WORLD TRADE  
ORGANIZATION  G/SCM/N/186/MUS/Rev.1 
G/SCM/N/192/MUS/Rev.1 28 September 2009 
 
(09-4511) 
Committee on Subsidies 
and Countervailing Measures Original:   English 
 
 
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  
 
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  
 
 
MAURITIUS 
 
Revision  
 
 
 The following communication, dated 7 September 2009, is being circulated at the request of 
the Delegation of Mauritius.    
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 Please find attached, for circulation to Member s of the Committee, the updated notification of 
Mauritius in respect of:   (a) Freeport Scheme:  Corporate tax exemp tion on income derived from activities carried 
out in the Freeport zone except from Freeport Operators and private Freeport 
Developers licensed after 1 June 2002 to carry out any specified Freeport processing 
activities;  and 
  (b) Freeport Scheme:  Custom and Excise Duty exemption concession on machinery and 
equipment imported into the Freeport Zone. 
 
 This notification is also submitted pursuant to  the General Council Decision of 27 July 2007. 
 G/SCM/N/186/MUS/Rev.1 
G/SCM/N/192/MUS/Rev.1 Page 2 
 
 
   
I. FREEPORT SCHEME 
 
1. Title of the Subsidy Programme
 
 
 Freeport Scheme   Description of the scheme  Customs and excise duty exemption 
 
2. Period covered by the notification
 
  June 2008–June 2009  
3. Policy objective
 
  To promote an encourage freeport trade includi ng transit and entrepot trade and to position 
Mauritius as a major regional distribution, transhipment and marketing centre.  4. (a) Background authority for the scheme
 
 
  The Board of Investment and th e Customs and Excise Department. 
  (b) Legal Basis
 
 
  Freeport Act 2004 
 5. Form of Subsidy
 
  Customs and Excise Duty concession on machinery and equipment imported into the Freeport Zone. 
 
6. Beneficiaries
 
  Private Freeport Developers, Third Party Fr eeport Developers and Freeport Operators. 
 
7. Subsidy per amount or Total Subsidy
 
  The Government suffers no effective loss of  income due to foregone taxes since these 
activities would not have taken place in Mauritius wit hout the existence of the Freeport and its related 
incentives.  
8. Duration of the Subsidy
 
  The scheme is not limited in time.  9. Assessment of trade effects
 
 
 The scheme has encouraged international comp anies to carry out value added activities such 
as labelling, packing, repacking and mixing in the Freeport Zone.    G/SCM/N/186/MUS/Rev.1 
 G/SCM/N/192/MUS/Rev.1  Page 3 
 
 
  1. Title of the Subsidy Programme
 
  The Freeport Scheme  
 Description of the scheme 
 Corporate Tax Exemption   2. Period covered by the notification
 
 
 June 2008-June 2009 
 3. Policy objective
 
  To encourage trading companies to use the Mauritius Freeport as a logistics and marketing 
platform for the re-exportation of their goods to Eastern and Southern Africa. 
 4. (a) Background authority for the scheme
 
   The Board of Investment a nd the Income Tax Department 
 
 (b) Legal basis
 
   Income Tax Act 1995 (section 49)  5. Form of Subsidy
 
 
 Corporate tax exemption on income derived fro m activities carried out in the Freeport zone 
except for Freeport Operators and private Freeport De velopers licensed after 1 June 2002 to carry out 
any specified Freeport processing activities.  6. Beneficiaries
 
 
 Freeport Operators and Private Freeport De velopers which are engaged in processing 
(licensed on or before 1 June 2002) and those engaged in light assembly, ship building, repairs and maintenance.  
7. Subsidy per unit or Total amount
 
  The Government suffers no effective loss of inco me due to forgone taxes since these activities 
would not have taken place in Mauritius without th e existence of the Freeport and in its related 
incentives.  
8. Duration of the subsidy
 
  The scheme is not limited in time.  9. Assessment of trade effects
 
 
 This incentive has contributed to the development of the Mauritius Freeport.  G/SCM/N/186/MUS/Rev.1 
G/SCM/N/192/MUS/Rev.1 Page 4 
 
 
  Action taken by Mauritius to eliminate export subsidies  
 
 Mauritius is not planning to introduce any ne w export subsidy and is in fact committed to 
remove the export subsidies for the Freeport sector.  However, due to the fina ncial crisis we had to 
extend the removal of the corporate tax exemption for the Freeport.   
  As regards customs and excise duty concessions  on machinery and equipment imported into 
the Freeport, there is virtually no customs and excise duty on machinery and equipment. 
 Corporate tax exemption  
 It will be recalled that in the Finance Ac t 2006, we had made provision to remove the 
corporate tax exemption for the Freeport as from 1 July 2009.  However, the global economy is mired in the worst financial crisis since the Great Depr ession and Mauritius had to stand prepared for the 
worst.  In this context, the Government announced  the extension of the income tax exemption under 
the transitional provisions granted to a private fr eeport developer or freeport operator by a further 
period of 2 years, up to 30 June 2011 (Section  8(b)(i) of the Additional Stimulus Package 
(Miscellaneous Provisions) Act 2009).  
Customs and Excise duty concession on machinery and equipment into the Freeport 
  We wish to point out that although notifica tion was made regarding excise duty concession on 
machinery and equipment, there was no excise duty thereon    As regards Customs duty, we have undertak en major reforms in the 2006 Budget and 2008 
Budget with the result that 86 per cent of the tariff lines are now zero-rated.  Virtually all imported 
industrial machinery and equipment do not attract a ny customs duty.  A copy of our updated Customs 
Tariff Schedule is available in the web-site of  the Mauritius Revenue Authority (www.mra.mu). 
 
 
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