WORLD TRADE  
ORGANIZATION   
G/SCM/N/243/GRD 
28 June 2012 
 (12-3436) 
Committee on Subsidies and 
Countervailing Measures Original:   English 
 
 
 
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 
 
Updating Notification 
 
GRENADA 
 
  The following communication, dated 25 June 2012,  is being circulated at the request of the 
Delegation of Grenada.  
_______________ 
 
  We hereby submit to the Committee on Subsidies and Countervailing Measures, Grenada's updated Notification on Current Incentive Programmes under Articles 25  and 27 of the 
SCM Agreement and Article XVI:1 of GATT . 
 
 Please be informed, that not all elements of  the notified programmes, including subsidies 
provided thereunder, necessarily involve export subsidies.   Grenada wishes to reiterate that, in keeping with Article 25.7 of the Agreement on Subsidies 
and Countervailing Measures, this notification does not prejudice the legal status of the notified 
programmes under the GATT 1994 or the said Agreemen t, their effects under the Agreement or the 
nature of the programmes or measures;  furthermore, notification of a programme or measure does not prejudice its actionable or non-actionable nature.  G/SCM/N/243/GRD 
Page 2  
 
  Programmes 
  
Page 
 
I.  STATUTORY RULES AND ORDERS NO. 37 OF 1999 ...................................................... 2  
II.  FISCAL INCENTIVES ACT NO. 41 OF 1974 ...................................................................... 4  
III. QUALIFIED ENTERPRISES ACT NO. 18 OF 1978 ........................................................... 7  
 
 
 
I. STATUTORY RULES AND ORDERS NO. 37 OF 1999 (LIST OF CONDITIONAL 
DUTY EXEMPTION - CARICOM COMMON EXTERNAL TARIFF) 
A. DESCRIPTION OF THE PROGRAMME  
1. Title of the subsidy programme if relevant, or brief descrip tion or identification of the subsidy 
 
 The list of Conditional Duty Exemptions sets out the goods which, when imported, may be admitted free of import duty or at a rate that is  lower than set out in the Schedule of rates. 
 2. Period covered by the notification 
 
 As of 1 July 2011-30 June 2012 – programme status. 
 3. Policy objective and/or purpose of the subsidy 
  To provide for the development of Grenada's pr iority economic sectors, social services, public 
services and matters relating to Grenada's regional and international obligations. 
 4. Background and authority for the subsidy (inc luding identification of the legislation under 
which it is granted) 
 
Background 
  This legislation was passed in order to in troduce the new Common External Tariff based on 
the Harmonized Commodity Description and Coding sy stem, in accordance with legal obligations 
falling upon Grenada by virtue of our adherence to  membership in the Caribbean Common Market 
(CARICOM). 
 
 CARICOM Common External Tariffs, Statutory Rules and Order 37 of 1999 has been revised 
based on the Harmonised Commodity Descriptio n and Coding System 2007 and is now the 
CARICOM Common External Tariff Statutory Rules and Orders No. 42 of 2009.  Authority 
  CARICOM Common External Tariff, Statutory Rules and Order No. 42 of 2009.   The relevant Ministries together with the Comptroller of Customs are responsible for 
administering this legislation. 
  G/SCM/N/243/GRD 
 Page 3 
 
 
  5. Form of Subsidy 
 
 The List of Conditional Duty Exemptions allows  enterprises, organizations or persons to be 
exempted from duty or be charged a lower rate , than that laid down by the Customs Tariff 
Regulations. 
 
 The classification structure of the Schedule of  Rates is based on the Harmonized Commodity 
Description and Coding system.  The rates of dut y in the schedule are applicable to imports from 
third countries into the Member States of th e Caribbean Common Market as well as goods traded 
among the Member states. 
 
 On some inputs the rate applied by Grenad a, as a Least Developed Country within the 
Caribbean Common Market, may be from 0 per cent to 5 per cent.  6. To whom and how the subsidy is provided 
  Dependant on the nature of the enterprise and the products to be imported an application must 
be made to that competent authority.   The Comptroller of Customs once satisfied that the product imported is solely for the use approved of, grants the exemption. 
 
7. Subsidy per unit, or in cases where this is not possible, the total amount or the annual amount 
budgeted for that subsidy 
 
 Due to the nature and coverage of the progra mme, there are no statistical data available on the 
amount of subsidy per unit or annua l amounts budgeted for this programme. 
 8. Duration of subsidy and/or any other time  limits attached to it, including date of 
inception/commencement 
 
 Raw materials for product manufacturing, in a ll other cases for one off importation or the 
initial equipping, construction or extension of a facility as approved by the Competent Authority. 
 9. Statistical data permitting an assessmen t of the trade effects on the subsidy 
 
 There is no such statistical information available. 
 
B. DESCRIPTION OF DOMESTIC PROCEDURES NECESSARY TO ELIMINATE EXPORT SUBSIDY  
 The CARICOM Common External Tariff (CET) Statutory Rules and Orders (SRO) No. 42 
of 2009 which is based on the Harmonized Commodity Description and Coding System 2007 
represents the Common External Tariff as implemente d in the Agreement that forms the Caribbean 
Common Market of which Grenada is a member. All member of the CARICOM Common Market 
apply the CET. 
  SRO No. 42 of 2009 does not contain any provisi ons relating to export subsidies.  Duty free 
concessions granted under SRO No. 42 of 2009 are not contingent on exports. 
 
C. D
ESCRIPTION OF ACTIONS TAKEN  
 There are no beneficiaries of export subsid ies under SRO No. 42 of 2009 and therefore, 
Grenada had no beneficiaries to notify. G/SCM/N/243/GRD 
Page 4  
 
  D. D
ESCRIPTION OF FUTURE ACTIONS  
 Given that there is no provision in SRO No. 42 of  2009 that is contingent on exports, there is 
no need for amendment of the Act.   
II. FISCAL INCENTIVES ACT NO. 41 OF 1974 
A. DESCRIPTION OF THE PROGRAMME  
1. Title of the subsidy programme if relevant, or brief descrip tion or identification of the subsidy 
 
 The Fiscal incentives Act is an Act to attract, mobilize and direct capital for new investment. 
 
2. Period covered by the notification 
 
 As of 1 July 2011-30 June 2012 – programme status.  3. Policy objective and/or purpose of the subsidy 
  To attract private investors who will contribut e to the desired expansion of national output, 
thereby promoting economic growth and development.  4. Background and authority for the subsidy (inc luding identification of the legislation under 
which it is granted) 
 
Background 
  The promotion of private investment is an integr al part of the development plan of Grenada as 
we continue to diversify production and reduce our reliance on Agricultural production.  Economic 
expansion generates demand for foreign excha nge.  Given our narrow resource base Grenada 
continues to need resource inflows and one of the b est ways to achieve this is through direct foreign 
investment.   The Fiscal Incentives Act was passed to give e ffect to an agreement on the harmonization of 
fiscal incentives to industry among CARICOM countries. 
 
Authority 
  Fiscal Incentives Act No. 41 of 1974.  Chapte r 107 of the 1990 Revised Laws of Grenada. 
 
 The Grenada Industrial Development Corporati on (GIDC) is responsible for administrating 
this incentive programme.   Since Grenada's initial notification in Decemb er 2001, no modification was made to the Fiscal 
Incentive Act No. 41/1974 according to paragraph 4 of document G/SCM/39. 
 
5. Form of Subsidy 
 
 The Fiscal Incentives Act provides relie f from taxes in the following ways: 
 
- Waiver from Customs duty on plant, equipmen t, machinery, spare parts, raw materials 
or components thereof, for between ten (10) to fifteen (15) years, dependant on which  G/SCM/N/243/GRD 
 Page 5 
 
 
  group of enterprise.  This is also subject  to the satisfaction of the Comptroller of 
Customs and excise, that the above list is required for: 
 (a) Constructing, altering, reconstruc ting or extending the approved enterprise, 
that is, an enterprise declared by Order of the Minister responsible for industry;  or 
 
 (b) Equipping an enterprise for the purpose of manufacturing and approved 
product, that is, a product declared by Order of the Minister responsible for industry. 
 
- Complete or partial exemption from the paym ent of income tax on the profits arising 
from the sale of an approved product from the production day for a period not exceeding the time given to the Ente rprise, that is 10-15 years. 
 - Where shareholders or their nominees are not resident in Grenada, they shall be 
exempted from income tax on dividends, in respect of the amount of tax that exceeds 
the tax liability of the shareholder in his country of residence. 
 - Where the export profits of enterprises refe rred to in the Act, amount to ten (10) per 
cent or more of the entire profits of the enterprise, from the export of an approved product, relief shall be granted from income tax on the export profits.  This relief is 
granted by way of tax credits. 
 
6. To whom and how the subsidy is provided 
  Fiscal incentives are granted to private investors to facilitate the development of industries, in 
particular manufacturing, agro- processing, and agriculture, as pertain to this notification. 
  An application is made to the Minister res ponsible for industry, by or on behalf of the 
enterprise, stating:    
- the locality or proposed locality of the factory;   
- the construction day;   
- the production day;   - the approved product already being manufactur ed or intended to be manufactured;  
and 
- all information relevant to dete rmine the local value added.   
 
 If the Minister is satisfied that it is in the pub lic interest to grant such  enterprise incentives, he 
may by Order published in the Gazette declare the en terprise to be an approved enterprise with effect 
from the date specified in the Order.   The relief from taxes, or "tax holiday period", is granted on import duties, income tax and 
export profits, depending on the group in which the enterprise is categorized. 
  There are five groups of enterprises and the tax holiday applicable is as follows:    
- Group I Enterprise, one in which the local value added is at least fifty per centum 
(50 per cent) of the amount realized from the sale of an approved product; up to 
15 years relief; 
 G/SCM/N/243/GRD 
Page 6  
 
  - Group II Enterprise, one in which the local  value added is be tween 25 per cent and 
50 per cent, up to 2 years; 
 - Group III Enterprise, one in which the local  value added is between 10 per cent and 
25 per cent, up to 10 years; 
 
- Enclave Enterprise, one in which production is  exclusively for export;  up to 15 years;  
and 
 - Highly capital intensive industr y, one in which the capital investment is not less than 
US$25 million, up to 15 years. 
 
 Export profits is determined by the form ula E x P where "E" represents proceeds from
    S 
export sales, "P" represents profits made by the enterp rise and "S" represents the proceeds of all sales.   
 
 Tax relief on export profits is as follows:    
Amount of export profits expressed as a 
Percentage of the entire profits Maximum  percentage of tax relief  
10% or more but less than 21% 25% 
21% or more but less than 41% 35% 
41% or more but less than 61% 45% 
61% or more 50% 
 
7. Subsidy per unit, or in cases where this is not possible, the total amount or the annual amount 
budgeted for that subsidy 
 
 Due to the nature and coverage of the progra mme, there are no statistical data available on the 
amount of subsidy per unit.  There is no annual amount budgeted for this programme.  
 
8. Duration of subsidy and/or any other time  limits attached to it, including date of 
inception/commencement 
 
 As indicated in 6 above. 
 9. Statistical data permitting an assessment of the trade effects of the subsidy is 
 
 Statistical data not available. 
 
B. DESCRIPTION OF DOMESTIC PROCEDURES NECESSARY TO ELIMINATE EXPORT SUBSIDY  
 The Fiscal Incentives Act has to  be repealed. The Investment Promotion Act 22 of 2009 
repeals the Fiscal Incentives Act. This Ac t will be enacted by the ending of 2012. 
 
C. DESCRIPTION OF ACTIONS TAKEN  
 At present there are no beneficiaries of export s ubsidies, therefore there were no beneficiaries 
to notify in Grenada.   G/SCM/N/243/GRD 
 Page 7 
 
 
   In August 2008, Government of Grenada undertook to review its investment policy in 
particular, a review of legislation pertaining to fiscal incentive programmes including those notified to 
the WTO and the plan of action for implementing the decision in the extension of Article 27.4 programmes.  
 In May 2009, the Investment Promotion Bill was completed.  The Grenada Investment 
Promotion Act has been passed through Parliament  and signed by the Governor General and is 
awaiting the completion of the incentives regime before being published in the National Gazette.  
Grenada estimates that the Act will come into effect by the end of 2012.  
D. D
ESCRIPTION OF FUTURE ACTIONS  
 New legislation has been passed through parlia ment and has been assented by the Governor 
General.  The development of a new incentive regi me is to be completed by 31 December 2012. 
Grenada's new investment policy is to be legislat ed by an act of parliament to be known as the 
Grenada Investment Promotion Act.  The Act will repeal and replace the Fiscal Incentives Act (1974), 
the Qualified Enterprises Act (1978), The Investment  Code Incentive Act (1983) and the Hotels Aid 
Act (1960).  The Act is intended to remove all export  subsidies and to provide an efficient, effective 
and transparent system for administering i nvestment incentives and concessions and for the 
non-discriminatory treatment of investors.   
III. QUALIFIED ENTERPRISES ACT NO. 18 OF 1978 
A. DESCRIPTION OF THE PROGRAMME  
1. Title of the subsidy progra mme, if relevant, or brief descr iption or identification of the 
subsidy 
 
 An Act to provide for the conferment of tax benefits on certain enterprises if the Minister 
responsible for industry considers it to be in the public interest to do so.   
 2. Period covered by the notification 
  As of 1 July 2011-30 June 2012 – programme status.   
 
3. Policy objective and/or purpose of the subsidy 
 
 To provide tax benefits  and exemptions to industries which can contribute to the promotion of 
economic growth and development of Grenada.    
4. Background and authority for the subsidy (inc luding identification of the legislation under 
which it is granted) 
 
Background 
  This Act was introduced to provide tax stabili zation to industries, which the Fiscal Incentives 
Act does not provide.  An order under this Act is  in addition to, and does not derogate from any 
benefit or advantage or similar concession enjoyed or to be enjoyed by an enterprise under any other 
written law.     This Act was implemented to ensure that wher e there is a tax increase, industries enjoying 
concessions for a particular period under the Fiscal Incen tives Act, will not be affected, as their rate of 
taxes and duties will remain at the same as on the da y an Order under this Act comes into effect.   G/SCM/N/243/GRD 
Page 8  
 
   Since Grenada's initial notification in Dece mber 2001, no modification was made to the 
Qualified Enterprises Act No. 18/1978 according to paragraph 4 of document G/SCM/39.   
 Authority 
 
 Qualified Enterprises Act No. 18 of 1978, Chapter 270 of the 1990 Revised Laws of Grenada.   
  The Grenada Industrial Development Corporati on (GIDC) is responsible for administering 
this incentive programme.    
5. Form of subsidy 
 
 The Qualified Enterprises Act provides for tax benefits and exemptions on taxes, duties and 
imposts payable by an Approved Enterprise at a ra te or amount not exceeding that subsisting on the 
date of the Order.   
 
6. To whom and how the subsidy is provided 
  This subsidy is available to all enterprises, but is rarely used.  At present only the three 
enclave enterprises established in Gren ada benefit under this Act.   
 
 A Qualified Enterprise enjoys such tax benefits  and exemptions as under the Fiscal incentives 
Act No. 41 of 1974, for up to 15 years at the rate subsisting on the date of the Order.     An approved enterprise under the Fiscal incentives Act No. 41 of 1974 may make an application to the Minister responsible for Industry, providing information as indicated in 6 of 
Programme II.   If the Minister is satisfied it is in the pub lic interest to, he may by Order under this 
Act, declare the approved enterprise to also be a Qualified Enterprise.   
 7. Subsidy per unit, or in cases where this is not possible, the total amount or the annual amount 
budgeted for that subsidy 
 
 Due to the nature and coverage of the progra mme, there are no statistical data available on the 
amount of subsidy per unit.  Also no annua l amount is budgeted for this programme.   
 8. Duration of subsidy and/or any other time lim its attached to it, including date of inception/ 
commencement 
 
 As indicated in 6  above.   
 9. Statistical data permitting an assessmen t of the trade effects of the subsidy 
 
 There is no such statistical information available.   
 
B. DESCRIPTION OF DOMESTIC PROCEDURES NECESSARY TO ELIMINATE EXPORT SUBSIDY  
 The Qualified Enterprise Act has to be rep ealed.  The new Investment Promotion Act 22 
of 2009 repeals the Qualified Enterprise Act.  Th is Act will be implemented by the end of 2012. 
 
C. DESCRIPTION OF ACTIONS TAKEN  
 At present there are no beneficiaries of export s ubsidies, therefore there were no beneficiaries 
to notify in Grenada.  G/SCM/N/243/GRD 
 Page 9 
 
 
   In August 2008, Government of Grenada undertook to review its investment policy in 
particular, a review of legislation pertaining to fiscal incentive programmes including those notified to 
the WTO and the plan of action for implementing the decision in the extension of Article 27.4 programmes.  
 In May 2009, the Investment Promotion Bill was completed.  The Grenada Investment 
Promotion Act has been passed through Parliament  and signed by the Governor General and is 
awaiting the completion of the incentives regime before being published in the National Gazette.  
Grenada estimates that the Act will come into effect by the end of 2012.  
D. D
ESCRIPTION OF FUTURE ACTIONS  
 New legislation has been passed through par liament and has been assented by the Governor 
General.  The development of a new incentive regi me is to be completed by 31 December 2012. 
Grenada's new investment policy is to be legislat ed by an act of parliament to be known as the 
Grenada Investment Promotion Act.  The Act will repeal and replace the Fiscal Incentives Act (1974), 
the Qualified Enterprises Act (1978), The Investment  Code Incentive Act (1983) and the Hotels Aid 
Act (1960).  The Act is intended to remove all export  subsidies and to provide an efficient, effective 
and transparent system for administering i nvestment incentives and concessions and for the 
non-discriminatory treatment of investors.   
__________