G/SCM/N/253/ATG  
G/SCM/N/260/ATG  
 
31 July 2013  
(13-4116)  Page: 1/8  
Committee on Subsidies and Countervailing Measures  Original: English  
 
 SUBSIDIES 
NEW AND FULL NOTIFICATION PURSUANT TO ARTICLE XVI:I OF 
THE GATT 1994 AND ARTICLE 25 OF THE AGREEMENT ON 
SUBSIDIES AND COUNTERVAILING MEASURES 
TRANSPARENCY NOTIFICATION CONCERNING THE EXTENSIONS PROVIDED FOR IN ARTICLE 27.4 
OF THE AGREEMENT ON SUBSIDIES AND COUN TERVAILING MEASURES OF THE TRANSITION 
PERIOD FOR THE ELIMINATION OF EXPORT  SUBSIDIES, GRANTED PURSUANT TO 
THE PROCEDURES IN THE GENERA L COUNCIL DECISION WT/L/691 
ANTIGUA AND BARBUDA  
The following communication dated 25 July 2013 is being circulated at the request of the 
Delegation of Antigua and Barbuda. 
 
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 Antigua and Barbuda hereby submits its new and full  notification pursuant to Article XVI:1 of the 
GATT 1994 and Article 25 of the SCM Agreement.  
 This notification also is submitted for purposes of transparency in the context of the extensions 
granted to Antigua and Barbuda under Article 27.4 of the SCM Agreement, pursuant to the 
procedures contained in the General Council Decision in document WT/L/691.   
 In accordance with the procedures contained in the General Council document concerning 
notification requirements of 2(a), Antigua and Barbuda wishes to inform that the Fiscal Incentives 
Act CAP 172 of 1975 have been repealed in advance of the two year phase out period, and in advance of the 2015 deadline. With respect to the Free Trade and Processing Zone Act No. 12 of 
1994, this is maintained and there continue to  be no beneficiaries under this programme. 
 Antigua and Barbuda wishes to reiterate that, in accordance with Article 25.7 of the SCM Agreement, this notification does  not prejudge either the legal st atus of the notified programmes 
under GATT 1994 or the SCM Agreement, the effects under the SCM Agreement, or the nature of 
the programmes themselves. Furthermore, notification of a programme or measure does not prejudice its actionable or non-actionable nature. 
 
Please be informed, that not all elements of the notified programmes, including subsidies provided hereunder, necessarily involve export subsidies. G/SCM/N/253/ATG • G/SCM/N/260/ATG 
 
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  PROGRAMMES 
PROGRAMME 1 
FISCAL INCENTIVES ACT CAP 172 (DECEMBER 1975) 
1. Description of the programme 
 
The Fiscal Incentives Act is an Act to provide incentives to industry, mobilize and direct capital for new investment, and attract foreign private investment and capital. 
 
2. Period covered by the notification 
 1 July 2011 - 30 June 2012 
 
3. Policy objective and/or purpose of the subsidy 
 
To attract private investors who will contribute to the desired expansion of national output, 
thereby promoting economic growth, developmen t and increased employment in a diversified 
economy. 
 
4. Background and authority for the subsidy 
 Background 
 
The promotion of private investment is an integr al part of the development plan of Antigua and 
Barbuda as we continue to diversify production  and reduce our reliance on tourism. Economic 
expansion generates demand for foreign exchange . Given our narrow resource base Antigua and 
Barbuda continues to need resource inflows and one of the best ways to achieve this is through direct foreign investment. 
 
The Fiscal Incentives Act was passed to give effect to an agreement on the harmonization of fiscal incentives to industry among CARICOM countries.  
Authority 
 Fiscal Incentives Act Cap 172, (December of 1975) 
 
5. Form of Subsidy 
 
The Fiscal Incentives Act provides relief from taxes in the following ways: 
 
 Waiver from Customs Duty and Consumption Tax on plant, equipment, machinery, spare 
parts, raw materials or components thereof, for between ten (10) to fifteen (15) years, 
dependent on which group of enterprise. This is also subject to the satisfaction of the 
Comptroller of Customs and Excise, that the above list is required for: 
 
 (a) Constructing, altering, reconstructing or  extending the approved enterprise, that is, 
an enterprise declared by Order of the Minister responsible for industry; or 
 
 (b) Equipping an enterprise for the purpos e of manufacturing an approved product, 
that is, a product declared by Order of  the Minister responsible for industry. 
 
 Complete or partial exemption from the payment of income tax on profits on the profits 
arising from the sale of an approved product from the production day for a period not 
exceeding the time given to the Enterprise, that is 10 – 15 years. 
 
 Where shareholders or their nominees are not resident in Antigua and Barbuda, they shall 
be exempted from income tax on dividends, in respect of the amount of tax that exceeds the tax liability of the shareholder in his country of residence. G/SCM/N/253/ATG • G/SCM/N/260/ATG 
 
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   Where the export profits amount to ten (10) pe r cent or more of the entire profits of an 
enterprise, from the export of an approved pr oduct, relief shall be granted from income 
tax on the export profits. This relief is granted by way of tax credits. 
 
6. To whom and how the subsidy is provided 
 
Fiscal incentives are granted to private investors both foreign and local to facilitate the 
development of industries, in particular manufacturing, agro- processing, and agriculture, as it 
pertains to this notification.  An application is made to the Minister responsible for industry, by or on behalf of the enterprise, 
stating: 
 
 The locality or proposed locality of the factory; 
 The construction day; 
 The production day; 
 The approved product already being manufactured or intended to be manufactured; and 
 All information relevant to determine the local value added. 
 If the Minister is satisfied that it is in the public interest to grant such enterprise incentives, he may by Order published in the Gazette declare the enterprise to be an approved enterprise with 
effect from the date specified in the Order. 
 The relief from taxes, or "tax holiday period", is  granted on import duties, income tax and export 
profits, depending on the group in which the enterprise is categorized. 
 There are five groups of enterprises and th e tax holiday applicable is as follows: 
 
 Group I Enterprise, one in which the local value added is at least fifty per cent (50%) of 
the amount realized from the sale of an approved product; up to 15 years relief; 
 Group II Enterprise, one in which the local value added is between 25 per cent and 50 per 
cent, up to 12 years; 
 Group III Enterprise, one in which the local value added is between 10 per cent and 25 per 
cent, up to 10 years; 
 Enclave Enterprise, one in which production is exclusively for export; up to 15 years; and 
 Highly capital intensive industry, one in which the capital investment is not less than 
US$25 million, up to 15 years. 
 
Note:  the definition of local value added is th e amount realized from the sales of the product 
over a continuous period of twelve (12) months, minus the following: 
 
 1. Cost of imported raw materials, components, parts of components, fuels, and 
services; 
 2. Wages and salaries paid to nationals of Caricom Member States; 
 3. Profit and dividends distributed to foreign nationals; 
 4. Interest, management charges and other income payment to non-residents (including 
companies); and 
 5. Depreciation of imports of plant, machinery and equipment. 
 The local value added is weighted by the wages or salaries paid to nationals of a Member State of 
Caricom expressed as percentage of the total sa les of the approved product and calculated in 
accordance with the formula: 
  V (100 + W) 
 100  V represents the local value added expressed as a percentage of the total sales of the approved 
product; and 
 W represents the wages and salaries paid to nationals of a Member State expressed as a percentage of the total sales of the approved product.  G/SCM/N/253/ATG • G/SCM/N/260/ATG 
 
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  The Fiscal Incentives Act provides non-fiscal incentives to companies with a rebate for a portion of 
their income tax based on their export profits as a percentage of total profits. All Enterprises (Group I, II, II, Enclave, and Highly Capitalized Enterprises) are eligible for the rebate. However, 
eligibility does not occur until the tax holiday period is over. Rebate is only good for an additional 
five years. The schedule is as shown in the Table below: 
 Rebate on income tax based on export profits 
 
Export profits as a pe rcentage of tax on 
total profits Rebate of income tax as a percentage of 
tax on export profits 
10 – 20 25 
21 – 40 35 
41 – 60 45 
61 – 100 50 
 
7.  Subsidy per unit 
 As of 1 September 2004, approximately 35 firms are registered under the Fiscal Incentive Act. Below is the breakdown of the Sectors/Firms and Sales: 
 
Sectors Firms/Companies Sales (US$) 
Beverages 2 11,810,461 
Condiments 3 160,000 
Detergent 2 1,500,000 
Garments 6 1,200,000 
Light industries 3 8,237,464 
Other 19 2,4399,000 
 
8. Duration of subsidy and/or any other time limits attached to it, including date of 
inception/commencement 
 This programme was set up in 1975. This subsidy programme is applicable for ten (10) years. 
 
9.  Statistical data on the impact of the programme 
 
Merchandise Imports/Exports (US$ Millions)* 
 
 2000 2001 2002* 2003* 2004* 2005* 
Export 16.52 17.27 17.62 18.36 19.35 20.42 
Imports 342.09 317.29 324.71 350.51 369.55 371.22 
 
Source: Ministry of Finance, Economic Policy Unit 
 
*These are estimations/projections 
 
Note: These are the actual trade data for Antigu a and Barbuda, and not trade affected by this 
programme. 
 
Description of the domestic procedures necessary to eliminate export subsidies 
 
Antigua and Barbuda wishes to inform that amendments in this area are on-going and will be 
advanced by the two year phase out and will certainly be completed by the 2015 deadline.  G/SCM/N/253/ATG • G/SCM/N/260/ATG 
 
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PROGRAMME 2 
FREE TRADE AND PROCESSING ZONE ACT NO. 12 OF 1994   
1. Description of the programme 
 
Free Trade and Processing Zone Act is an Act to attract foreign and local private investment and capital for various Manufacturing and Service entities. 
 
2. Period covered by the notification 
 1 July 2011 - 30 June 2012 
 
3. Policy objective and/ or purpose of the subsidy 
 
To attract private investors who will contribute to the growth and development of the informatics 
and telecommunications related services. In addition, to attract investment in Pharmaceutical and other light manufacturing industries. 
 
4. Background and authority for the subsidy 
 Background 
 
The promotion of private investment is an integr al part of the development plan of Antigua and 
Barbuda as we continue to diversify production and reduce our reliance on tourism and promote 
establishment of certain manufacturing and services entities in Antigua and Barbuda.  
 Authority 
 
Free Trade and Processing Zone Act Cap No. of 1994.  5. Form of Subsidy 
 The Free Trade and processing Zone Act provid es relief from taxes in the following ways: 
 
(a) Exemption from the payment of Custom Duty, Consumption and other taxes on 
the importation of machinery, equipment, spare parts, and construction materials and other items needed to construct and operate facilities within the FTPZ; 
 
(b) Exemption from the payment of Custom Duty, Consumption and other taxes on 
the importation of raw materials and other goods to be incorporated in the products produced or assembled within the FTPZ; 
 
(c) Exemption from the payment of income and other taxes of any kind other than 
Social Security, Medical Benefits and the Education Levy on the earnings accruing 
to any person by virtue of accruing to any persons by virtue of carrying on his/her 
employment in any industrial or co mmercial activity within the FTPZ; 
 
(d) Exemption from the payment of export taxes or levies on the exportation from the 
FTPZ to any place outside of Antigua an d Barbuda of any goods, or articles 
produced or manufactured in the FTPZ;  
 
(e) Exemption from the payment of taxes of any kind on the repatriation of profits 
earned in the Zone; and 
 
(f) Exemption from the payment of taxes or  levies imposed by the Government in 
respect of any Industrial or Commercial activity being carried out within the FTPZ. 
 
In order to obtain a licence to operate in the FTPZ, an application must be submitted on the 
prescribed Form to the Commissioner. The Commissioner will submit this application to the Commission for examination and approval. G/SCM/N/253/ATG • G/SCM/N/260/ATG 
 
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  The decision to grant a licence is based on a number of considerations: 
  1. The level of investment;  
 2. Employment generation capacity of the project; 
  3. Foreign exchange generation of the project; 
 
 4. Technological adaptability and transfer possibilities; and    5. Environmental impact.  
 
The Licence fee ranges between US$10,000 and US$20,000 and is not dependant on the size of 
the project. 
 
6. To whom and how the subsidy is provided 
 
Incentives to operate an entity in the Free Tr ade and Processing Zone are granted to private 
investors both foreign and local to facilitate the development of industries, in particular certain manufacturing and services entities.  
7.  Subsidy per unit 
 
No statistical information is available since the first entity was not granted a licence to 
manufacture in the FTPZ until the last quarter of 2001. Presently, the factory is still under 
construction and the company does not plan to be  in operation until the first quarter of 2005. 
 
8. Duration of Subsidy 
 
The programme was set up in 1994. However, the first licence granted to a manufacturing entity to operate in the FTPZ was not issued until the last quarter of 2001.  
 
9. Statistical data on the impact of the Programme  
 
Merchandise Imports/Exports (US$ Millions) * 
 
 2000 2001 2002* 2003* 2004* 2005* 
Export 16.52 17.27 17.62 18.36 19.35 20.42 
Imports 342.09 317.29 324.71 350.51 369.55 371.22 
 
Source: Ministry of Finance, Economic Policy Unit 
 
 *These are estimations/projections 
 Note: These are the actual trade data for Antigua and Barbuda, and not trade affected by this 
programme.    As noted above, the first licence granted to a manufacturing entity to operate in the Free 
Trade and Processing Zone was not issued until the last quarter of 2001.  
 Description of the domestic procedures necessary to eliminate export subsidies 
 
Antigua and Barbuda wishes to inform that amendments in this area are on-going and will be 
advanced by the two year phase out and will certainly be completed by the 2015 deadline.  
 
 G/SCM/N/253/ATG • G/SCM/N/260/ATG 
 
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  CHAPTER 172 
THE FISCAL INCENTIVES ACT 
 
Arrangement of Sections 
 
Section  
1. Short title. 
 
PART I 
 
PRELIMINARY 
 2. Interpretation. 
3. Computation of local value added. 
4. Determination of value of content. 5. Non-resident. 
6. Declaration of approved product. 
7. Declaration of approved enterprise. 8. Applications for approval. 9. Objections to proposals to approve a product or enterprise. 
10. Cabinet and Minister to have absolute discretion in respect of approval. 
11. Classification of enterprises. 12. Benefits for enterprise engaged in highly capital intensive industry. 
 
PART II 
 
PROVISION RELATING TO INCOME TAX 
 13. Exemption from income tax. 14. Depreciation allowance. 
15. Deduction for capital expenditure. 
16. Set-off. 17. Losses carried forward for purpose of set-off. 
18. Export allowance may be granted: 
19. Dividends. 20. Interest. 
 
PART III 
 
PROVISIONS RELATING TO CUSTOMS DUTY 
 
21. Licence to import. 22. Record and inspection of articles. 
23. Restriction on disposal of articles. 
 
PART IV 
 
MISCELLANEOUS 
 24. Delay of construction or manufacture. 
25. Revocation of order. 
26. Restriction on use of factory. 27. Appraisal of performance of enterprise. 
28. Transfer of status of approved enterprise. 
29. Regulations. 30. Publication in Gazette. 
31. Savings. 
   G/SCM/N/253/ATG • G/SCM/N/260/ATG 
 
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  THE FREE TRADE AND PROCESSING ZONE 
AREA ACT, 1994 
 
Arrangement of Sections 
 
Section  
1. Short title. 
2. Interpretation. 3. Establishment of Commission.  4. Seal and procedure for sealing documents. 
5. Acquisition of land for free trade and processing zone. 
6. Declaration of a free trade and processing zone. 7. Functions and powers of the Commission. 
8. Composition and administ ration of the Commission. 
9. Meetings and procedures of the Commission. 10. Appointment and duties of Commissioner. 
11. Procedure for application and grant of licence. 
12. Licences. 13. Commission not to approve unlawful activity. 14. Incentives to licensed industries. 
15. Conditions for employment in free trade and processing zone. 
16. Licensee to comply with the Act or Regulation etc. 17. Environmental protection. 
18. Movement of goods in and out of free trade and processing zone. 
19. Establishment of customs post in free trade and processing zone. 20. Commission to charge royalties. 
21. Investments. 
22. Reserve fund. 23. Accounts and audit. 24. Law and legal proceedings. 
25. Preservation of secrecy and nondisclosure of information to unauthorized person. 
26. Annual Report. 27. Regulation. 
 
 
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