G/SCM/N/155/TUN  
2 June 2016  
(16-2957)  Page: 1/18  
Committee on Subsidies and Countervailing Measures  Original: French  
 
  SUBSIDIES 
NEW AND FULL NOTIFICATION UNDER ARTICLE XVI:1 
OF THE GATT 1994 AND ARTICLE 25 
OF THE SCM AGREEMENT 
TUNISIA  
The following communication, dated 30 May 2016, is being circulated at the request of the 
delegation of Tunisia.  
_______________ 
  This communication is being submitted by the delegation of Tunisia as a new and full notification 
under Article XVI:1 of the GATT 1994 and Article 25 of the SCM Agreement and covers the 
period 2004-2006.   G/SCM/N/155/TUN 
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  TABLE OF CONTENTS 
1   BENEFITS GRANTED FOR REGIONAL DEVELOPMENT ................................................... 3  
2   INCENTIVES FOR POLLUTION CONTRO L AND ENVIRONMENTAL PROTECTION ............ 4  
3   PROMOTION OF TECHNOLOGY, RESEARCH AND DEVELOPMENT AND ENERGY 
SAVING ........................................................................................................................ .... 6 
4   ENCOURAGEMENT OF NEW ENTREPRENEURS, LIGHT INDUSTRIES AND SMALL 
AND MEDIUM-SIZED ENTERPRISES ................................................................................ 10  
5   EXPORT PROMOTION ................................................................................................ 13  
6   OTHER ADVANTAGES GRANTED UNDER LAW NO. 93-120 OF 
27 DECEMBER 1993 ENACTING THE INVESTMENT INCENTIVES CODE ............................ 14  
7   NATIONAL UPGR ADING PROG RAMME ....................................................................... 15  
8   INDUSTRIAL COMPETITIVENE SS DEVELOPMENT FUND (FODEC) .............................. 16  
9   AMOUNTS OF THE INCENT IVES GRANTED,  2004-20 06 .............................................. 17  G/SCM/N/155/TUN 
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1  BENEFITS GRANTED FO R REGIONAL DEVELOPMENT 
1. Investment incentives for industrial activities taking place in regional development areas 
comprise tax rebates, capital grants, payment by  the State of employer contributions to the 
statutory social security scheme and certain infrastructure expenses. 
2. This notification covers the period 2004-2006. 
3. These incentives come within the overall regional development programme aimed mainly at 
the central and southern regions of Tunisia, whic h are still at a disadvantage compared to the 
coastal areas where economic activity is heavily concentrated. They are designed to encourage the 
establishment of small and medium-sized enterprises in these regions and reduce interregional disparities. 
4. The legal texts governing regional development incentives are as follows: 
 Law No. 93-120 of 27 December 1993 enacting the Investment Incentives Code, as 
amended or supplemented by subsequent texts; 
 Law No. 73-82 of 31 December 1973 containing the Finance Law for the 1974 budget 
year, as amended or supplemented by subsequent texts; 
 Decree No. 99-483 of 1 March 1999 delimiting  regional development areas, as amended 
or supplemented by subsequent texts; 
 Decree No. 94-539 of 10 March 1994 setting out the capital grants, lists of activities and 
infrastructure and community facility projects eligible for regional development incentives, as amended or supplemented by subsequent texts, and in particular by 
Decrees Nos. 99-486 of 1 March 1999 and 2002-1363 of 11 June 2002; 
 Decree No. 94-494 of 28 February 1994 setting out the procedures for State payment of 
employer contributions to the statutory social security scheme, as amended or 
supplemented by subsequent texts, and in particular by Decree No. 95-1729 of 
25 September 1995. 
The areas for the promotion of regional development were designated in Annex I and I bis of 
Decree No. 99-483 of 1 March 1999 on the basis of  objective standards, principally the level of 
economic and social development of the regions concerned. 
5. Incentives for investment made in regional  development areas take the following form: 
a. deduction of all income or profits ploughed back into equity or used to increase the initial 
capital of the enterprise, and from personal income tax (IRPP) or corporation tax (IS), subject to a minimum tax payment; 
b. deduction of income or profits from the investment from personal income tax or 
corporation tax for the first ten years, and deduction of 50% of such income or profits for the following the ten years; 
c. full deduction of profits reinvested in the co mpany from net profits subject to corporation 
tax; 
d. waiver of contributions to the low-income housing development fund for the first 
five years of operation; 
e. an investment grant of 15% or 25% of the cost  of the project, excluding working capital, 
but including the cost of studies, up to a ceiling of TND 450,000 and TND 750,000, 
respectively; G/SCM/N/155/TUN 
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  f. a grant by way of State participation in the infrastructure expenditure necessary to the 
implementation of the project. This gran t may cover half to three quarters of 
expenditure on infrastructure within or outside the enterprise. 
6. All investors in the manufacturing activities set out in Decree No. 94-492 of 
28 February 1994, establishing the lists of activities by sector covered by the 
Investment Incentives Code, and located in areas for the promotion of regional development are 
eligible for the benefits provided under the Code, except for following industrial activities, which are no longer entitled to the benefits aimed at encouraging regional development: bakeries, pastry-making plants, stone quarries, manufacturing of miscellaneous condiments, preparation of 
chicory, coffee processing and roasting, and motion picture development and production 
(Decree No. 2002-1363 of 11 June 2002). 
The tax benefits mentioned in paragraph 5(a), (b), (c) and (d) are accorded directly by the 
relevant departments of the Ministry of Finance upon presentation of an investment declaration 
certificate. 
The capital grant and the grant by way of State participation in the cost of infrastructure necessary 
for the project, described in paragraph 5(e) an d (f) above, are made available by the State 
through the Industrial Promotion and Decent ralization Fund (FOPRODI), set up under 
Law No. 73-82 of 31 December 1973. 
Any company wishing to benefit from these incentives must submit an application supported by a 
project feasibility study. 
Applications are examined by a committee chaired by  a representative of the Ministry of Industry 
and made up of representatives from the departments concerned as well as a representative of the 
profession. 
The amounts of the grants are based on the inve stment project as approved by the Incentives 
Committee. Grants are made by decision of the Mi nister of Industry. The grants are disbursed in 
three instalments, as follows: 
 40% at project start-up; 
 40% upon completion of major infrastructure work; 
 20% when production begins. 
The benefit of State payment of employer contributions to the statutory social security scheme is 
granted by decision of the Minister of Social Affairs on the proposal of the above-mentioned 
Committee.  
7. See Section 9 (Amounts of the incentives granted). 
8. See paragraph 5. 
10. The incentives accorded for the establishment of enterprises in regional development areas 
have no effect on trade. These incentives are given once only, at the time when the investment is 
made and not during the production phase. 
2  INCENTIVES FOR POLLUTION CONTROL AND ENVIRONMENTAL PROTECTION 1. The incentives for investment made by enterprises to combat pollution resulting from their 
activities or by enterprises specializing in waste and refuse collection, processing and treatment 
comprise tax rebates, investment grants and exemption from duties and taxes on capital goods. 
 2. This notification covers the period 2004-2006. 
 G/SCM/N/155/TUN 
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  3. These incentives are aimed at helping industrial enterprises introduce separate wastewater 
networks, make changes to manufacturing processe s, avoid wastage, reduce and recycle waste, 
recycle wastewater, use clean technology to  eliminate pollution including industrial 
pollution-problems at source, set up liquid and gaseous effluent pre-treatment units consistent with discharge standards, detoxi fy hazardous waste, and enhance the management of industrial 
waste through recovery or ecological elimination. 
 4. The legal texts governing pollution control incentives are the following: 
 
 Law No. 93-120 of 27 December 1993 enacting the Investment Incentives Code, as 
amended or supplemented by subsequent texts; 
 Law No. 92-122 of 29 December 1992 containing the Finance Law for the 1993 budget 
year and providing for the establishmen t of a Pollution Cleanup Fund (FODEP) 
(Articles 35 to 37), as amended or supplemented by subsequent texts; 
 Decree No. 93-2120 of 25 October 1993 setting out the procedures and conditions for 
FODEP support, as amended by Decree No. 2636 of 24 September 2005. 
5. The incentives granted for investment in pollution control and environmental protection are 
the following: 
 
a. exemption from customs duty and susp ension of VAT on capital goods; 
b. tax deduction on income or profits invested in or used to increase initial company 
capital, of up to 50% of income or profits subject to personal income tax or corporation 
tax; 
c. tax deduction of up to 50% of profits reinvested in the company; 
d. tax deduction of income or profits from these activities for personal income tax or 
corporation tax purposes; and 
e. a grant capped at 20% of the cost of the investment. The grant is made by FODEP, 
established by Law No. 92-122 of 29 December 1992. 
6. These benefits are accorded to all enterprises wishing to invest in pollution control and 
environmental protection. 
 Exemption from duties and charges on the equipm ent needed for the investment is granted by 
decision of the Minister of Finance, based on an opinion by the National Environmental 
Protection Agency (ANPE). 
 The tax benefits mentioned in paragraph 5(b), (c) and (d) are accorded directly by the relevant departments of the Ministry of Finance. 
 
State financial aid covering 20% of the cost of the investment is paid from FODEP funds. It is granted by decision of the Minister of the En vironment and Land-Use Planning, based on an 
opinion by the advisory panel responsible for awarding FODEP support. 
 
To be eligible for FODEP funding, the following conditions must be met:  
 presentation of a pollution certificate issued by the ANPE; 
 submission of a project study approved by the ANPE; 
 conclusion of a performance contract setting out the timetable for the operations to be 
carried out; and 
 an investment and financial plan involving at least 30% of equity assets. G/SCM/N/155/TUN 
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  FODEP support is targeted, being restricted to the transformation of existing facilities. 
 7. See Section 9 (Amounts of the incentives granted). 
 8. See paragraph 5. 
 
10. The incentives granted for investment in pollution clean-up programmes have no effect on trade.  
3  PROMOTION OF TECHNOLOGY, RESEARCH AND DEVELOPMENT AND ENERGY SAVING 
A. RESEARCH AND DEVELOPMENT 
 
1. The incentives provided for investment made by companies in research and development 
comprise tax rebates for investors, exemption from certain duties and charges, capital grants and State payment of certain infrastructure expenses and social security costs if young graduates are employed. 
2. This notification covers the period 2004-2006. 
3. These incentives fall under the national policy to promote industrial research and 
technological advancement. They are intended to  encourage research and development within the 
company, the acquisition of technological expertise and technological development to enhance productivity and foster relations between businesses and research centres. 
4. The legal texts governing incentives for research and development are as follows: 
 Law No. 93-120 of 27 December 1993 enacting the Investment Incentives Code, as 
amended or supplemented by subsequent texts; 
 Decree No. 94-536 of 10 March 1994 establishing the amount and procedures for 
according capital grants for investment in research and development activities by 
enterprises in the industrial, agricultural and fisheries sectors, as amended or supplemented by subsequent texts; 
 Decree No. 94-494 of 28 February 1994 setting out the procedures for State payment of 
employer contributions to the statutory social security scheme, as amended or 
supplemented by subsequent texts; 
 Decree No. 94-1191 of 30 May 1994 establishing the conditions of eligibility for the tax 
benefits provided for in Articles 37, 41, 42 and 49 of the Investment Incentives Code 
and granted for facilities for energy saving, research into, production and marketing of 
renewable energy and research into geotherm al energy, equipment for pollution control 
and waste collection, processing and treatment, and research and development facilities, as amended or supplemented by subsequent texts; 
 Decree No. 2005-1857 of 27 June 2005 establishing the modalities and procedures for 
implementing Article 43 bis (new) of the Investment Incentives Code. 
5. Investments in industrial research and development are entitled to: 
a. Exemption from customs duty and suspension of VAT and excise duty on purchases of 
capital goods needed for the investment; 
b. State payment of the following: 
(1) 50% of social security contributions over five years, for foreign personnel 
brought in to optimize production capacities and for Tunisian nationals holding 
certificates of higher education; 
 G/SCM/N/155/TUN 
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  (2) part of the employer's contribution for graduate recruitment, over seven years, 
as follows: 
- 100% the first and second years; 
- 85% the third year; - 70% the fourth year; 
- 55% the fifth year; 
- 40% the sixth year; and - 25% the seventh year. 
c. a capital grant for research and development activities representing 20% of the cost, up 
to a limit of TDN 100,000, of the creation and technical testing of prototypes, field 
experiments and the acquisition of scientific  laboratory equipment needed for research 
and development projects, and 30% of the cost, up to a limit of TDN 25,000, of original 
studies necessary for developing new products or processes. 
This grant is charged to the budget of the Ministry of Scientific Research and Skills Development. 
6. All investments in industrial activities aimed at promoting research and development and 
enterprise - research centre links are eligible for the benefits provided under the Code in respect of research and development. 
The tax benefits for the purchase of capital goods needed for research and development projects 
are granted to enterprises by decision of the Mi nister of Finance, based on an opinion by the 
committee attached to the Ministry of Finance.  
The capital grant for research and development mentioned in paragraph 5(c) is given by the 
Ministry of Higher Education and Technology on the basis of a performance contract setting out the investment and financing plan, a list of the equipment needed, a timetable for the operations to be carried out, the amount of the grant as well as the procedures for its disbursement and the 
undertakings given by the beneficiary enterprise. 
 The incentive of State payment of contributions to the statutory social security scheme mentioned in paragraph 5(b)(1) is accorded by decision of the Minister of Social Affairs, on the proposal of a 
committee chaired by the representative of the Ministry of Social Affairs. 
 State payment of contributions to the statutory scheme mentioned in paragraph 5(b)(2) is accorded by decision of the governor having geog raphical jurisdiction, based on the opinion of an 
advisory committee attached to the regional vocational training and employment offices. 
7. See Section 9 (Amounts of the incentives granted). 
8. See paragraph 5. 
10. The incentives granted for investment in rese arch and development have no effect on trade. 
B. PROMOTION OF TECHNOLOGY AND TECHNOLOGICAL EXPERTISE 
1. Incentives for investment made to promote technology and technological expertise take the 
form of direct financial assistance paid from the Industrial Competitiveness Development Fund (FODEC) and payment by the State of human resource training costs. 
2. This notification covers the period 2004-2006. 
3. The objective of the aid is to help industrial companies to finance the acquisition of 
technology and technological expertise in order to increase their local content and boost productivity. G/SCM/N/155/TUN 
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  4. The legal texts governing incentives for the promotion of technology and technological 
expertise are as follows: 
 Law No. 93-120 of 27 December 1993 enacting the Investment Incentives Code, as 
amended or supplemented by subsequent texts; 
 Law No. 90-111 of 31 December 1990 containing the Finance Law for the 1991 budget 
year, as amended or supplemented by subsequent texts; 
 Decree No. 94-540 of 10 March 1994 establishing the conditions and procedures for 
benefiting from State payment of human resource training costs in connection with investment in technology, as amended or supplemented by subsequent texts; 
 Decree No. 99-2741 of 6 December 1999 establishing the rules governing the 
organization, working and operating procedures of the FODEC, as amended or supplemented by the relevant texts. 
5. The incentives granted for investment made to promote technology and technological 
expertise include: 
a. financial assistance paid out of FODEC funds; 
b. payment by the State of 50% of the cost of human resource training in connection with 
technological investment, up to a ceiling of TDN 125,000. 
Training expenses include registration fees, transport and accommodation costs and other 
training-related outlays. They are paid from th e budgeted funding of the Ministry of Employment 
and Professional Integration of Youth. 
6. All industrial enterprises may benefit from FODEC assistance, which is granted by decision of 
the Minister of Industry, Energy and Small and Medium-Sized Enterprises, based on a study and 
report by an advisory committee. 
As regards payment of human resource training costs, any enterprise wishing to benefit from this 
measure must submit to the National Centre for Continuing Education and Vocational 
Advancement a training plan along the lines of a model drawn up by the relevant departments in 
the Ministry of Employment and Professional Integration of Youth. 
7. See Section 9 (Amounts of the incentives granted). 
8. See paragraph 5. 
10. Incentives granted for investment made to promote technology and technological expertise 
have no effect on trade. 
C. ENERGY SAVING 
1. Incentives accorded to enterprises making energy-saving investments take the form of 
exemption from duties and taxes on capital goods and financial assistance from the 
National Energy Management Agency (ANME). 
2. This notification covers the period 2004-2006. 
3. These incentives come under the national programme for the management of energy 
consumption designed to prepare for the post-petroleum phase when Tunisia will have an energy 
deficit. They are meant to encourage companies to make energy savings, and conduct research 
into and develop renewable sources of energy as well as geothermal energy. G/SCM/N/155/TUN 
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  4. The legal texts governing incentives for energy saving are as follows: 
 Law No. 93-120 of 27 December 1993 enacting the Investment Incentives Code, as 
amended or supplemented by subsequent texts; 
 Law No. 2005-82 of 15 August 2005 establishing an energy management system; 
 Law No. 2005-106 of 19 December 2005 containing the Finance Law for 2006 
(Articles 12 and 13 establishing the National Fund for Energy Management); 
 Decree No. 2005-2234 of 22 August 2005 setting the rates and amounts of capital 
grants made for measures falling under the energy management regime and the criteria and procedures for awarding them; 
 Decree No. 94-1191 of 30 May 1994 establishing the conditions of eligibility for the tax 
benefits provided for in Articles 37, 41, 42 and 49 of the Investment Incentives Code 
and granted for facilities for energy saving, research into, production and marketing of renewable energy and research into geotherm al energy, equipment for pollution control 
and waste collection, processing and treatment, and research and development facilities, 
as amended or supplemented by subsequent texts. 
5. Investment incentives in the field of ener gy management take the following forms: 
a. exemption from customs duty and reduction to 12% of VAT on purchases of capital 
goods needed for the investment; 
b. a specific grant for energy management projects, including those relating to renewable 
and geothermal energy; this grant covers: 
(1) energy audits, performance contracts and prior consultation: 
- 50% of the cost of energy audits, up to a ceiling of TND 20,000; 
- 50% of the cost of demonstration projects, up to a ceiling of TND 100,000; - 20% of the cost of investment in energy  management projects, up to a ceiling of: 
 TND 100,000 for establishments whose to tal average annual energy consumption 
does not exceed 4,000 tonnes of oil equivalent (TOE); 
 TND 200,000 for establishments whose av erage total annual energy consumption 
ranges between 4,000 and 7,000 tonnes TOE; 
 TND 250,000 for establishments whose av erage total annual energy consumption 
exceeds 7,000 tonnes TOE. 
(2) the setting up of vehicle engine test units: 20% of the cost of the investment, up 
to a ceiling of TND 6,000; 
(3) solar-powered water heating in the residential and private business sectors: 20% 
of the cost of solar collectors, up to a ceiling of TND 100 per m2; 
(4) the energy switch to natural gas in th e industrial sector: 20% of the cost of 
internal connection and conversion of equipment, up to a ceiling of TND 400,000; 
(5) the energy switch to natural gas in th e residential sector: TND 140 for individual 
homes and TND 20 per unit in apartment buildings. 
6. All industrial enterprises wishing to make energy-saving investments are eligible for the 
incentives mentioned in paragraph 5. 
Tax benefits for the purchase of capital goods needed for research and development projects are 
accorded to enterprises by decision of the Mini ster of Finance, based on the opinion of the 
Technical Committee attached to the Ministry of Finance.  The specific grant is accorded by decision of the Minister of Industry, Energy and Small and 
Medium-Sized Enterprises, based on an opinion by the committee chaired by the managing G/SCM/N/155/TUN 
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  director of the ANME. It is provided under a performance contract between the ANME and the 
enterprise concerned, setting out all the technical, economic and financial aspects of the i n v e s t m e n t  p r o j e c t ,  a s  w e l l  a s  t h e  a m o u n t  o f  t h e aid granted, the eligibility conditions and the 
procedures for its disbursement. 
7. See Section 9 (Amounts of the incentives granted). 
8. See paragraph 5. 
10. The grants given for investments in energy-saving projects have no effect on trade. 4  ENCOURAGEMENT OF NEW ENTREPRENEURS, LIGHT INDUSTRIES AND SMALL AND 
MEDIUM-SIZED ENTERPRISES 
A. NEW ENTREPRENEURS 
1. Incentives for new entrepreneurs comprise capital grants, grants by way of State 
participation in the cost of studies, technical assistance fees and expenses relating to the 
acquisition of serviced sites or premises necessary to the implementation of industrial projects, 
and equity participation. 
Those considered as new entrepreneurs include natural persons of Tunisian nationality, whether or 
not grouped together in a company, undertaking their first investment project, managing and 
taking responsibility for the project personally on a full-time basis and having the requisite 
experience and qualifications, but insufficient capital of their own. 
2. This notification covers the period 2004-2006. 
3. These incentives are designed to encourage th e creation of micro, small and medium-sized 
enterprises, foster the spirit of private enterprise, combat unemployment and encourage the 
renewal of the production apparatus. 
4. The legal texts governing these incentives are as follows: 
 Law No. 93-120 of 27 December 1993 enacting the Investment Incentives Code, as 
amended or supplemented by subsequent texts; 
 Law No. 73-82 of 31 December 1973 containing the Finance Law for the 1974 budget 
year and establishing the Industrial Promotion and Decentralization Fund (FOPRODI), as amended or supplemented by subsequent texts; 
 Decree No. 94-538 of 10 March 1994 granting investment incentives to new 
entrepreneurs, as amended or supplemented by subsequent texts, and in particular by Decrees Nos. 99-482 and 99-483 of 1 March 1999 delimiting regional development areas; 
 Decree No. 94-494 of 28 February 1994 setting out the procedures for State payment of 
employer contributions to the statutory social security scheme, as amended or 
supplemented by subsequent texts. 
5. New entrepreneurs who make investments in industry not exceeding a total cost of 
TND 3 million may receive the following benefits: 
a. a capital grant of 10% of the cost of the equipment, up to a ceiling of TND 100,000; 
b. a State grant towards defraying the cost of the project study; this grant is set at 70% of 
these expenses, up to a ceiling of TND 20,000; 
c. a minimum equity participation granted for manufacturing and services sector projects 
on the following basis: G/SCM/N/155/TUN 
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  (1) For the first part of the investment and up to TND 1 million, FOPRODI's share in 
the equity may not exceed 60% of the minimum equity, and the investor must guarantee personal input of at least 10% of the equity and a contribution from a 
risk capital investment company; 
 
(2) for the balance of the investment and up to TND 4 million, FOPRODI's share in the 
equity is limited to 30% of the additional minimum equity, and the investor must guarantee personal input of at least 20% of the equity and a contribution from a 
risk capital investment company. 
d. State payment of one third of the price of the land or premises required for the project, 
up to a ceiling of TND 30,000. 
In all instances, the participation paid from FOPRODI funds corresponds to that of the risk capital 
investment company. 
6. The capital grants and loans mentioned in para graph 5 are made available by the Industrial 
Promotion and Decentralization Fund (FOPRODI) for industrial projects, following examination and a study by the technical committee and on the basis of a project feasibility study. 
The incentive of State payment of employer contributions to the statutory social security scheme is 
accorded by decision of the Minister of Social Af fairs on the proposal of a committee chaired by the 
representative of the Ministry of Industry, En ergy and Small and Medium-Sized Enterprises. 
7. See Section 9 (Amounts of the incentives granted). 
8. See paragraph 5. 
10. The grants given for investments by new entr epreneurs have no effect on trade, as the 
incentives are given upon establishment of the en terprise and not during the production phase. 
B. LIGHT INDUSTRY AND CRAFTS AND TRADES 
1. Incentives for light industry and crafts and trad es take the form of equity participation and a 
grant by way of State participation in the cost of studies and technical assistance. 
2. This notification covers the period 2004-2006. 
3. Incentives for investment in crafts and trades and light industries come under the strategy 
launched over ten years ago to promote craft proj ects and encourage the trades, considering their 
impact on employment. 
4. The legal texts governing these incentives are as follows: 
 Law No. 81-76 of 9 August 1981 creating the National Fund for the Promotion of Crafts 
and Trades and Light Industries (FONAPRAM), as amended by Law No. 86-106 of 
31 December 1986 containing the Finance Law for the 1987 budget year; 
 Law No. 93-120 of 27 December 1993 enacting the Investment Incentives Code, as 
amended or supplemented subsequent texts; 
 Decree No. 94-814 of 11 April 1994 defining small businesses, establishing their spheres 
of activity and the criteria and procedures for granting the benefits for which they are 
eligible, as amended or supplemented by su bsequent texts, and in particular by 
Decree No. 96-1444 of 12 August 1996. G/SCM/N/155/TUN 
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  5. Light industries and crafts and trades engagi ng in the activities specified by decree are 
eligible for the following: 
a. capital loan not exceeding 90% of equity assets corresponding to the part of the 
investment up to TND 10,000 and 80% of equi ty assets of the part of the investment 
between TND 10,000 and TND 50,000. This sum is repayable free of interest over 
four years as of the eighth year; 
b. a capital grant of 6% of the total cost of the investment. 
This grant is increased to: 
(1) 21% for projects located in non-priority regional development areas; 
 
(2) 25% for projects located in priority regional development areas.  
Any person wishing to invest in the crafts and trad es or engage in any of the activities referred to 
in Decree No. 96-1444 of 12 August 1996 is entitled to the benefits listed in paragraph 5. 
6. The grants and equity participation mentioned in paragraph 1 are paid out of FONAPRAM 
funds, which are managed by banks. 
7. See Section 9 (Amounts of the incentives granted). 
8. See paragraph 5. 
10. The grants given to small and medium-sized enterprises have no effect on trade. C. ENCOURAGEMENT OF SMALL AND MEDIUM-SIZED ENTERPRISES 
1. Incentives for small and medium-sized enterprises take the form of equity participation and 
a grant by way of State participation in the cost of studies and technical assistance. 
2. This notification covers the period 2004-2006. 
4. The legal texts governing these incentives are as follows: 
 Law No. 93-120 of 27 December 1993 enacting the Investment Incentives Code, as 
amended or supplemented by subsequent texts; 
 Law No. 73-82 of 31 December 1973 containing the Finance Law for the 1974 budget 
year and establishing the Industrial Promotion and Decentralization Fund (FOPRODI), as amended or supplemented by subsequent texts; 
 Decree No. 99-484 of 1 March 1999 granting incentives to small and medium-sized 
enterprises, as amended or supplemented by subsequent texts. 
5. Small and medium-sized enterprises are eligible for the following support from FOPRODI: 
a. minimum equity participation in accordance with the following criteria: 
(1) For the first part of the investment and up to TND 1 million, FOPRODI's share may 
not exceed 30% of the minimum equity; 
 (2) for the balance of the investment and up to TND 3 million, FOPRODI's share may 
not exceed 10% of the additional minimum capital; 
 
b. a studies and technical assistance grant representing 70% of the total cost, up to a 
ceiling of TND 20,000. G/SCM/N/155/TUN 
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  6. Incentives for small and medium-sized enterprises take the form of equity participation and 
a grant by way of State participation in the cost of studies and technical assistance. 
7. See Section 9 (Amounts of the incentives granted). 
8. See paragraph 5. 
10. The incentives granted to encourage small and medium-sized enterprises have no effect on 
trade. These incentives are given once only, at the time when the investment is made and not 
during the production phase. 
5  EXPORT PROMOTION 
1. The benefits accorded to export enterprises take the form of tax rebates for investors in 
equity and for the enterprise when it ploughs back equity. 
2. This notification covers the period 2004-2006. 
3. The system of wholly export-oriented enterprises was established in 1972 in order to attract 
foreign direct investment and create jobs for an expanding labour force. 
It was prolonged by Law No. 93-120 of 27 December 1993, and affects all foreign or domestic 
investment in export processing zones. A partial export regime has also been established to benefit companies exporting part of their output. 
The incentives granted to wholly or partially expo rt-oriented enterprises are intended to build up 
export production capacity to meet international standards. 
4. These incentives are provided for in Law No. 93-120 of 27 December 1993 enacting the 
Investment Incentives Code, as amended and supplemented by subsequent texts, and in particular by Law No. 2002-101 of 17 December 2002 containing the Finance Law for the 2003 budget year. 
5. Total export regime : 
Wholly export-oriented enterprises may apply for full tax deduction of income or profits derived 
from exports, for corporation or personal income tax purposes, for a period of ten years as from the first export operation. This deduction is reduced to 50% as of the 11
th year for an indefinite 
period. 
Article 29 of Law No. 2002-101 of 17 December 2002 extends the time-limit for full deduction of 
income and profits derived from exports. Full deduction of income and profits from exports 
continues to apply, under the tax legislation in fo rce, to export-oriented enterprises for which the 
period of full deduction of income and profits from exports expires before 2007, in respect of 
income and profits made up to 31 December 2007. 
Partial export regime : 
Enterprises engaging in export operations under the partial export regime receive the following 
benefits: 
a.   suspension of VAT payable on imports into the home market of capital goods and raw 
materials needed for production; 
b.   full tax deduction of income and profits from  exports for a period of ten years. After this 
period, the deduction is reduced to 50%. 
Article 29 of Law No. 2002-101 of 17 December 2002 extends the time-limit for full deduction of 
income and profits derived from exports. Full deduction of income and profits from exports 
continues to apply, under the tax legislation in fo rce, to export-oriented enterprises for which the G/SCM/N/155/TUN 
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  period of full deduction of income and profits from exports expires before 2007, in respect of 
income and profits made up to 31 December 2007. 
6. All enterprises producing exclusively or partially for export are eligible for the benefits 
envisaged in the Investment Incentives Code. 
7. See Section 9 (Amounts of the incentives granted). 
8. See paragraph 5. 
10. These benefits have no effect on trade. 
 6  OTHER ADVANTAGES GRANTED UNDER LAW NO. 93-120 OF 27 DECEMBER 1993 
ENACTING THE INVESTME NT INCENTIVES CODE 
1. Tax and financial benefits may be accorded to investments of particular importance or 
interest to the national economy or for the development of border areas. 
Additional incentives and benefits may be granted for investments in the areas of education, 
higher education, including university housing, vocational training and investments relating to preparatory years. 
2. This notification covers the period 2004-2006. 
3. These benefits are designed to foster the creation of enterprises in pursuit of the objectives 
of the economic and social development prog rammes laid down in the five-year plan. 
4. These incentives are provided for in Law No. 93-120 of 27 December 1993 enacting the 
Investment Incentives Code, as amended or supplemented by subsequent texts, and in particular 
by Law No. 99-101 of 31 December 1999 containing the Finance Law for the year 2000 and by 
Law No. 2001-82 of 24 July 2001. 
5. and 6. The benefits are accorded by decree,  based on the opinion of the High-level 
Investment Committee, in the form of: 
a. income or corporation tax exem ption for up to five years; 
b. a State contribution towards the cost of infrastructure; 
c. a capital grant not exceeding 5% of the amount invested; the grant may be as high as 
20% for projects involving promising activities; 
d. suspension of duties and taxes on the purchase of capital goods needed for the 
purposes of investment. 
For investments in the areas of education, higher education, including university housing, 
vocational training and investments relating to pr eparatory years, the benefits are accorded in the 
form of: 
 a capital grant not exceeding 25% of the cost of the project; 
 State payment of part of the salaries paid to Tunisian teaching or training personnel 
recruited on a permanent basis, up to a limit of 25% and for a period not exceeding ten years; 
 State payment of employer contributions to the statutory social security scheme in 
respect of salaries paid to Tunisian teaching or training personnel recruited on a permanent basis, up to a limit of 25% and for a period not exceeding ten years; G/SCM/N/155/TUN 
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   State payment of employer contributions to the statutory social security scheme in 
respect of salaries paid to Tunisian teaching or training personnel recruited on a permanent basis for a period of five years, which may be extended once only for an equal length of time; 
 provision of land for investors under concession agreements in accordance with the 
legislation in force. 
7. See Section 9 (Amounts of the incentives granted). 8. See paragraph 5. 10. These benefits have no effect on trade. 
 
7  NATIONAL UPGRADING PROGRAMME 
1. The national upgrading programme initiated in 1996 provides financial assistance to 
industrial companies carrying out restructuring. Such restructuring includes: 
a. physical investments, in particular investments in the technical and technological 
modernization of the production process, conversion in order to adapt to markets and improvement of company competitiveness; 
b. intangible investments, in particular those covering diagnostic studies prior to the 
upgrading and those fostering greater company competitiveness. 
2. This notification covers the period 2004-2006. 
3. The opening up of the economy and the esta blishment of a free-trade area with the 
European Union calls for upgrading of the industrial sector by setting up a programme and 
structures for modernizing the economy and strengthening the capacities of firms to adapt to the 
demands of the international market. 
Upgrading entails a package of actions within the company and its environment. It therefore 
affects aspects such as technology, organization, financial balance, vocational training, etc. 
With regard to the company's environment, u pgrading affects basic infrastructure, support 
structures and the range of production and service entities related to the industry. 
Initial cost estimates for the first phase of this programme (1996-2000) stand at around 
TND 2.5 billion, 60% of which is allocated for u pgrading and modernizing enterprises and 40% for 
upgrading and reinforcing their infrastructural environment. 
The programme is financed by both the enterprises and the financial sector. State aid 
complements market mechanisms and is designed to foster and support efforts by enterprises, in view of the cost of the operation. 
4. State aid is financed from the Industrial Competitiveness Development Fund (FODEC), 
established by Law No. 94-127 of 26 December 1994 containing the Finance Law for the 1995 budget year. 
The organization, working and operating proc edures of the FODEC are laid down in 
Decree No. 99-2741 of 6 December 1999 establis hing the rules governing the organization, 
working and operating procedures of the FODEC,  as amended and supplemented by subsequent 
texts. 
5. State aid takes the form of capital grants set as follows: 
a. Physical investments: G/SCM/N/155/TUN 
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  (1)  20% of physical investments financed from equity assets; 
(2) 10% of investments financed with other resources; (3) 50% of the cost of priority equipment purc hased in the context of upgrading, up to a 
ceiling of TDN 100,000; 
b. Intangible investments: 
(1)  70% of the cost of diagnostic studies preliminary to upgrading, up to a ceiling of 
TDN 30,000; 
(2)  70% of the cost of any other non-tangible investment designed to improve the 
company's competitiveness. 
6. The upgrading programme covers private-sector industrial enterprises and industry-related 
service companies, regardless of size, category or location. 
State aid is granted by decision of the Minister of Industry, based on an opinion by the steering 
committee of the upgrading programme. To that end, an agreement is concluded between the 
Ministry of Industry and the enterprise, setting ou t the rights and duties of each of the parties. 
 7. See Section 9 (Amounts of the incentives granted). 
8. See paragraph 5. 
10. The upgrading programme has no direct effect on trade. 
8  INDUSTRIAL COMPETITIVENESS DEVELOPMENT FUND (FODEC) 1. The Industrial Competitiveness Development Fund provides funding for programmes to 
enhance the quality of industrial products, industrial restructuring processes and strategic sectoral 
studies. 
2. This notification covers the period 2004-2006. 
3. FODEC financial support is designed to enha nce the quality of industrial products and 
industrial restructuring processes. 
4. The FODEC was established by Law No. 94-127 of 26 December 1994 containing the Finance 
Law for the 1995 budget year. 
The operation of the Fund was determined by Decree No. 99-2741 of 6 December 1999 
establishing the rules governing the organization, working and operating procedures of the FODEC, 
as amended and supplemented by subsequent texts. 
5. FODEC funding takes the following forms: 
a. financial assistance of up to 50% of the cost of priority equipment, up to a ceiling of TND 
100,000 for each enterprise; 
b. financial assistance of up to 70% of the cost of isolated, intangible and priority 
investments, up to a ceiling of TND 70,000 for each enterprise; 
c. financial assistance of up to 70% of the cost of diagnostic studies prior to the 
restructuring of enterprises in financial difficulties, up to a ceiling of TND 30,000. 
The funding is granted by decision  of the Minister of Industry. 
 6. FODEC support is intended for private-sector industrial enterprises and industry-related 
service companies. 
7. See Section 9 (Amounts of the incentives granted). G/SCM/N/155/TUN 
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  8. See paragraph 5. 
10. The FODEC has no direct effect on trade. 9  AMOUNTS OF THE INCENTIVES GRANTED, 2004-2006 The following is a breakdown of the amounts of the incentives accorded to enterprises for the 
period 2004-2006: 
1. Tax incentives for all categories of investment: 
-  Corporation tax: 
 2004: TND 298.722 million; 
 2005: TDN 392.709 million; 
 2006: TDN 340.602 million. 
-  Personal income tax: 
 2004: TDN 12.674 million; 
 2005: TDN 13.000 million; 
 2006: TDN 13.000 million. 
-  Suspension of duties and taxes on capital goods purchases: 
 2004: TDN 6.489 million; 
 2005: TDN 8.567 million; 
 2006: TDN 9.868 million. 
2. Financial incentives for all categories of investment: 
a. Industrial capital grants: 
-  Agriculture: 
 2004: TDN 68.900 million; 
 2005: TDN 73.800 million; 
 2006: TDN 62.300 million. 
-  Pollution control: 
 2004: TDN 2.18 million; 
 2005: TDN 1.77 million; 
 2006: TDN 0.84 million. 
-  Industrial Competitiveness Development Fund (FODEC): 
 2004: TDN 29.3 million; G/SCM/N/155/TUN 
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   2005: TDN 43.8 million; 
 2006: TDN 43.5 million. 
b. Contribution to the cost of basic infrastructure: 
 2004: TDN 2.29 million; 
 2005: TDN 2.04 million; 
 2006: TDN 1.95 million. 
c. State payment of employer contributions to the statutory social security scheme: 
 2004: TDN 17.90 million; 
 2005: TDN 21 million; 
 2006: TDN 22.21 million. 
d. Export promotion (FOPRODEX): 
 2004: TDN 15.84 million; 
 2005: TDN 14.27 million; 
 2006: TDN 14.13 million. 
e. Fund for the Development of Competitiveness in the Agricultural and Fisheries Sectors 
(FODECAP): 
 2004: TDN 21.153 million; 
 2005: TDN 21.683 million; 
 2006: TDN 23.418 million. 
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