WORLD TRADE
ORGANIZATIONG/SCM/Q2/FJI/11
G/SCM/Q3/FJI/15
27 November 2003
(03-6322)
Committee on Subsidies
and Countervailing MeasuresOriginal:  English
SUBSIDIES
New and Full Notification Pursuant to Article XVI:1
of the GATT 1994 and Article 25 of the Agreement
on Subsidies and Countervailing Measures
Extension Under SCM Article 27.4 of the Transition Period for the
Elimination of Export Subsidies Pursuant to the Procedures
in Document G/SCM/39
Replies to Questions from the UNITED STATES1
Regarding the Notifications of FIJI2
The following communication, dated 21 November 2003, is being circulated at the request of
the Delegation of Fiji.
_______________
According to information provided in G/SCM/Q2/FJI/8 and G/SCM/Q3/FJI/12
(1 October 2003), the Government of Fiji established an Exporters Club to administer a Duty
Suspension Scheme (DSS) that came into effect from 1 July 2002.  The DSS is essentially an
investment incentive package that enables exporter s to use world priced inputs in their products
to improve competitiveness.  The DSS also rele ases cash tied up with the import duty and VAT
thus enabling exporters to operate at their maximum potential.
Q1. Please provide a copy of the legislation which establishes the Duty Suspension Scheme to
the Secretariat for review by the SCM Committee.
Reply
The DSS had been passed by Parliament and is contained in:
• Customs (Duty Suspension Scheme) (Amendment) Act No. 9 of 2002;
• Customs Tariff (Duty Suspension Sche me) (Amendment) Act No. 10 of 2002;
• Value Added Tax Decree (Amendment) Act No. 11 of 2002;  and
• Customs (Duty Suspension Scheme) Regulations 2002, gazetted as Legal Notice No. 35.
                                                     
1 G/SCM/Q2/FJI/10-G/SCM/Q3/FJI/14
2 G/SCM/N/95/FJI-G/SCM/N/99/FJIG/SCM/Q2/FJI/11
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Q2. Please describe how the Duty Suspension Scheme operates.
Reply
The Duty Suspension Scheme belongs to the category of customs arrangements referred to
internationally as "Inward Processing Relief" (IPR ).  IPR means that certain goods can be brought
into a customs territory and conditionally relieved from payment of import duties and taxes, on the
basis that such goods are intended for manufacturing, processing and subsequent exportation.
Under the Scheme, goods or materials imported for processing for export are not subject to
import duties or V.A.T.  This concession is granted only if the applicant has concrete intentions toengage in an activity that involves the import of raw materials or goods and the substantial
transformation of these into products for subsequent re-exportation.  There is a presupposition that
companies involved in the Scheme have an export business or at least have confirmed export contract
for products to be manufactured in Fiji.
Q3. Please describe all criteria that must be satisfied by investors to participate in the Duty
Suspension Scheme.
Reply
Companies that have been, or would have been entitled to concessions under either the Tax
Free Factory/Tax Free Zone or the Fifth Schedule Exports Incentive Scheme are encouraged to join
the DSS.  In addition, companies that plan to export in future are also encouraged.
Companies that apply to join the DSS must be engaged in an activity that involves the import
of materials and goods and the transformation of these materials or complete consumption into a
finished product that is substantially different from the original and will subsequently have a different
first four digits of the nomenclature.
Q4. Does the scheme require satisfaction of ex port or import substitution performance
requirements?
Reply
Yes.
Q5. Does the DSS also suspend payment of value-added tax?
Reply
Yes.
Q6. Please describe the products that are eligible for duty, and if applicable, VAT
suspension under DSS.  Are capital goods eligib le for duty and/or VAT suspension under DSS?
Persons that solely manufacture excisable goods or goods that fall under the agricultural or
mining industry are expressly excluded from joining the scheme.
Every application for membership will be submitted with a list of goods or materials that is
intended for importation under the scheme.  The approved list will usually be based on actual export
performance.  The list will be verified by the Organization and forwarded to the Comptroller forG/SCM/Q2/FJI/11
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approval.  Amendments to the approved list may be done by the submission of an application to the
Organization, which after vetting and processing will submit to the Comptroller for final approval.
Q7. Please describe how the mechanism works to  release cash tied up with the import duty
and VAT.
Reply
The DSS is value-based.  Exporters will be entitled to credits based on the dollar value of
exports.  Other features of the Scheme include opening credit;  monthly acquittals of opening credits;
advance of credits;  monthly acquittals of advance credits;  credits earned;  transfer of credits andEntitlement Proportion ratio for the measurement of its performances.
EP Ratio
The Exporters Club will determine the Entitlement Proportion (EP) ratio in consultation with
the applicant. The EP ratio must be determined prio r to joining the scheme.  Under the DSS, for every
dollar of exports achieved a member would be provided credits to import, duty and V.A.T. free an
amount equal to the proportion of approved imported inputs required to produce exports, which is the
EP.  The EP would vary depending on the type of activity undertaken.
Formula:
Entitlement Proportion (EP) ratio = Approved Imported Inputs ÷ DSS Export
Example:
Company ABC exports $100 [f.o.b.] of shirts
Material (buttons, thread, fabric, etc.) content of these shirts is $50 [c.i.f.]
. . .  Proportion [%] of materials into final product =
Approved Imported Material Cost ÷ Export Value
=      $50  ÷ $100
=       50%
Realistically, detailed production cost may not be required to calculate EP ratio as implied by
the formula.  Alternatively, historical import and export records together with audited financialstatements would be the primary source for deriving  EP ratios.  However, for those DSS firms that
post ER ratios greater than 65%, they would be required to provide detailed production cost
information.
Revision of entitlement proportion
Licensees may seek an amendment, revision or a variation of their EP (Form DSS 4).  The
Exporters Club will verify the completeness and correctness of the request before forwarding to
Customs for approval.
Opening Credit
DSS recognizes that import of materials must precede the production and subsequent export
of the goods.  Opening credits will be granted based on trading history:  two months of imports.
These opening credits will be paid back on a monthly basis over a 12-month period.G/SCM/Q2/FJI/11
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Formula:
Opening Credit Balance = DSS Exports x EP ratio x .167
Example:
Company ABC exported $10 million in the trading year ending 31 December 2001
EP determined at 50%
As opening credit   =    DSS Exports x EP ratio x 2 months
. . .  Opening credit   =     $10 M x 50% x .167
        =     $835,000.00
Monthly Acquittals of Opening Credit Balance
The opening credit is to be proportionately reduced on a monthly basis over the period of one
year.
Formula:
Monthly Acquittals = Opening Credit Balance ÷ 12
Example:
If opening credit = $835,000.00
. . .  Pay back each month over 1 year = $835,000.00 ÷ 12
= $69,583.34
Advance of Credits
DSS recognizes that exporters may need to increase volume of exports and so need to import
more raw materials than the credits they are holding.  Additional advancement of credits will be
granted based on supporting evidence such as firm orders on hand.  The request for the advancement
of the credit shall be vetted and processed by the Exporters Club before submission to the Comptroller
for final approval.
Monthly Acquittals of Advance Credits
Any credits advanced to the licensee shall be proportionately reduced over a number of
months as determined by the Exporters Club on a case-by-case basis.
Formula:
Monthly Acquittal = Advance Credit ÷ number of months determined by the Organization
Transfer of Credits
A licensee wishing to transfer its import credits to another member of the Scheme shall make
an application to the Exporters Club.  The Exporte rs Club will process the application and submit with
recommendations to the Comptroller for approval.G/SCM/Q2/FJI/11
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List of Materials
Each applicant must provide a list of imported materials used in the production process.  The
Exporters Club will vet and process the materials list before forwarding it to the Comptroller for their
final approved list, which all manufacturers in an industry type can import with duty suspended.
Amendment to Approved Materials List
Licensees will be able to amend their approved list of materials on submission to the
Exporters Club.  The Exporters Club will vet and pro cess the application before forwarding it to the
Comptroller for approval.
Utilization of Import Credits
Licensees will make an 'Application to Import and Utilize Credits' to the Comptroller as an
attachment to the relevant Customs import documents (SAD).  The SAD pertaining to the import ofgoods or materials for the Scheme will be processe d in ASYCUDA.  This SAD will then be extracted
to update or refresh the DSS database overnight.  It should be noted that only paid SADs will be
picked up by the ASYCUDA for the purposes of updating the DSS software programme.
Earning of Import Credits
Licensees will make an application to the Comptroller as an attachment to the relevant
Customs export documents (SAD).
Q8. Please describe the “Exporters Club” and eligibility and participation requirements for
it.
Reply
The Exporters Club is a company limited by a guarantee and not having a share capital.  The
Exporters Club is a private sector led organization established primarily for the administration of the
DSS.  Its objective is to improve the competitiven ess of all exporting-oriented industries in Fiji.
Q9. Does the Government of Fiji finance the Exporters Club?  Does the Government of Fiji
direct, operate or have any other involvement in  the Exporters Club?  If so, please describe.
Reply
No.
Q10. Does the DSS have an indefinite duration?  If not, what is the termination date?
Reply
Yes.G/SCM/Q2/FJI/11
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[Legal Notice No. 35]
CUSTOMS (DUTY SUSPENSION  SCHEME) REGULATION 2002
ARRANGEMENT OF REGULATIONS
1. Citation and commencement
2. Interpretation
3. These Regulations to be in addition to other lawful requirements
4. Directions of the Minister
5. Kyoto Convention6. Forms
7. Transactional charges
8. Organization
9. Eligibility for membership of DSS
10. Export criterion and suspension of duty on packing and packaging items11. When duty suspension will not be allowed
12. Application to join DSS
13. Approved list of imported materials
14. Amendment to approved list of imported materials
15. Generation and use of credits16. Opening credit balance
17. Monthly acquittals of opening credits
18. Advance of credits
19. Monthly acquittals of advance credits
20. Credits earned21. Entitlement proportion (EP) ratio
22. Revision of entitlement proportion
23. Application to import and utilize import credits
24. Application to export and earn import credits
25. Transfer of credits
26. Payment of duties and taxes
27. Obligations of the licensee28. Comptroller may delegate areas for different activities within specified premises
29. Separate SAD for DSS exports
30. Comptroller may require licensee to maintain record of activities
31. Comptroller may require Organization to maintain record of activities
32. Software33. Comptroller to keep record of all licences issued under DSS
34. Comptroller may determine quantity and value of goods
35. Organization to report non-compliance
36. Goods not be destroyed
37. Customs access38. Breach of Act and Regulations
39. Contravention is an offence
CUSTOMS ACT
(Act No. 11 of 1986)
CUSTOMS (DUTY SUSPENSION  SCHEME) REGULATIONS 2002
In exercise of the powers conferred upon me by section 36H of the Customs Act 1986, I have
made the following Regulations.G/SCM/Q2/FJI/11
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Citation and commencement
1. These Regulations may be cited as the Customs (Duty Suspension Scheme) Regulations 2002
and come into force on 1 July 2002.
Interpretation
2. In these Regulations, unless the context otherwise requires:
"applicant" means a person who makes an application to join DSS;
"approved list" means the list of items that will be provided to each DSS firm upon the grant
of its DSS licence, specifying or detailing the items that will not be subject to duty;
"DSS" means the duty suspension scheme and "scheme" has a corresponding meaning;"EP" means entitlement proportion;"Kyoto Convention" means the international convention on the simplification and
harmonization of Customs procedures;
"licensee" means a person licensed by the Comptroller under DSS and "DSS firm" has a
corresponding meaning;
"membership" means entry into DSS;"Organization" means the private sector led organization responsible for the administration of
DSS;
"SAD" means single administrative document;"software" means the software used in the administration of the scheme;"substantial transformation" means imported inputs, which upon manufacturing or processing
will result in a finished product that is substantially different from the original by virtue of a change to
the classification of goods in its first four digits of the nomenclature.
These Regulations to be in addition to other lawful requirements
3. (1) The provisions of these Regulations are, unless the context otherwise requires, in
addition to, and not in substitution for, the provisi ons of any written law relating to the importation of
goods and its subsequent exportation from Fiji under DSS.
(2) The grant of any licence under DSS shall not absolve any person from the obligation
to comply with the provisions of any other wri tten law relating to the importation or exportation of
those goods.
Directions of the Minister
4. The Minister may give the Comptroller general or special directions, not inconsistent with
these Regulations or any other law, to be followed by the Comptroller in the exercise of hisG/SCM/Q2/FJI/11
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responsibilities and powers under these Regulations, and the Comptroller must give effect to any
direction so given.
Kyoto Convention
5. The standards and guidelines contained in the Kyoto Convention may from time to time be
adopted for the purposes of this scheme.
Forms
6. (1) The Comptroller may from time to time prescribe forms that are to be used for the
administration of the scheme.
(2) Where a form approved by the Comptroller contains by way of note or otherwise, a
clear direction or indication of any requirement as to the colour, size or manner of use thereof, the
requirements so directed or indicated are deemed to be prescribed.
Transitional charges
7. (1) Each licensee is liable to pay a fee or charge to the Organization for transacting on
their behalf.
(2) The fee or charge shall be determined by the Organization with the approval of the
Comptroller.
(3) Any decrease or increase in the fee or charge payable by the licensees shall only be
done with the express approval of the Comptroller.
Organization
8. (1) The Organization shall be registered in accordance with the Companies Act
(Cap. 247).
(2) The Organization will endeavour to ensure that the scheme is managed efficiently and
the incentives are not being abused.
(3) For the purpose of this scheme, the Organization will, subject to final approval by the
Comptroller, be responsible for the vetting of application for membership, establishment ofentitlement proportions and the determination of opening credits and list of approved imports to DSS
firms.
(4) Exporters seeking the benefits available under the scheme shall be registered with the
Organization.
Eligibility for membership of DSS
9. (1) In order to qualify for membership, an applicant must be an exporter who imports
goods and materials for manufacture or production wherein these goods or materials will betransformed or completely consumed into a finished  product that is substantially different from the
original and will subsequently have a different first four digits of the nomenclature.
(2) Persons that solely manufacture excisable goods or goods that fall under the
agricultural or mining industry are expressly excluded form joining the scheme.G/SCM/Q2/FJI/11
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Export criterion and suspension of duty on packing and packaging items
10. (1) Substantial transformation will be the key criterion for differentiating exports that
qualify under DSS and those that do not.
(2) Duty will be suspended on packing or packaging items used in connection with the
manufacturing or processing of goods or materials used in the scheme.
When duty suspension will not be allowed
11. Duty suspension shall not be allowed on any goods:
(a) if such goods are prohibited by any law from being exported;
(b) that are not shipped or exported or otherwise accounted for to the satisfaction of the
proper officer;
(c) which are damaged or spoiled;  and
(d) unless such goods are produced to the proper officer for examination at the approved
place of examination prior to exportation, if required by a proper officer.
Application to join DSS
12. (1) A person that wishes to join the scheme must formally lodge an application with the
Organization.
(2) All applicants shall be required to fill out a standard form and pay the requisite
(3) An application for membership will be processed and vetted by the Organization
before it is submitted to the Comptroller for final approval.
Approved list of imported materials
13. (1) Every application for membership will be submitted with a list of goods or materials
that is intended for importation under the scheme.
(2) The approved list will usually be based on actual export performance.
(3) The list will be verified by the Organization and forwarded to the Comptroller for
approval.
Amendment to approved list of imported materials
14. (1) Any licensee that wishes to amend its approved list of imported materials must do so
by way of an application that is submitted to the Organization.
(2) The Organization will vet and process the request for an amendment to the approved
list before it is submitted to the Comptroller for final approval.G/SCM/Q2/FJI/11
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Generation and use of credits
15. (1) A licensee will only qualify for suspension of duty if he has sufficient credits
available to him.
(2) Each licensee shall be provided with an opening credit balance in accordance with
regulation 16.
(3) Importation of goods or materials under the scheme shall reduce the credit balance of
the licensee equivalent to its value for duty.
(4) Exportation of goods or materials under the scheme shall increase the credit balance
by an amount determined in regulation 20.
Opening credit balance
16. (1) An opening credit balance in dollar amount shall be provided to a licensee for
importation of goods and materials under the scheme.
(2) The opening credit shall be calculated by the Organization before it is submitted to
the Comptroller for final approval.
(3) The credit provided for in sub-regulation (1) shall be equivalent to 2 months of the
actual value of approved imports required to produce DSS exports in that year.
(4) The opening credit may be calculated on the basis of the following formula:
Opening Credit = DSS Exports x EP ration x .167.
Monthly acquittals of opening credits
17. (1) The opening credit balance shall be proportionately reduced on a monthly basis,
commencing at the end of each calendar month, over a one year period.
(2) The reduction referred to in sub-regulation (1) may be calculated on the basis of the
following formula:
Monthly Acquittal = Opening Credit Balance / 12.
Advance of credits
18. (1) If a licensee has insufficient credits to enable importation under the scheme, he may
apply to the Organization for an advancement of credit.
(2) An advance of credits may only be granted to a licensee upon receipt for a firm order
at hand or upon other such evidence as the Organization may require.
(3) The Organization will vet and process the request for an advancement of credit prior
to submitting it to the Comptroller for final approval.G/SCM/Q2/FJI/11
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Monthly acquittals of advance credits
19. (1) Any advance of credits shall be proportionately reduced on a monthly basis,
commencing at the end of each calendar month, over a period determined by the Organization.
(2) The reduction referred to in sub-regulation (1) may be calculated on the basis of the
following formula:
Monthly Acquittal = Advance Credit / Number of Months determined by the
Organization.
Credits earned
20. (1) A licensee upon exportation shall earn credits.
(2) The credit referred to in sub-regulation (1) may be calculated on the basis of the
following formula:
Credits Earned = DSS Exports x EP ratio.
Entitlement proportion (EP) ratio
21. (1) The EP ratio is an amount equal to the proportion of approved imported inputs
required to produce exports.
(2) The Organization will determine the EP ratio of each licensee, which will be
submitted to the Comptroller for final approval.
(3) The acceptable EP ratio for each licensee will fall between 0 and 65 per cent.
(4) An EP ratio that exceeds 65 per cent may be considered by the Comptroller on a case
by case basis with full justification and based on strong evidence.
(5) The EP ratio may be calculated on the basis of the following formula:
EP ratio = Approval Imported Inputs / DSS Exports.
Revision of entitlement proportion
22. (1) Any licensee that wishes to revise, vary or amend its EP ratio must do so by way of
an application that is submitted to the Organization.
(2) Any revision, variation or amendment to the EP ratio will need to be justified through
further documentary evidence that may include:
(a) import and export data for that business or industry for the last three years;
(b) audited financial statements to identify production costs of materials and estimated
imported material content;
(c) a detailed costing of each product exported.
(3) Any revision, variation or amendment to the EP ratio will be forwarded to the
Comptroller for final approval.G/SCM/Q2/FJI/11
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Application to import and utilize import credits
23. A licensee, that wishes to import and utilize import credits, must submit its application
together with a SAD to the Comptroller for approval.
Application to export and earn import credits
24. (1) A licensee, that wishes to export and earn import credits, must submit its application
together with a SAD to the Comptroller for approval.
(2) Once an application is processed and approved, the licensee earns import credits.
Transfer of credits
25. (1) Any licensee that wishes to transfer its import credits to another person that is also
licensed under the scheme must do so by way of an application that is submitted to the Organization.
(2) The Organization will process the application and make a recommendation to the
Comptroller for the transfer of credits between the transferor and the transferee.
(3) Upon approval being given by the Comptroller, the Organization will effect the
transfer of credits on DSS software and advise the persons involved accordingly.
Payment of duties and taxes
26. (1) A licensee under the scheme remains responsible for all suspended duties and taxes.
(2) Subject to sub-regulation (3), where a licensee transfers or sells the business to a new
person, who is not a licensee under the scheme, the licensee remains liable for all suspended dutiesand taxes.
(3) Where the licensee wants to transfer all its liabilities for suspended duties and taxes to
the new owner, the transfer shall be done with the prior approval of the Comptroller.
(4) Liability for duties and taxes will be permanently suspended when the imports for
manufacturing or production of DSS goods are exported either in their original form or incorporatedinto a finished product.
Obligations of the licensee
27. (1) Unless the Comptroller otherwise directs, a licensee shall, when taking delivery of
any goods or materials in respect of which he claims suspension of duty, make a written declaration,
in a form approved by the Comptroller, stating that those goods or materials are not to be used except
in the manufacture of goods of the kind specified in the licence.
(2) A licensee shall not store or use any goods or materials referred to in sub-regulation
(1) except:
(a) at the premises specified in the licence;  or
(b) at other premises approved by the Comptroller for that purpose.G/SCM/Q2/FJI/11
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(3) Except with the Comptroller's written permission and in accordance with any
conditions the Comptroller imposes, a licensee shall not:
(a) use any goods or materials in respect of which a suspension of duty has been obtained
except in the manufacture of goods of the kind specified in the licence;  or
(b) sell or otherwise dispose of those goods or materials or remove them from the
premises referred to in sub-regulation (2) before they have been used in the
manufacture of goods of the kind specified in the licence.
Comptroller may delegate areas for different activities within specified premises
28. (1) The Comptroller may designate different areas for different activities within the
specified premises of the licensee.
(2) Notwithstanding sub-regulation (1), the Comptroller may allow an existing activity to
be carried out at, from or on its present premises.
Separate SAD for DSS exports
29. Goods exported under DSS shall be exported under a separate SAD from other exports.
Comptroller may require licensee to maintain record of activities
30. (1) For the purpose of protecting the public revenue and such other purposes which are
deemed necessary and expedient for the proper functioning of DSS, the Comptroller may require the
licensee to maintain full and proper records of all activities carried out by them under DSS.
(2) A record referred to in sub-regulation (1) must, inter alia , contain details of:
(a) all goods received at the place or premises where the activities are carried out;
(b) waste stocks and the manner of their disposal or destruction;
(c) losses through spillage, evaporation and other causes;  and
(d) the balances of all goods stocked at the place or premises where the activities are
carried out.
(3) Unless exempted by the Comptroller, a licensee must comply with all directions
given by the Comptroller in respect of matters specified in sub-regulation (2).
(4) Every record kept under sub-regulation (1):
(a) must be made in an indelible fashion and must not be altered;
(b) must, where any entry is incorrect, be corrected by drawing a line through such entry
so that it remains legible, and the correct en try shall be made as close to the incorrect
entry as possible;
(c) must be made available to the proper officer of the Customs upon request at any
reasonable time;G/SCM/Q2/FJI/11
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(d) must not be destroyed unless approved in writing by the Comptroller.
(5) Nothing in this regulation affects any other obligation to keep any record under the
Income Tax Act (Cap. 201), the Value Added Tax Decree 1991 or any other written law.
Comptroller may require Organization to maintain record of activities
31. (1) The Organization shall maintain and manage records as required by the Comptroller.
(2) The Organization shall ensure that a monthly report is provided to the Comptroller.
(3) The Organization shall keep a record of the credit levels of each DSS firm.
(4) The Organization shall ensure that each applicant for import clearance has sufficient
credits before its application is submitted to the Comptroller.
(5) The Organization shall inform and make a report to the Comptroller upon notice that
a DSS firm has exceeded its level of credit and any remedial action that has been taken.
Software
32. (1) The Organization shall maintain data for each DSS firm in respect of membership
details and balance of credits, including opening credits, acquittals, transfer and advancement ofcredits.
(2) The Organization shall ensure that once approval of membership has been given to a
DSS firm, it will enter the details on the software and activate the membership.
(3) The Organization shall ensure that records kept on software of DSS firms are accurate
and up-to-date.
Comptroller to keep record of all licences issued under DSS
33. (1) The Comptroller must keep a record of all licenses issued under DSS.
(2) The record must, in respect of each licence, contain details of:
(a) the date of commencement and expiry of the licence;
(b) the name, registered address and the authorized officer of the licensee;
(c) the trade, business or manufacture to which the licence relates;
(d) the conditions attached to the licence;
(e) any variation or revocation of the licence by the Comptroller;  and
(f) any transfer of the licence approved by the Comptroller under Customs laws and
regulations.
(3) The Comptroller must inform the Organization of any entry made in the register kept
by him under Customs laws and regulations.G/SCM/Q2/FJI/11
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Comptroller may determine quantity and value of goods
34. The Comptroller may, after consultation with any licensee, manufacturer or producer,
determine the quantity and import value of any goods or materials required for the purpose ofmanufacturing or producing any goods in respect of which suspension of duty may be granted and the
quantity and value so determined shall be presumed, in the absence of evidence to the contrary, to
have been used in the manufacture or production of such goods.
Organization to report non-compliance
35. The Organization must inform the Comptroller of any non-compliance or suspected non-
compliance with the terms and conditions of a licence or with any customs laws of which it becomesaware.
Goods not to be destroyed
36. (1) A licensee must not destroy any goods imported under DSS except with the written
approval of and in the presence of a proper officer of the Customs.
(2) The approval under sub-regulation (1) may be obtained by applying in writing to a
proper officer of the Customs stating the type of goods to be destroyed, the quantity and the date it is
proposed to destroy the goods and the reasons for such request.
(3) The Comptroller may allow any goods or materials imported under DSS, which are
not worth the duty payable, to be destroyed under such conditions as he sees fit.
(4) Where goods are destroyed the proper officer of the Customs present must issue a
certificate to the owner of the goods or his or her representative certifying that the goods have been
destroyed and the certificate must be kept as a record by the licensee.
Customs access
37. (1) A proper officer of the Customs has for the purposes of the Customs laws at all
reasonable times free access to any premises, vehicles or vessels of a DSS firm and may:
(a) require the occupant of the premises to produce and permit him to examine any
records relating to any activity on the premises;
(b) seize and detain any records relating to any offence under the Customs laws and
require any person to answer questions relating to the records;
(c) stop and examine any vehicle or vessel for the purpose of ascertaining whether any
suspect goods are contained in it and request any person in control of or in charge of
the vehicle or vessel to open all parts of the vehicle or vessel for examination by theofficer;
(d) stop and search any person entering or leaving the premises of a DSS firm for the
purpose of ascertaining whether any suspect goods are being concealed by that
person;
(e) open any package or receptacle and examine any suspect goods which are being taken
into or removed from, or are intended to be taken into or removed from the premises
of a DSS firm;G/SCM/Q2/FJI/11
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(f) take and retain reasonable samples of any goods necessary for the performance of his
duties of enforcement under the Custom laws:  Provided that an official receipt shall
be given for any sample so taken;
(g) lock up, mark, seal or otherwise secure any premises, vehicles or vessels, goods,
materials or plant for the purpose of enforcing the Custom laws.
(2) Every person required by a proper officer of the Customs to give information or to
produce any document which it is the duty of such officer to investigate and which it is within the
power of such person to give or produce must give such information or produce such documents.
Breach of Act and Regulations
38. The Comptroller may also take the following actions if he believes that the actions of DSS
firms have or may impede the collection of revenue, either by way of tariffs or VAT:
(a) suspend a DSS firm;
(b) revise an EP;
(c) refuse to authorize a request to transfer import credits from one DSS firm to another;
(d) require a DSS firm to provide records of all exports and related imports and for this
purpose inspect premises, carry out physical stock checks and copy relevant
documents;
(e) require copies of documents relating to the operations of DSS firms from the
Organization;  or
(f) require the collection of all or part of duties and taxes that have been suspended.
Contravention is an offence
39. A person who contravenes any provision of these Regulations commits an offence and is
liable, on conviction, to a fine not exceeding F$2000 and any goods forming the subject matter of anysuch contravention shall be liable for forfeiture.
Made at Suva, 25 June 2002.
JY Kubuabola
Minister for Finance
and National PlanningG/SCM/Q2/FJI/11
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ACT NO. 9 OF 2002
J.I.ULUIVUDA
President
[1 May 2002]
AN ACT
TO AMEND THE CUSTOMS ACT
ENACTED by the Parliament of the Fiji Islands.
Short title, etc.
1. (1) This Act may be cited as the Customs (Duty Suspension Scheme) (Amendment)
Act 2002 and comes into force on a date appointed by the Minister by notice in the Gazette .
(2) In this Act, the Customs Act is referred to as the "principal Act".
Section 2 amended
2. Section 2 of the principal Act is amended in subsection (1) by inserting the following new
definition:
"'duty suspension scheme' means the Customs procedure under which certain goods or
materials can be imported into the Fiji Islands conditionally relieved from payment of import
duties and taxes, on the basis that the goods or materials are intended for manufacturing or
processing and subsequent exportation;".
Section 8 amended
3. Section 8 of the principal Act is amended in subsection (2) by deleting the full stop and
substituting a semi-colon at the end of the paragraph (g) and by adding the following paragraph:
"(h) goods subject to the duty suspension scheme under Part VIIB."
4. Section 24 of the principal Act is amended by repealing subsection (4) and substituting the
following subsection:
"(4) If the proper officer so requires, a bond or other security shall be given for the
warehousing of goods, goods entered pursuant  to the Tax Free Zones Decree 1991 or goods
entered under the duty suspension scheme."
New Part VIIB inserted
5. The principal Act is amended by inserting after Part VIIA the following new Part:
"PART VIIB – DUTY SUSPENSION SCHEME FOR IMPORTED GOODS
Power to grant licence, etc.G/SCM/Q2/FJI/11
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36G (1) The Comptroller may grant a licence to a person authorizing such person to import
and export goods that are subject to the duty suspension scheme.
(2) A person who intends to be licensed under subsection (1) may apply to the
Comptroller in the prescribed form and accompanied by the prescribed fee.
(3) The Comptroller may, at any time, in his discretion, revoke, cancel, or suspend a
licence, issued under subsection (1).
(4) Where the Comptroller makes a decision to revoke, cancel or suspend a licence in
accordance with subsection (3), the Comptroller shall cause to be served, either personally or byregistered post, on the licensee, a notice in writing setting out the Comptroller's findings on material
questions of fact, referring to the evidence or other material on which those findings were based and
giving the reasons for the decision.
(5) The Comptroller may, at any time, impose conditions on a licence issued under
subsection (1) that, in the opinion of the Comptroller are necessary for the protection of revenue or for
the purpose of ensuring compliance with this Act and may, at any time, revoke, suspend or vary such
conditions so imposed.
(6) Where the Comptroller makes a decision to revoke, suspend or vary a condition of a
licence in accordance with subsection (5), the Comptroller shall cause to be served, either personally
or by registered post, on the licensee, a notice in writing setting out the Comptroller's findings on
material questions of fact, referring to the evidence or other material on which those findings were
based and giving the reasons for the decision.
(7) A person who fails to comply with an y conditions imposed under subsection (5)
commits an offence and is liable on conviction to a fine not exceeding F$5,000.
Regulations
36H. The Minister may make regulations with respect to the operation or administration of the duty
suspension scheme.
Disputes relating to duty suspension scheme
36I. (1) The Minister may appoint a panel for a 3 year period consisting of:
(a) 4 legal practitioners who have had legal practice for not less than 5 years;
(b) 3 members nominated by the Exporters Club;  and
(c) 3 Customs Officers.
(2) Subject to subsection (3), if there is a dispute with respect to the operation or
administration of the duty suspension scheme, both parties to the dispute must refer the dispute to acommittee appointed from the panel under subsection (1) to hear and determine the dispute consisting
of:
(a) a legal practitioner as the chairperson;
(b) a member to represent the Exporters Club;  andG/SCM/Q2/FJI/11
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(c) a Customs Officer to represent the Customs.
(3) If the parties to a dispute are of the opinion that the dispute may be dealt with by a
single member, the parties must agree on a legal practitioner on the panel under subsection (1) to hear
and determine the dispute.
(4) A party to a dispute may appeal the determination of a dispute made under this
section to the Court of Review.
(5) This section does not apply to a decision in respect of matters to which appeals may
be heard by the Court of Review as set out in the Schedule.
(6) In this section, unless the context otherwise requires:
"dispute" means any grievance or disagreement brought by a person licensed under
this Part in relation to any decision made either by the Comptroller or the Exporters
Club relating to the duty suspension scheme;
"Exporters Club" means a company, association or body of persons, corporate or
unincorporated contracted by the Comptroller for the purpose of the duty suspension
scheme;
"legal practitioner" and "practice" have the meaning ascribed to them by the Legal
Practitioners Act 1997."
Section 92 amended
6. Section 92 of the principal Act is amended in subsection (6) by inserting "or under Part VIIB
of this Act" after "1991".
Schedule to Section 174 amended
7. The Schedule to the principal Act is amended by deleting the full stop at the end of item (iii)
and substituting a semi-colon and by adding the following new item:
"(iv) any amended assessment imposed under section 101A."
Passed by the House of Representatives, 4 April 2002.
Passed by the Senate, 23 April 2002.G/SCM/Q2/FJI/11
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ACT NO. 10 OF 2002
J.I.ULUIVUDA
President
[1 May 2002]
AN ACT
TO AMEND THE CUSTOMS TARIFF ACT
ENACTED by the Parliament of the Fiji Islands.
Short title and commencement
1. (1) This Act may be cited as the Customs Tariff (Duty Suspension Scheme)
(Amendment) Act 2002 and comes into force on the date of commencement of the Customs (Duty
Suspension Scheme) (Amendment) Act 2002.
(2) In this Act, the Customs Tariff Act is referred to as the "principal Act".
Section 10 amended
2. Section 10 of the principal Act is amended:
(a) in subsection (3) (inserted by Act No. 7 of 2001) by repealing paragraph (c) and
substituting the following new paragraph:
"(c) outline the benefit to the country that the concession will provide."
(b) by renumbering subsections (2) and (3) (inserted through Act No. 7 of 2001) as
subsections (3) and (4) respectively.
Section 11 title amended
3. The title to section 11 "Minister may grant remission or reduction of duties to assist
industries" is substituted by "Exemption from duty of goods imported under the Tax Free Zones
Decree 1991".
New Section 13A inserted
4. The principal Act is amended by inserting after section 13 the following new section:
"Exemption from duty of goods import ed under the duty suspension scheme
13A (1) The Minister may, subject to such conditions as the Minister may consider
necessary, exempt from payment of duty the importation or purchase ex-bond of
goods or materials if the Minister is satisfied that such goods or materials are to be
used by a person licensed under section 36G of the Customs Act."G/SCM/Q2/FJI/11
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Section 17 amended
5. Section 17 of the principal Act is amended:
(a) in subsection (1) by inserting after the words "chargeable under Schedule 2 with
duty" in line 1 with, "other than goods entered under the duty suspension scheme";
(b) by inserting the following subsection after subsection (1):
"(1A) Where imported goods chargeable under Schedule 2 with duty are subject to
the duty suspension scheme and are, at any time within 2 years from the date of
importation or delivery from a warehouse, disposed of or used for any purpose other
than that for which the duty was suspended under the duty suspension scheme, suchgoods shall thereupon become liable to duty at the rate and upon the value subsisting
at the date of such disposal, or of the goods being put to such other use, as determined
by the Comptroller.";
(c) by repealing subsection (2) and substituting the following new subsection:
"(2) A person to whom subsection (1) or (1A) applies shall pay the duty on such
goods and shall, not less than 14 days before the date of such disposal, or of the date
of the goods being put to such other use, make a report to the Comptroller in such
manner as the Comptroller may require to enable duty to be levied.";  and
(d) in subsection (4) by inserting "or in the ca se of goods subject to the duty suspension
scheme within 2 years from the date of importation", after "within 5 years of the date
of the importation of such goods".
Passed by the House of Representatives on 4 April 2002.
Passed by the Senate on 23 April 2002.G/SCM/Q2/FJI/11
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ACT NO. 11 OF 2002
J.I.ULUIVUDA
President
[1 May 2002]
AN ACT
TO AMEND THE VALUE ADDED TAX DECREE
ENACTED by the Parliament of the Fiji Islands.
Short title and commencement
1. (1) This Act may be cited as the Value Added Tax Decree (Amendment) Act 2002 and is
deemed to have come into force on a date appointed by the Minister by notice in the Gazette .
(2) In this Act, the Value Added Tax Decree 1991 is referred to as the "Decree".
Section 14 amended
2. Section 14 of the Decree is amended:
(a) in subsection (1) by deleting "Notwithstanding anything in this Decree" and
substituting "Subject to subsection (5)";
(b) in subsection (1) by repealing the proviso;
(c) by renumbering subsection (5) as subsection (6);  and
(d) by inserting after subsection (4) the following subsection:
"(5) Notwithstanding any other provision of this Decree, no tax shall be levied
under this Part in respect of importation of goods which are subject to the Tax Free
Zones Decree 1991 or the duty suspension scheme."
Passed by the House of Representatives, 4 April 2002.
Passed by the Senate, 23 April 2002.
__________