WORLD TRADE
ORGANIZATIONG/SCM/Q3/COL/26
31 October 2003
(03-5807)
Committee on Subsidies and
Countervailing MeasuresOriginal:  Spanish
SUBSIDIES
Requests Pursuant to Article 27.4 of the Agreement
on Subsidies and Countervailing Measures
Questions Posed by Ecuador
The following communication, dated 29 October 2003, has been received from the delegation
of Ecuador.
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In accordance with new instructions received from my Government and pursuant to the
provisions of document G/SCM/39 on procedures, please find attached additional questions relating tothe continued extension of the transition period for Colombia's SIEX and Free Zone (ZF) subsidy
programmes.
DRAFT DECISION ON EXTENDING THE TRANSITION PERIOD FOR COLOMBIA'S
SUBSIDY PROGRAMMES
Questions relating to Colombia's compliance with its obligations under the Decisions of the
Committee on Subsidies and Countervailing Measures dated 13 December 2002, documents
G/SCM/93 and G/SCM/94.
A. 
SPECIAL IMPORT -EXPORT SYSTEM FOR CAPITAL GOODS AND SPARE PARTS (SIEX)
1. An examination of the legislation on the subsidy programmes notified by Colombia to the
WTO (document G/SCM/Q3/COL/17) reveals that there are several "Vallejo Plan Special Import-
Export Systems".  Specifically, from Articles 35, 37 and 43 and Chapter II, Articles 57 et seq. of
Resolution 1860, it can be ascertained that the SIEX comprises, on the one hand, raw material and
input programmes, and on the other, capital goods and spare parts programmes.
In view of the foregoing, could Colombia explain whether the phasing out of SIEX - which is
to be carried out in accordance with WTO Decision G/SCM/94 and is internally regulated by
Resolution 011 - also covers, in addition to capital goods and spare parts, "programmes" or
"operations" concerning raw materials and inputs.
2. Resolution 1860, Section II, Articles 71, 72 et seq., refers to the existence of a "Vallejo Plan
Programme for In-Bond Processing Operations".
Could Colombia explain whether the phasing out of SIEX - which is to be carried out in
accordance with WTO Decision G/SCM/94 and is internally regulated by Resolution 011 - also
covers, in addition to capital goods and spare parts, in-bond processing programmes or operations?G/SCM/Q3/COL/26
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3. Resolution 1860, Article 30 et seq., provides for an SIEX for "authorized programmes in the
oil and petroleum by-products sector".
Could Colombia explain whether the phasing out of SIEX - which is to be carried out in
accordance with WTO Decision G/SCM/94 and is regulated internally by Resolution 011 - alsocovers, in addition to capital goods and spare parts, authorized programmes in the oil and petroleum
by-products sector?
4. In the event that Colombia considers that the SIEX or Vallejo Plan for raw material and input
programmes, in-bond processing operations and authorized programmes in the oil and petroleum
by-products sector are not covered by WTO Deci sion G/SCM/94 and consequently by Ministry of
Trade Resolution 011 of January 2003, could Colombia explain the reasons why it does not considerthose programmes or operations to involve prohibit ed export subsidies, extension of which should
have been requested and authorized by the WTO in 2002?
5. Could Colombia state whether Resolution 011 also covers "raw materials or intermediate
goods used in the production or assembly of capital goods or spare parts that are to be used in the
production of export goods", referred to in Article 77 of Resolution 1860 and Article 25 of Resolution1964?
B. 
FREE -ZONE (ZF) REGIME
1. Could Colombia explain essentially why, in its request and initial notification to the WTO for
approval of the extension of the "industrial free-zone regime for goods and services" (documents
G/SCM/N/74/COL of 15 January 2002 and G/SCM/N/48/COL, G/ SCM/N/60/COL and
G/SCM/N/71/COL of 7 January 2002), it did not include the so-called "export processing free zones
for tourist services or tourist free zones", established pursuant to Article 1 of Decree 2233 (document
G/SCM/Q3/COL/17)?
2. By virtue of Law No. 677 of 2001, Colombia instituted the "special economic export zones",
for the purpose of establishing special legal conditions for the promotion, development andimplementation of processes for the production of goods and services for export, within the territorial
limits of specified Colombia municipalities and their metropolitan areas.  Article 16 of the Law states
that "industrial projects defined as eligible within special economic export zones shall receive
treatment equivalent to the treatment accorded to industrial users of goods or services in export
processing zones for goods and services", which means that, in tax matters, they shall be exempt from
"the income and supplementary taxes on that part of their income that is obtained from sales to
foreign markets".  In addition, payments, credits to accounts and transfers abroad in respect of interestand technical services are not subject to taxes on income and remittances".
Could Colombia explain essentially why, in its request and initial notification to the WTO for
approval of the extension of the "industrial free-zone regime for goods and services" (documents
G/SCM/N/74/COL of 15 January 2002 and G/SCM/N/48/COL, G/ SCM/N/60/COL and
G/SCM/N/71/COL of 7 January 2002) , it did not include the so-called "special economic export
zones"?
3. Could Colombia indicate whether it considers that the above-mentioned tourist free zones, as
well as the special economic export zones, do not constitute prohibited export subsidies, extension of
which should have been requested and authorized by the WTO in 2002?  If so, on what grounds wasthis opinion based?G/SCM/Q3/COL/26
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4. Could Colombia explain why its draft reform of internal legislation on the free-zone regime
does not include the elimination of subsidies (tax on income and remittances) provided for in
Article 57 of Decree 2233 concerning payments, credits to accounts and transfers abroad in respect of
interest and technical services effected by industrial users of free zones?
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