Zones for Employment and Economic Development (ZEDE)

The special Zones for Employment and Economic Development regime was created in 2013 through a constitutional amendment to articles 294, 303, and 329 of the Constitution of the Republic of Honduras. The constitutional amendment was followed by the enactment of the ZEDE Organic Law. The ZEDEs are territorial and political subdivisions of the Republic of Honduras that enjoy broad levels of political, administrative, legal, and economic autonomy. The ZEDEs are exempt from most of the national legislation, and are subject only to the Constitution, the International Treaties ratified by Honduras, the ZEDE Organic Law, legislation concerning territorial waters and national symbols, and the criminal legislation of Honduras; from these foundations, ZEDEs are free to adopt their own forms of government, policies, and legal norms.

The ZEDEs are authorized to adopt their own legal norms, including commercial, financial, labor, civil, administrative, and procedural legislation; they can design and adopt an independent tax regime, a local public administration, commercial and property registries, as well as their own security, investigation and criminal prosecution bodies. The ZEDEs and companies operating within are not subject to any import or export taxes, tariffs, duties, charges or surcharges; ZEDEs have the authority to authorize international ports within their jurisdiction, adopt their own monetary policy. ZEDEs also enjoy a special judiciary, where national and foreign persons may act as judges, and which may operate under a common law legal system, or any other legal system that provides, at least, as much protection for human rights as afforded by the Constitution of Honduras.

There are currently three authorized ZEDEs in Honduras: a) Prospera ZEDE, promoted by Honduras Prospera, Inc.; and, b) Ciudad Morazán, promoted by Centroamerican Capital & Consulting; and c) ZEDE Orquidea, promoted by an agroindustrial exporting business group in the Choluteca Department. Economic researchers from Universidad Francisco Marroquín in Guatemala have calculated the economic potential of Próspera ZEDE, concluding that Honduras could raise its current Per Capita Income from US$ 2,500.00 to US$ 20,000.00 in 40 years, if at least 11% of the population goes on to work and live under Prospera’s jurisdiction. Within the Próspera, the economists estimate that GDP per capita could exceed US$ 40,000.00 in the same period of time.

The ZEDEs are supervised and authorized by the Committee for the Adoption of Best Practices (CAMP). The ZEDE can be developed in private lands with low population density in the Departments of the Bay Islands, Cortés, Atlántida, Colón, Gracias a Dios, Valle, and Choluteca.

The official source of Próspera ZEDE norms: https://pzgps.hn/

The official source of Ciudad Morazán norms : https://www.morazan.city/laws/

The official source of ZEDE Orquídea norms: https://zedeorquidea.com/

Legal Foundations of the ZEDE regime

Background Special Development Regions (RED)

Customs

Jorge Constantino Colindres

Abogado, consultor empresarial y analista de políticas públicas. Especialista en gobierno corporativo, derecho comercial, planeación fiscal y protección patrimonial, con experiencia impulsando procesos exitosos de reforma tributaria y fiscal. Miembro de la Junta Directiva de la Fundación para la Libertad Económica.

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