. /.   WORLD TRADE  
ORGANIZATION  G/SCM/Q3/MUS/17 
28 October 2010 
 (10-5661) 
Committee on Subsidies and  
Countervailing Measures Original:   English 
 
 
 
SUBSIDIES  
 
Continuation of Extension under SCM Article 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  
 
Replies to Questions Posed by the UNITED STATES1  
Regarding the Notification of MAURITIUS2 
 
 
 The following communication, dated 27 October 2010, is being circulated at the request of the Delegation of Mauritius.    
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Freeport Scheme – Customs Duty and Excise Du ty Concession on Machinery and Equipment 
Imported into Freeport  
Freeport Scheme – Corporate Tax Exemption  
 
Question 1 
 
• Mauritius has stated that as it has u ndertaken major reforms in the 2006 and 
2008 budgets with the result that 86 p ercent of the tariff lines are now duty free 
and that virtually all imported industrial machinery and equipment do not attract any customs duty.  Could Mauritius please explain whether these reforms 
have removed all of the export subsid y elements of the Freeport Scheme – 
Customs and Excise Duty Exemption on  Machinery and Equipment imported 
into the Free Zone?  Could Mauritius also please clarify whether it will no longer be seeking an extension of the transition period that had previously been granted for this program?  If Mauritius does in tend to seek an extension, please provide 
a full notification of the program and the detailed action plan required by the 
General Council Decision in Docu ment WT/L/691 (GC Decision). 
 
Reply
 
  As a consequence of these reforms, custom s duty on industrial machinery and equipment has 
been eliminated in all sectors.  Therefore, the reforms have certainly im pacted favourably on the 
removal of all of the export subsidy elements of the Freeport Scheme-Customs and Excise Duty 
Exemption on Machinery and Equipment imported in to the Free Zone.  Besides and as already 
mentioned in Communication G/SCM/N/211/MUS dated 6 September 2010,  although notification 
                                                     
 
1 G/SCM/Q3/MUS/16 and Corr.1.   
2 G/SCM/N/211/MUS.   G/SCM/Q3/MUS/17 
Page 2  
 
  was made regarding excise duty concession on machin ery and equipment in the Freeport sector, there 
is no excise duty on these products. 
  Mauritius will no longer be seeking an extension of the transition period previously granted 
for this programme.  
 
 Due consideration is being given for the submi ssion of a notification of the programme and an 
action plan, perhaps as an addendum to the aforementioned Communication G/SCM/N/211/MUS of 
6 September 2010.  Question 2 
 
 
• As part of the notification of its action plan for the Freeport Scheme – Corporate 
Tax Exemption , Mauritius only states that "Depending on the health of the 
world economy and the economic situatio n in Mauritius which is currently 
facing the impact of the global economi c downturn and the Euro zone crisis, 
corporate tax exemption for the Freepor t may be reviewed in 2011-2012".  The 
GC Decision, however, requires Members to provide detailed information on how the export subsidies will be eliminated, including information as to legislative changes, administrative amen dments and/or other procedures as may 
be necessary, and whether any of these actions have been undertaken or are in 
the process of being undertaken.  The United States respectfully requests that 
Mauritius provide the necessary information pursuant to the GC Decision. 
 
Reply
 
 
 With respect to the Freeport Scheme Subs idy programme–Corporate Tax exemption, the 
relevant authorities have in good faith already made provision under Section 8 8 (b) (i) of the 
Additional Stimulus Package (Miscellaneous Provisi ons) Act 2009 for the removal of this programme 
as from 30 June 2011.  The beneficiaries of the pr ogramme are aware that the programme will end as 
from that date being given that the Additional S timulus Package (Miscellaneous Provisions) Act was 
duly gazetted on 16 April 2009.  Therefore, in the run up to the deadline of 31 December 2015, the 
Government of Mauritius foresees that in the norma l course of events the said programme would be 
effectively terminated on 30 June 2011.    
Question 3 
 
 Decision 691 also requires that all beneficiaries be individually notified of the 
termination of the export subsidies by the end of  calendar year 2015.  Has Mauritius notified all 
of the beneficiaries?  
Reply
 
 
 As indicated above, the beneficiaries of the programme are aware that the programme will 
end as of 30 June 2011 in view of the fact that  the Additional Stimulus Package (Miscellaneous 
Provisions) Act was gazetted on 16 April 2009.   
 
 
 
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