: The FAQs reiterate, with reference to Public Notice No. 03/2025-26 dated 21 August 2025, that IFSC units are required to obtain SEZ ID cards for their direct as well as indirect employees from the Office of the Development Commissioner, GIFT-SEZ. The booklet states that cards are issued with a validity of three years for direct employees and six months for indirect employees and are required to be revalidated before expiry.
Public Notice No. 10/2025-26 dated 27.03.2026 — compliance and penal provisions: The updated booklet also draws attention to penal consequences for violations of LOA/BLUT conditions and the SEZ Rules. Illustrative instances include delayed LOA extension or renewal, late intimation of commencement, delayed submission of lease deeds or APRs, continuation of authorised operations after expiry of LOA and shifting of premises without prior approval. The booklet states that the minimum penalty under Section 11(2) of the Foreign Trade (Development and Regulation) Act is ₹10,000, while a higher penalty may apply depending on the seriousness of the contravention. The relevant guidance is referred to in Public Notice No. 10/2025-26 dated 27 March 2026.
Through the revised FAQ booklet, the Office of Administrator (IFSCA) has brought together key SEZ procedures, portal-based filing requirements, recent Ministry Instructions and Public Notices in a single reference document for GIFT-IFSC entities. The emphasis on electronic processing of BLUT, reduced duplicate reporting for organisational changes, online handling of LOA-related compliances and consolidated guidance on reporting and renewal is expected to provide greater procedural clarity and support ease of doing business for entities operating in the IFSC.
The booklet is intended for general guidance and reference purposes and does not constitute legal advice. It also provides that legal discrepancies, factual errors or suggestions concerning its contents may be communicated to the Office of Administrator (IFSCA).
The FAQ booklet can be accessed at: https://a2ztaxcorp.net/wp-content/uploads/2026/08/SEZ-Compliance-FAQ-Booklet.pdf
