WORLD TRADE  
ORGANIZATION   
G/SCM/Q3/CRI/10 
13 September 2012  
 
(12-4894) 
Committee on Subsidies and 
Countervailing Duties Original:   Spanish 
 
 
 
SUBSIDIES 
 
Continuation of Extension under SCM Artic le 27.4 of the Transition Period for 
the Elimination of Export Subsidies Pursuant to the Procedures Contained 
in the General Council Decision in Document WT/L/691 
 
Questions from COLOMBIA regarding the 
Updating Notification of COSTA RICA1 
 
 
 The following communication, dated 10 September 2012, is being circulated at the request of 
the delegation of Colombia.  
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Programmes: 
1. Duty-Free Zone Regime 
Summary:   The programme consists of a set of ince ntives and benefits for enterprises making new 
investments in Costa Rica, subject to compliance wi th the requirements and obligations laid down in 
Law No. 7210 and amendments thereto, and its impl ementing Regulations.  One of the qualification 
criteria was the requirement that at least 75 per cen t of an enterprise's production be exported. The 
Regulations establish the definition of "new invest ments in the country".  The establishment location 
of a group of enterprises operating as beneficiaries of this Regime is called a "Duty-Free Zone", 
which is required to be a defined area, without a resident population, authorized by the Executive to 
operate in this capacity. 
 
Question 1  
 
 The Government of Costa Rica had said that  it does not have the comprehensive information 
required to estimate the amount of the subsidy.  In the absence of this information, how can 
Costa Rica establish the benefit levels that will en sure that the status quo of the Duty-Free Zone 
Programme is maintained?  Would it be possible, in stead, for Costa Rica to provide the annual value 
in CIF terms of goods from abroad entering the du ty-free zones and the rates actually exempted so 
that we can have an approximate figure for the amount of subsidies granted? 
 
                                                      
1 G/SCM/N/243/CRI. G/SCM/Q3/CRI/10 
Page 2  
 
  Question 2  
 
 Costa Rica states that it ha s notified all the beneficiaries under the programme that no more 
export subsidies would be granted to processing ente rprises after the end of calendar year 2015.  How 
was this notification made?  Have you planned an y transition programme towa rds total dismantling?  
In connection with transition plan s, have any domestic measures been taken yet to eliminate the 
subsidies?  Could you provide us with documentation relating to the process?   
 
Question 3  
  Costa Rica mentions that with the revision of the Duty-Free Zone Law, companies that wish 
to operate under the Duty-Free Zone Regime must be  from the following strategic sectors:  advanced 
electronics;  advanced electronic components;  me dical devices, equipment, implants and inputs and 
the highly specialized packing or containers for such goods;  automobiles;  high-precision machine 
parts and components;  aerospace and aeronautics;  pharmaceuticals and biotechnology;  renewable 
energy sources;  automation and flexible manufacturing systems;  and advanced materials. 
  How are these sectors chosen and on the basis of wh at criteria is a sector considered strategic?  
Apart from the Duty-Free Zone Regime, what other benefits are granted to these strategic sectors? 
 2. Inward Processing Regime 
 Summary:  The Inward Processing Regime is the customs regime allowing the entry of goods into 
national customs territory with the suspension of all types of taxes, subject to lodgement of a 
guarantee deposit.  The goods must be re-exported, w ithin the time-limits laid down in the relevant 
regulations, after undergoing processing, repair, rec onstruction, installation or assembly, or after 
being incorporated in sub-assemblies, machinery, tr ansport equipment in genera l or appliances with a 
higher degree of technological or functional comp lexity, or after being used for other similar 
purposes, under the conditions laid down in the regu lations or provisions stipulated for this purpose 
by the competent administrative authority.  
Question 1  
 
 The Government of Costa Rica states that " the information required to estimate the amount of 
the subsidy granted under this Regime is not available ".  In the absence of this information, how can 
the Government of Costa Rica establish the benefit leve ls that would ensure that the status quo of the 
Inward Processing Regime is maintained?  Would it be possible to produce an estimate using as a 
basis the exempted CIF imports so that the magnitu de of the subsidies granted can be established? 
 
Question 2  
 
 Costa Rica indicates in the Action Plan th at the inter-institutional commission "has 
preliminarily identified some of the legislative a nd regulatory changes that will be necessary to amend 
the Inward Processing (…) and Drawback Regimes (Executive Decree No. 26285-H-COMEX 
of 19 August 1997).  Once this process has been co mpleted, the corresponding amendments can begin 
to be prepared and implemented." (page 15)   When does Costa Rica intend to complete this  analysis?  Do such changes have to be 
approved by Congress?  Does the time-frame for c ongressional approval of the changes coincide with 
the deadline for dismantling the subsidies under the SC M Agreement?  Is it clear that the changes 
target the elimination of the subsidies granted?   G/SCM/Q3/CRI/10 
 Page 3 
 
 
  Question 3  
 
 Costa Rica does not include in its notificati on any information as to whether it has introduced 
changes to the original programme and whether it has increased the number of companies involved in 
the programmes.  We would be grateful if Costa Rica could inform the Committee or send 
information in this respect before the SCM Committee meeting. 
 
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