G/SCM/N/253/DOM  
G/SCM/N/260/DOM  
3 July 2013  
(13-3488)  Page: 1/7  
Committee on Subsidies and 
Countervailing Measures  Original: Spanish  
 
  SUBSIDIES 
NEW AND FULL NOTIFICATION PURSUANT TO ARTICLE XVI:1 OF THE GATT 1994  
AND ARTICLE 25 OF THE AGREEMENT ON SUBSIDES  
AND COUNTERVAILING MEASURES 
UPDATED NOTIFICATION UNDER PARAGRAPH 2(c)  
OF GENERAL COUNCIL DECISION WT/L/691 
DOMINICAN REPUBLIC  
The following communication, dated 1 July 2013, is being circulated at the request of the 
delegation of the Dominican Republic. 
 
_______________ 
 
 Pursuant to Article XVI:1 of the GATT 1994 and Article 25.1 of the WTO Agreement on Subsidies 
and Countervailing Measures (SCM Agreement), and in accordance with paragraph 2(c) 
of General Council Decision WT/L/691, dated 27 July 2007, the Dominican Republic hereby submits the updated annual notification for the calendar year 2012. Also included as an integral part of this 
notification, in accordance with paragraphs 1(e) and (f) of the Decision, is information concerning 
measures taken with regard to the action plan for eliminating the export subsidies under the 
notified programme and the notification of beneficiaries.  
This updated notification is also being su bmitted so that the Committee on Subsidies 
and Countervailing Measures may verify, in its annu al review, that the transparency and standstill 
requirements set forth in paragraphs 2 and 3 of Decision WT/L/691 have been fulfilled. G/SCM/N/253/DOM • G/SCM/N/260/DOM 
- 2 - 
  In accordance with the format of the questionnaire in document G/SCM/6, prepared and adopted 
by the Committee on Subsidies and Countervailing Measures, the Dominican Republic hereby notifies the following:  
1. Title of the subsidy programme, if relevant , or brief description or identification 
of the subsidy 
 
Law No. 8-90 to "promote the establishment of new free zones and expand existing ones", 
which establishes a tax-exemption programme for enterprises manufacturing goods or providing 
services related to goods production, located within geographic areas known as free zones, and the production of which must be mainly for export. 
 
2. Period covered by the notification 
 
This notification covers the period up to 31 December 2012. 
 3. Policy objective and/or purpose of the subsidy 
 
The objectives of the programme are, inter alia , job creation, workforce training, development 
of social support programmes, promotion of balance-of-payments equilibrium and establishment of regional community development programmes. 
 
4. Background and authority for the subsidy (including identification of the 
legislation under which it is granted) 
 
The underlying reasons for this programme were to provide training, to transfer technology, to attract local and foreign investment, and to create employment at various points within 
the national territory, including in economically deprived areas, such as the border areas with 
Haiti. This programme was created under Law No. 8-90 of 15 January 1990.  5. Form of the subsidy (i.e. grant, loan, tax concession, etc.) 
 
Enterprises manufacturing goods or providing services and operating under Law No. 8-90 are exempt from payment of income tax and customs du ties on the importation and exportation of the 
raw materials, equipment and machinery used to produce these goods. The subsidy is therefore 
a tax concession.  
6. To whom and how the subsidy is provided (whether to producers, to exporters, 
or others; through what mechanism;  if the latter, how determined) 
 The programme exempts natural and legal persons e ligible under the free-zone regime established 
by Law No. 8-90, from the taxes and duties specified in point 5 of this questionnaire. 
 7. Subsidy per unit, or in cases where this is not possible, the total amount or the 
annual amount budgeted for that subsidy (indicating, if possible, the average 
subsidy per unit in the previous year).  Where provision of per-unit subsidy 
information (for the year covered by the notification, for the previous year, 
or both) is not possible, a full explanation 
 Law No. 8-90 does not provide for the auditing, on the basis of either units or operating results, 
of manufacturing operations conducted within free zones by enterprises operating under 
the free-zone regime, with a view to estimating the fiscal cost to the Dominican State of attracting 
private investment for the creation of sources of employment.  
8. Duration of the subsidy and/or any other ti me-limits attached to it, including date 
of inception/commencement 
 
Enterprises eligible for the benefits granted under Law No. 8-90 are entitled to a free-zone 
operating licence, normally valid for up to 20 years in the border region with Haiti and 15 years in the rest of the country. Beyond this period, permit holders may apply for a renewal.  G/SCM/N/253/DOM • G/SCM/N/260/DOM 
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  9. Information on paragraph 2(a) of General Council Decision WT/L/691 
 In order to comply fully with paragraphs 1(e) and (f) of General Council Decision WT/L/691, the Dominican Republic has implemented the following measures: 
 
(a) All resolutions and/or operating licences issued under the free-zone regime established 
by Law No. 8-90 contain the following paragraph: "As of 2015, the Dominican Republic will 
reserve the right to review and/or withdraw some of the incentives contained 
in Law No. 8-90, pursuant to the Decision of the World Trade Organization (WTO) Committee on Subsidies and Countervailing Measures, contained in document G/SCM/120, concerning the extension provided for in Article 27.4 of the Agreement on Subsidies 
and Countervailing Measures, adopted by the WTO General Council on 27 July 2007". 
 (b) The Dominican Republic has already launched its action plan for the elimination of export 
subsidies. For example, it submitted to Congress a draft law on free zones which provides 
for the complete dismantling of export subsidies. In addition, by Law 139-11 of 24 June 2011, it amended Article 17 of law 8-90 in respect of export performance 
requirements so that companies under the programme can market their goods and services 
locally without quantitative limits. 
 10. Statistical data permitting an assessmen t of the trade effects of the subsidy. 
The specific nature and scope of such stat istics is left to the judgement of the 
notifying Member. To the extent possible, relevant and/or dete rminable, however, 
it is desirable that such information incl ude statistics of production, consumption, 
imports and exports of the subsid ized product(s) or sector(s): 
 a. For the three most recent years for which statistics are available; 
b. For a previous representative year, which, where possible and meaningful, 
should be the latest year preceding the introduction of the subsidy or preceding 
the last major change in the subsidy. 
   
  G/SCM/N/253/DOM • G/SCM/N/260/DOM  
- 4 - Evolution of the Main Variables of Free-Export Zones 
1996-2012 
 
Year Existing 
industrial 
estates Enterprises Jobs Exports 
(US$ million)  Foreign 
exchange 
(US$ million)  Average weekly salary (RD$)  Surface area 
of industrial 
premises in 
use (sq. ft.) Textile 
exports 
(US$ million)  Workers Technical 
staff 
1996 36 436 164,639 3,107.30 545.00 576.92 1,257.00 13,782,496 1,753.5 
1997 40 446 182,174 3,596.40 701.00 634.27 1,441.12 15,603,755 2,185.1 
1998 43 496 195,193 4,100.00 826.50 638.32 1,556.90 17,540,407 2,348.9 
1999 44 484 189,458 4,331.50 887.30 701.21 1,587.22 16,820,049 2,393.1 
2000 46 481 195,262 4,770.60 1,018.60 716.51 1,629.85 21,068,186 2,555.4 
2001 51 512 175,078 4,481.60 977.90 775.49 1,662.93 21,738,332 2,314.4 
2002 53 520 170,833 4,317.30 886.50 786.56 1,671.53 21,923,764 2,226.8 
2003 54 531 173,367 4,406.76 810.84 961.34 2,010.79 22,066,221 2,196.4 
2004 58 569 189,853 4,685.24 863.40 1,131.25 2,539.82 24,332,619 2,120.6 
2005 57 556 154,781 4,749.65 1,005.43 1,347.09 2,702.67 24,540,453 1,904.6 
2006 56 555 148,411 4,678.60 973.70 1,465.19 3,009.97 26,338,045 1,734.4 
2007 53 526 128,002 4,525.22 1,010.90 1,480.37 3,127.22 24,609,123 1,366.9 
2008 48 525 124,517 4,354.10 954.30 1,652.80 3,533.22 25,299,745 1,165.7 
2009 47 553 112,618 3,793.50 959.00 1,819.00 3,689.56 29,037,745 933.5 
2010 48 555 121,001 4,217.60 1,123.05 1,829.03 3,841.64 29,268,270 964.2 
2011 51 578 125,117 4,884.50 1,163.50 1,967.15 3,996.63 30,067,076 1,295.6 
20121 53 584 134,226 4,987.90 1,298.20 2,175.88 4,204.14 30,385,855 1,278.1 
% growth 
2011-2012 3.9 1.0 7.3 2.1 11.6 10.6 8.0 1.1 -1.4 
1 Preliminary export and foreign exchange figures 
Source for exports and fore ign exchange: Central Bank. 
 
 G/SCM/N/253/DOM • G/SCM/N/260/DOM 
- 5 - 
  Contribution of Free Zones to the Gross Domestic Product (GDP) 
of the Dominican Republic 
1996-2012 
(RD$ million, current values) 
 
Year GDP Free zone s Contribution (%) 
1996 233,833.30 9,380.50 4.0 
1997 274,423.90 11,510.80 4.2 
1998 311,282.80 15,159.60 4.9 
1999 343,745.30 16,728.80 4.9 
2000 388,301.90 19,990.30 5.1 
2001 415,520.90 21,026.40 5.1 
2002 463,624.30 25,249.90 5.4 
2003 617,988.90 46,076.50 7.5 
2004 909,036.80 66,405.10 7.3 
2005 1,020,002.00 49,395.80 4.8 
2006 1,189,801.90 53,296.30 4.5 
2007 1,364,210.30 51,917.00 3.8 
2008 1,576,162.80 56,084.60 3.6 
2009 1,678,762.60 50,939.10 3.0 
2010 1,901,896.70 56,179.40 3.0 
2011 2,119,301.80 68,763.00 3.2 
2012* 2,316,783.70 72,074.50 3.1 
* Preliminary figures. 
Source:  Central Bank of the Dominican Republic. 
 
Comparison of Domestic and Free-Zone Exports 
1996-2012 
(US$ million) 
 
Year Domestic 
exports Growth % 
Domestic Free-zone 
exports Growth % 
Free zones Total 
exports Free-zone 
exports/total 
exports (%)  
1996 945.5 --- 3,107.3 --- 4,052.8 76.7 
1997 1,017.3 7.6 3,596.4 15.7 4,613.7 78.0 
1998 880.3 -13.5 4,100.0 14.0 4,980.3 82.3 
1999 805.2 -8.5 4,331.5 5.6 5,136.7 84.3 
2000 966.1 20.0 4,770.6 10.1 5,736.7 83.2 
2001 794.7 -17.7 4,481.6 -6.1 5,276.3 84.9 
2002 847.7 6.7 4,317.3 -3.7 5,165.0 83.6 
2003 1,064.0 25.5 4,406.8 2.1 5,470.8 80.6 
2004 1,250.7 17.5 4,685.2 6.3 5,935.9 78.9 
2005 1,395.1 11.5 4,749.7 1.4 6,144.8 77.3 
2006 1,931.4 38.4 4,678.6 -1.5 6,610.0 70.8 
2007 2,635.1 36.4 4,525.2 -3.3 7,160.3 63.2 
2008 2,393.9 -9.2 4,354.1 -3.8 6,748.0 64.5 
2009 1,689.3 -29.4 3,793.5 -12.9 5,482.8 69.2 
2010 2,536.1 50.1 4,217.6 11.2 6,753.7 62.4 
2011 3,727.8 47.0 4,884.5 15.8 8,612.3 56.7 
20121 4,091.4 9.8 4,987.9 2.1 9,079.3 54.9 
1 Revised figures. 
* Preliminary figures. 
Source: Central Bank of the Dominican Republic. G/SCM/N/253/DOM • G/SCM/N/260/DOM 
- 6 - 
  Comparison of Domestic and Free-Zone Exports 
2012 
 
 
Free-Zone Exports 2003-2012 by Principal Activities 
(US$ million) 
 
Activity 2003 2004 2005 2006 2007 2008 2009 2010 2011 20121 Share %  
2012 
Clothing and 
textiles 2,196.4 2,120.6 1,904.6 1,734.4  1,366.9  1,165.7  933.5  983.9  1,295.6 1,278.1 25.6 
Medical and pharmaceutical 
products 320.7 583.1 647.3 712.9  774.0  855.6  963.0  1,070.7  1,178.5 1,228.4 24.6 
Electrical goods 577.6 630.5 700.3 695.7  743.3  794.7  565.5  581.6  623.9 650.9 13.0 
Jewellery 466.8 601.0 602.9 625.9  678.4  505.4  435.7  466.2  527.2 449.5 9.0 
Tobacco and tobacco 
products 287.6 308.6 334.1 366.9  393.6  429.9  403.1  426.6  424.7 506.4 10.2 
Footwear 202.6 234.7 315.3 276.1  258.7  234.7  201.0  312.8  389.1 406.5 8.1 
Other 355.0 206.8 245.1 266.7  310.3  368.1  291.7  375.7  445.5 468.0 9.4 
Total 4,406.8 4,685.2 4,749.7 4,678.6  4,525.2  4,354.1  3,793.5  4,217.5  4,884.5 4,987.9 100.0 
1 Revised figures. 
* Preliminary figures. 
Source:  Central Bank of the Dominican Republic. G/SCM/N/253/DOM • G/SCM/N/260/DOM 
- 7 - 
  Free-Zone Exports by Principal Activities 
2012 
 
26%
25%
13%9%10%8%9%
Clothing and textiles
Medical and pharmaceutical  products
Electrical goods
Jewellery
Tobacco and tobacco products
Footwear
Other
 
 
 
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