WORLD TRADE  
ORGANIZATION   
G/SCM/Q2/HND/8  
11 January 2013 
 (13-0171) 
Committee on Subsidies and  
Countervailing Measures Original:   Spanish 
 
 
 
SUBSIDIES 
 
Replies to the Questions from COLOMBIA1 Regarding the 
New and Full Notification of the HONDURAS2 
   The following communication, dated 12 November 2012, is being circulated at the request of 
the delegation of Honduras.  
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Subsidy programmes: 
 1. Temporary Import Regime (RIT); 
2. Export Processing Zones (ZIP);  and 
3. Free Zones. 
 
Question 1 
 
 Could Honduras clarify whether these three subsidy programmes form part of 
Honduras' reservation of rights
3, under SCM Article 27.4 in respect 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? 
 
Reply 
  Honduras' subsidy programmes are covered by Annex VII of the Agreement on Subsidies and 
Countervailing Measures to which Honduras is a party.  
Question 2 
 
 The most recent notification submitted (G/SCM/N/220/HND) covers the year 2010.  
When does Honduras intend to submit its notification for 2011? 
 
                                                      
1 G/SCM/Q2/HND/6. 
2 G/SCM/N/220/HND. 
3 Document WT/L/691, page 4, footnote 7:  "The Members that reserved rights, and the programmes in 
respect of which these rights were reserved, are identified in documents G/SCM/N/74/BOL & Suppl.1, 
G/SCM/N/74/HND, G/SCM/N/74/K EN and G/SCM/N/74/LKA." G/SCM/Q2/HND/8 
Page 2  
 
  Reply 
 
 Honduras submitted its notification for the year 2011 in document G/SCM/N/220/HND/Rev.1 
dated 4 October 2012.  Question 3 
 
 What are the conditions for a company to opera te in an Export Processing Zone?  Please 
explain how the tax exemption is not co ntingent upon export performance. 
 Reply 
 
 Conditions or requirements for a company to operate in an Export Processing 
Zone (ZIP) : 
 
- Establishment as a public limited company with fixed capital, underwritten and paid 
up in an amount not less than two million lempiras (L 2,000,000); 
 - the sole purpose of the company must be to exploit the Export Processing Zone (ZIP);  - proof that the property required for the purposes of the Export Processing Zone is 
available;  and 
 - proof that the technical and financial resources for promotion, supply of services and 
development of the necessary infrastructur e are available in order to create a 
minimum of 5,000 new jobs over a period of five years. 
 
The application referred to in the previ ous article, which must contain the name, 
nationality and domicile of each of the orga nizers or promoters, shall be accompanied 
by: 
  - The draft public deed and the statutes; 
 
- the financial and administrative structure and estimates of the enterprise's 
performance over ten (10) years; 
 
- an economic study justifying the establishment of the proposed Export Processing 
Zone;  and 
 
- plans of the Zone and proposed insta llations, showing the relevant capacity 
and specifications. 
 
 It should be noted that the beneficiaries of this Law must be enterprises engaged in the 
processing and exportation of industrial goods. 
  The Law on Export Processing Zones was enac ted as an effective means for creating 
large-scale employment, contributing to the diversif ication of the industrial base and generating rapid 
growth and greater indirect employment in the economy.  However, this benefit was granted to 
companies engaged in the importation and processing of goods entirely for export. 
  G/SCM/Q2/HND/8 
 Page 3 
 
 
  Question 4 
 
In the notification, in reply to the question on the duration of the subsidy, the 
Government of Honduras states for the three prog rammes that "the benefits currently granted 
to enterprises under the RIT, ZIP and Free Zone programmes are of indefinite duration".  Why 
does Honduras not plan to eliminate the subsid ies pertaining to these three programmes within 
a particular time-frame? 
 
Reply 
  -- 
 
Question 5   In the notification, in reply to the qu estion on the amount of the subsidy, the 
Government of Honduras states for the three pr ogrammes that "any calculation of the amount 
of the subsidy per unit [is] impossible.  Th e information requested can therefore not be 
provided".  Could the Government of Honduras please inform the Committee whether it has 
made any changes in respect of the original pr ogrammes?  Has the level of export subsidies 
increased?  Would it be possible to provide some  approximate figures to support the answer to 
this question? 
 Reply 
 
 The original programmes remain in force, and in order to quantify th e amount of the fiscal 
sacrifice, Honduras enacted the Law on Income and Efficiency in Public Expenditure, approved 
by Decree 113-2011, which entered into force on 8 July 2011.  Article 34 of that Law provides for 
mandatory declaration of fiscal sacrifice by natura l or legal persons benef iting from exemptions or 
operating under a special regime, so that inform ation on the amount of the subsidies should be 
available soon.  
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