. /. WORLD TRADE  
ORGANIZATION   
G/SCM/Q3/GTM/15 
13 September 2012  
 
(12-4895) 
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 concerning the 
Updating Notification of GUATEMALA1 
 
 
 The following communication, dated 10 Septembe r 2012, is being circulated at the request of 
the delegation of Colombia.  
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Programmes: 
 
(1) Exemption from Company Tax; exemption from customs duties and other import taxes, 
including Value Added Tax (VAT), on mach inery, equipment, parts, components and 
accessories required for the production process of  companies under special customs regimes. 
 
(2) Exemption from Company Tax; exemption from customs duties and other import taxes, 
including Value Added Tax (VAT), on mach inery, equipment, parts, components and 
accessories required for the production process rel ating to activities of managers and users 
of free zones. 
 
(3) Exemption from Company Tax; exemption from customs duties and other import taxes, 
including Value Added Tax (VAT), on mach inery, equipment, parts, components and 
accessories required for the production process of  commercial and industrial enterprises 
operating in the Industrial and Trade Free Zone (ZOLIC). 
 
Question 1  
 
 Has Guatemala explicitly notified the beneficiarie s of the tax exemptions that pursuant to the 
obligations arising from the SCM Agreement and specifi cally in the light of Article 27.4 thereof, the 
measures will not be extended beyond 31 December  2015 and their dismantling will begin by 2013 at 
the latest?  If so, what is the procedure for notif ying these beneficiaries, and does Guatemala envisage 
any transition programme towards total dismantling?  Have any domestic measures been taken yet to 
eliminate the subsidies?  Could you provide us  with documentation relating to this process? 
 
                                                      
1 G/SCM/N/243/GTM. G/SCM/Q3/GTM/15 
Page 2  
 
  Question 2  
 
 In the mentioned notification, the Government of Guatemala replies to the question on the amount of the subsidy for the th ree programmes as follows:  " Subsidies are granted in accordance 
with the exporters' income, they cannot therefore be  quantified given that they vary each fiscal year ."  
Similarly, in the request for information on statistical data, Guatemala replies, for the 
three programmes, as follows:  "No such statistical information is available."  
In view of these replies, we would appreciat e information on the mechanism which enables 
the Government of Guatemala to ensure that it has not increased the fav ourability of the notified 
programmes.  Also, without the mentioned inform ation, how can the Government of Guatemala 
ensure that the status quo of the programme is maintained?  Would it be possible to produce an 
estimate using as a basis the exempted CIF imports so  that the magnitude of the subsidies granted can 
be established?  Could this estimate be provided before the next meeting of the SCM Committee? 
 Question 3 
 
 The Government of Guatemala states that the Working Group within the Ministry of the 
Economy in charge of proposing options for brin ging the programmes which come under Article 27.4 
of the SCM Agreement into conformity with the Agreement carried out a number of activities with 
different entities, and following these activities, drew up a report containing specific 
recommendations (page 1, indent (a)). 
  Could the Government of Guatemala please tell us what the main recommendations produced 
by this working group are, and if they are dir ected towards dismantling the subsidies within the 
time-frame established at the multilateral level? 
 
Question 4  
 
 In indent (c) on page 2, the Govern ment of Guatemala mentions that " [a] final version of the 
draft law is due to be sent to the General Sec retariat of the President's Office in August or 
September 2012 for approval and referral back to the Congress ".  Given that the SCM Committee 
meeting is taking place in October, and the indicated  time-period will be over, it would be useful to 
have an update on the draft law.  Generally speakin g, we would like to know how the Government of 
Guatemala has planned to dismantle the subsidies in such a way as to ensure that they are not applied 
beyond 2015.  We would also like to know if anything specific has been planned to that end.  When does Guatemala intend to submit the action plan mentioned in paragraph 1(f) of Decision WT/L/691? 
 
Question 5  
 
 Guatemala dos not include in its notification any information as to whether it has introduced 
the changes to the original programme and wh ether it has increased the number of companies 
involved in the programmes.  We would be grateful if Guatemala could inform the Committee or send 
information in this respect before the SCM Committee meeting. 
 
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