G/SCM/N/315/DOM  
25 May 2018 
(18-3139) Page: 1/6 
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 SUBSIDIES AND COUNTERVAILING MEASURES  
DOMINICAN REPUBLIC  
The following communication, dated 20 April 2 018, is being circulated at the request of  the 
delegation  of the Dominican Republic . 
 
_______________  
 
 
In accordance with the format of the questionnaire in document G/SCM/6, prepared and adopted 
by the Committ ee 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 , located within geographic areas known as free zones . 
 
2. Period covered by the notification  
 
This notification covers the period up to 31 December 2 017. 
 
3. Policy objective and/or purpose of the subsidy  
 
The objectives of the programme are, inter alia , job creation, workforce training, development of 
social responsibility programmes , promotion of ba lance-of-payments equilibrium (foreign exchange 
generation) and establishment of regional economic and social 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 1 5 January 1 990. 
 
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 f rom payment of income tax and customs duties on the importation and exportation of the 
raw materials, equipment and machinery used to produce these goods . The subsidy is therefore 
a tax concession . 
 G/SCM/N/315/DOM  
- 2 - 
  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 eligible under the free -zone regime established 
by Law No. 8-90 from the taxes and duties specified in point  5 of th is 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 subsid y 
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 co nducted 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 time -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 Hait i and 15 years in 
the rest of the country . Beyond this period, permit holders may apply for a renewal . 
 
9. Statistical data permitting an assessment of the trade effects of the subsidy . The 
specific nature and scope of such statistics is left to the judgem ent of the notifying 
Member . To the extent possible, relevant and/or determinable, however, it is 
desirable that such information include statistics of production, consumption, 
imports and exports of the subsidized product(s) or sector(s ). 
 
a. For the three m ost recent years for which st atistics 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/315/DOM  
- 3 - 
 
Evolution of the Main Variables of Free -Export Zones , 199 7-2017 
Year Industrial 
estates in 
operation  Enterprises  Jobs Exports  
(US$  million ) Local 
expenditure  
(US$  million ) Average weekly salary  
(RD$)  Surface area of 
industrial premises 
in use (sq , ft,) Workers  Technical staff  
1997 40 446 182,174 3,596.4 701.0 634.27 1,441.12 15,603,755.00 
1998 43 496 195,193 4,100.0 826.5 638.32 1,556.90 17,540,407.00 
1999 44 484 189,458 4,331.5 887.3 701.21 1,587.22 16,820,049.00 
2000 46 481 195,262 4,770.6 1,018.6 716.51 1,629.85 21,068,186.00 
2001 51 512 175,078 4,481.6 977.9 775.49 1,662.93 21,738,332.00 
2002 53 520 170,833 4,317.3 886.5 786.56 1,671.53 21,923,764.00 
2003 54 531 173,367 4,406.8 810.8 961.34 2,010.79 22,066,221.00 
2004 58 569 189,853 4,685.2 863.4 1,131.25 2,539.82 24,332,619.00 
2005 57 556 154,781 4,747.7 1,005.4 1,347.09 2,702.67 24,540,452.80 
2006 56 555 148,411 4,678.6 973.7 1,465.19 3,009.97 26,338,045.10 
2007 53 526 128,002 4,252.2 1,010.9 1,480.37 3,127.22 24,609,122.90 
2008 48 525 124,517 4,354.1 954.3 1,652.80 3,533.22 25,299,744.60 
2009 47 553 112,618 3,793.5 959.0 1,819.00 3,689.56 29,037,744.60 
2010 48 555 121,001 4,217.6 1,123.1 1,829.03 3,841.64 29,268,270.40 
2011 51 578 125,117 4,884.5 1,163.5 1,967.15 3,892.63 30,067,075.70 
2012 53 584 134,226 4,940.1 1,298.2 2,175.88 4,204.14 30,385,854.60 
2013 55 602 144,383 4,950.5 1,326.0 2,352.49 4,483.04 33,804,830.40 
2014 60 614 153,342 5,261.7 1,368.1 2,508.76 4,773.39 34,899,477.30 
2015 65 630 161,257 5,423.6 1,434.5 2,536.18 4,850.50 35,869,810.40 
2016*  68 645 163,147 5,503.9 1,457.9 2,659.03 5,148.21 36,958,201.70 
2017** 71 665 165,724 5,694.7 1,482.7 2,798.37 5,302.91 37,283,897.40 
Growth % 
2016 -2017  4.4 3.1 1.6 3.5 1.7 5.2 3.0 0.9 
Source for exports and foreign exchange : Central Bank of the Dominican Republic and National Free  Zones Council.  
* Corrected export figures . 
** Preliminary export and foreign exchange figures . G/SCM/N/315/DOM  
- 4 - 
  Contribution of Free Zones to the GDP of  the Dominican  Republic  
1997-2017 (RD$  million ) 
Year GDP Free zones  Contribution (%)  
1997 280,362.8 12,022.1 4.3 
1998 318,649.0 15,948.1 5.0 
1999 350,520.1 17,726.8 5.1 
2000 393,303.0 21,336.9 5.4 
2001 427,319.1 22,605.9 5.3 
2002 477,430.2 27,344.1 5.7 
2003 628,611.0 50,260.7 8.0 
2004 935,984.7 72,961.9 7.8 
2005 1,083,445.0 54,667.7 5.0 
2006 1,261,399.7 59,413.2 4.7 
2007 1,458,416.5 58,296.4 4.0 
2008 1,661,642.7 57,838.6 3.5 
2009 1,736,041.1 59,002.2 3.4 
2010 1,983,201.7 64,621.3 3.3 
2011 2,210,213.9 73,420.6 3.3 
2012 2,386,016.2 81,678.1 3.4 
2013 2,619,769.7 88,554.8 3.4 
2014 2,877,527.8 98,757.6 3.4 
2015 3,099,651.2 103,677.5 3.3 
2016 3,333,419.3 108,383.2 3.3 
2017*  3,613,147.1 117,080.7 3.2 
Source : Central Bank of the Dominican Republic and National Free  Zones Council . 
* Corrected figures.  
 
Contribution of Free Zones to the GDP of  the Dominican  Republic  
1997-2017 
020000400006000080000100000120000140000G/SCM/N/315/DOM  
- 5 - 
  Free-Zone Exports by Principal Activities, 200 9-2017 
(US$  million ) 
Activity  2009 2010 2011 2012 2013 2014 2015 2016* 2017** Share 
% Growth  
% 
Medical and 
pharmaceutical 
products  963.0 1,070.7 1,178.5 1,213.3 1,230.6 1,274.2 1,361.1 1,497.0 1,485.4 26.1 -0.8 
Clothing and 
textiles  933.5 983.9 1,295.6 1,280.6 1,219.2 1,241.9 1,247.9 1,102.8 1,067.8 18.8 -3.2 
Electrical and 
electronic 
goods  565.5 581.6 623.9 638.7 658.2 752.8 707.3 750.6 883.1 15.5 17.7 
Tobacco and 
tobacco 
products  403.1 426.6 424.7 506.4 531.7 586.9 660.3 695.9 793.6 13.9 14.0 
Footwear  and 
their 
components  201.0 312.8 389.1 406.5 422.2 449.5 443.0 424.7 391.3 6.9 -7.9 
Jewellery  435.7 466.2 527.2 450.5 315.5 283.7 369.9 407.0 422.2 7.4 3.7 
Other  291.7 375.7 445.5 444.0 573.2 672.7 634.1 625.9 651.3 11.4 4.1 
Total  3.793 .5 4,217.5 4,884.5 4,940.1 4,950.5 5,261.7 5,423.6 5,503.9 5,694.7 100.0 3.5 
Source : Central Bank of the Dominican Republic and National Free Zones Council . 
* Corrected figures.  
** Preliminary figures.  
 
Free-Zone Exports by Principal Activities, 2017  
(US$  million ) 
 Medical and 
pharmaceutical 
products  
26%  
Clothing and  
textiles  
19%  
Electrical and 
electronic goods  
16%  Tobacco and  
 tobacco products  
14%  Footwear and 
components  
7% Jewellery  
7% Other  
11%  G/SCM/N/315/DOM  
- 6 - 
  Comparison of Domestic and Free -Zone Exports , 199 7-2017 
(US$  million ) 
Year Domestic 
exports  Growth  
%  Free-zone 
exports  Growth  
%  Total 
exports  Free-zone 
exports/total 
exports  
(%) 
1997 1,017.3 - 3,596.4 - 4,613.7 78.0 
1998 880.3 -13.5 4,100.2 14.0 4,980.5 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 4,217.5 11.2 6,753.6 62.4 
2011 3,727.8 47.0 4,884.5 15.8 8,612.3 56.7 
2012 4,129.0 10.8 4,940.1 1.1 9,069.1 54.5 
2013 4,473.8 8.4 4,950.5 0.2 9,424.3 52.5 
2014 4,637.2 3.7 5,261.7 6.3 9,898.9 53.2 
2015 4,018.2 -13.3 5,423.6 3.1 9,441.8 57.4 
2016*  4,335.7 7.9 5,503.9 1.5 9,839.6 55.9 
2017**  4,426.0 2.1 5,694.7 3.5 10,120.7 56.3 
Source : Central Bank of the Dominican Republic and National Free Zones Council . 
* Corrected figures . 
** Preliminary figures . 
 
Comparison of Domestic and Free -Zone Exports, 201 7 
 
 
 
__________  Domestic Exports  
56.3%  Free -Zone Exports  
43.7%