WORLD TRADE
ORGANIZATIONG/SCM/N/95/MAR
23 July 2003
(03-3946)
Committee on Subsidies and
Countervailing MeasuresOriginal:  French
SUBSIDIES
New and Full Notification Pursuant to Article XVI:1 of GATT 1994
and Article 25 of the Agreement on Subsidies
and Countervailing Measures
MOROCCO
The Secretariat has received the following communication, dated 3 July 2003, from the
Permanent Mission of the Kingdom of Morocco.
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The Permanent Mission of the Kingdom of Morocco to the Office of the United Nations in
Geneva and the other international organizations in Switzerland presents its compliments to the
Secretariat of the Committee on Subsidies and Countervailing Measures of the World Trade
Organization (WTO) and has the honour to submit the attached copy of Morocco's notification
prepared by the Ministry of Foreign Trade pursuant to Article 25.1 of the Agreement on Subsidies and
Countervailing Measures (ASCM).G/SCM/N/95/MAR
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NOTIFICATION BY MOROCCO PURSUANT TO THE AGREEMENT
ON SUBSIDIES AND COUNTERVAILING MEASURES
CONTENTS
Page
INTRODUCTION   3I. INVESTMENT INCENTIVES (HORIZONTAL MEASURES)   3II. PROGRAMME OF SUPPORT FOR THE FINANCING OF
ECONOMIC AND SOCIAL DEVELOPMENT   3
III. INCENTIVES FOR SMEs   4IV. EXPORT FREE ZONES   5V. EXPORT INSURANCE SYSTEM   5G/SCM/N/95/MAR
Page 3
INTRODUCTION
Morocco is submitting the present notification pursuant to Article 25.1 of the Agreement on
Subsidies and Countervailing Measures and Article XVI:1 of GATT 1994.  In accordance with
Article 25.7 of the Agreement on Subsidies and Countervailing Measures, the notification ofprogrammes or measures does not prejudge either their legal status, their nature or their effects under
GATT 1994 and the Agreement on Subsidies and Countervailing Measures (ASCM).
I. INVESTMENT INCENTIVES
1. Title or description of the subsidy
Framework Law No. 18-85 establishing an investment charter.
2. Objective of the subsidy
The investment charter is intended to promote investment and encourage employment through
incentives characterized by a certain inter-sectoral neutrality.  The measures provided for in thischarter concern:  tax charter reductions relating to transactions involving the purchase of equipment,
tools, capital goods or land needed for investment purposes, the promotion of employment and
regional development.
3. Beneficiaries and mechanism
The investment incentive measures provided for in the charter are horizontal in nature and
benefit every sector of activity.
4. Background and authority
Framework Law No. 18-85 establishing an investment charter promulgated on
8 November 1995.
5. Duration of the subsidy
The investment charter will continue in effect fo r 10 years from the date of its entry into force
in January 1996.
II. PROGRAMME OF SUPPORT FOR THE FINANCING OF ECONOMIC AND
SOCIAL DEVELOPMENT
1. Title or description of the subsidy
Hassan II Fund for Economic and Social Development.
2. Objective of the subsidy
In general, the Hassan II Fund provides financial assistance for any project that contributes to
the promotion of investment and employment.G/SCM/N/95/MAR
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3. Background and authority
Law No. 36-01 establishing the Hassan II Fund for Economic and Social Development
promulgated on 29 January 2002.
4. Form of the subsidy
The support provided by the Fund takes the form of a direct contribution to investors.
5. Beneficiaries and mechanism
New investment projects and extensions investing more than DH1 million in capital
equipment qualify for assistance from the Hassan II Fund.
6. Amount of the subsidy
The amount granted by the Hassan II Fund for the investment projects in question is of the
order of DH595 million.
7. Duration of the subsidy
The subsidy ends when the amount allocated is exhausted.
III. INCENTIVES FOR SMALL AND MEDIUM-SIZED ENTERPRISES (SMES)
1. Title or description of the subsidy
Incentives for Small and Medium-Sized Enterprises (SMEs)
2. Objective of the subsidy
The purpose of the State support is to preserve an environment that favours the establishment
and promotion of SMEs.
3. Background and authority
Law No. 53-00 establishing a charter for Small and Medium-Sized Enterprises (SMEs)
promulgated on 23 July 2002.
4. Form of the subsidy
The State support takes the form of a guarantee fund for loans made in connection with the
establishment of a budding enterprise.
5. Beneficiaries and mechanism
The purpose of the loan guarantee fund is to cover the risk incurred by credit institutions
participating in the financing of the investment projects of young entrepreneurs.G/SCM/N/95/MAR
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IV. EXPORT FREE ZONES
1. Title or description of the subsidy
Export free zones.
2. Objective of the subsidy
The objective of the measures taken within the framework of this programme is to promote
and encourage employment.
3. Background and authority
- Law No. 19-94 on export free zones promulgated on 26 January 1995.
- Law No. 1-76-366 of 23 April 1974 as amended by Law No. 1-92-282 of
29 December 1992 on export insurance.
4. Form of the subsidy
The measures in question are fiscal in nature.
5. Beneficiaries and mechanism
Any enterprise that establishes itself in a free zone is eligible for these incentives whatever the
sector of activity.
Such enterprises benefit from:- Exemption from registration fees and stamp duty;- exemption from Value Added Tax (VAT);- exemption from the National Solidarity Contribution (PSN) on profits subject to
Company Tax (IS);
- exemption for the first 15 years of operation from the trading licence tax and the
urban tax;
- exemption from Company Tax (IS) for five years from the date of commencement of
operations and reduction of the IS rate to 8.75 per cent for the next ten years;
- exemption from General Income Tax (IGR) for five years and application of a rebate
of 80 per cent on that tax for the next ten years.
V. EXPORT INSURANCE SYSTEM
The Export Insurance mechanism is intended to support the commercial efforts of exporters
by protecting them from risks such as political and transfer risks, exceptional commercial risks
relating to credit insurance, and risks relating to fair and market development insurance.
Fair Insurance:  This type of insurance guarantees exporters participating in a foreign fair or
commercial event the reimbursement of part of the expenses incurred in connection with theirG/SCM/N/95/MAR
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participation if they fail to do sufficient business to cover all their expenses, in particular those
connected with renting and equipping a stand, transport, transport insurance, packaging of the
exhibits, advertising, and staff travel and subsistence.
The reimbursement may not exceed 50 per cent of the expenses incurred.Market Development Insurance:  This insurance guarantees the exporter repayment of the
expenses incurred in developing new outlets if the return is insufficient.
The repayment may extend to 50 per cent of the expenses incurred and the market
development activities may relate to any country.
Credit Insurance:  This insurance protects the exporter against the risk of non-payment due to
political risk, natural disaster, exchange risk or any ordinary or exceptional commercial risk.
The percentage cover may not exceed 90 per cent of the debt insured.
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