WORLD TRADE  
ORGANIZATION  G/SCM/N/155/GTM 
9 July 2009 
 (09-3370) 
Committee on Subsidies and 
Countervailing Measures Original:   Spanish 
 
 
 
SUBSIDIES 
 
New and Full Notification Pursuant to Article XVI.1 of the GATT 1994 and  
Article 25 of the Agreement on S ubsidies and Countervailing Measures  
 
GUATEMALA 
   The following communication, dated 6 July 2009, is being circulated at the request of the 
delegation of Guatemala. 
 
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  Pursuant to Article XVI.1 of the General Ag reement on Tariffs and Trade (GATT) 1994 and 
Article 25 of the Agreement on Subsidies and Count ervailing Measures (hereinafter referred to as the 
"Agreement on Subsidies"), Guatemala hereby presents a new and full notification for 2007. 
 G/SCM/N/155/GTM 
Page 2  
 
  TABLE OF CONTENTS 
 
   Page  I Exemption from Company Tax;  exemption from customs duties and other import 
taxes, including Value-Added Tax (VAT), on im ports of machinery, equipment, parts, 
components and accessories required for the production process of companies under special customs regimes…......................................................................................…... 2 
 II Exemption from Company Tax;  exemption from customs duties and other import 
taxes, including Value-Added Tax (VAT), on im ports of machinery, equipment, parts, 
components and accessories required for the production process relating to activities of managers and users of Free Zones................................................................................ 3 
 III Exemption from Company Tax;  exemption from customs duties and other import 
taxes, including Value-Added Tax (VAT), on im ports of machinery, equipment, parts, 
components and accessories required for the production process of commercial and industrial enterprises operating in the Industrial and Trade Free Zone (ZOLIC)...……................................................................................................................ 4 
  PROGRAMME I
 
 
1. Description 
 
(a) Exemption from Company Tax on income from the export of goods produced or 
assembled in Guatemala and exported under special customs regimes to non-Central 
American countries. 
 
(b) Exemption from customs duties and other import taxes, including Value-Added Tax 
(VAT), on imports of machinery, equipment, parts, components and accessories required for the production process. 
 
2. Period of notification 
 
 June 2007.  3. Objective 
 
 To promote, encourage and develop the produc tion in the national customs territory of goods 
for export to non-Central American countries.  
4. Background and authority 
 
 Background
: 
  The Government of Guatemala considers th at appropriate conditions for encouraging 
investment of national and foreign capital need to  be promoted in order to reduce the high poverty 
levels stemming, inter alia , from the internal armed conflict as we ll as to raise employment levels and 
improve the distribution of income.   G/SCM/N/155/GTM 
 Page 3 
 
 
   Authority : 
  Legislative Decree No. 29-89 of 23 May 1989.  
5. Form of the subsidy 
 
 The subsidy takes the form of a tax exemption, but its effect is greatly reduced given the other 
national taxes payable.  
6. To whom and how the subsidy is provided 
 
 The subsidy is granted to companies by wa y of an exemption from Company Tax on income 
from the export of goods produced or assembled in  Guatemala and exported under special customs 
regimes to non-Central American countries.  
 To be eligible for the programme, companies must be recognized by the Ministry of the 
Economy.  
7. Subsidy per unit or, in cases where this is  not possible, the total or annual amount 
budgeted for this subsidy 
  Subsidies are granted in acco rdance with the exporters' inco me;  they cannot therefore be 
quantified given that they vary each fiscal year.  
8. Duration of the subsidy and/or any other time-limit which could affect it, including the 
date of inception/commencement 
 
 This subsidy programme is applicable for up to ten years.  
9. Statistical data 
 
 No such statistical information is available. 
 
 
PROGRAMME II
 
 
1. Description 
 
(a) Exemption from Company Tax on income ex clusively from the activities of managers 
and users of the Free Zone. 
 
(b) Exemption from customs duties and other import taxes, including Value-Added Tax 
(VAT), on imports of machinery, equipment, parts, components and accessories 
required for the production process. 
 
2. Period of notification 
 
 June 2007. 
 G/SCM/N/155/GTM 
Page 4  
 
  3. Objective 
 
 To promote and regulate the establishment in  Guatemala of Free Zones, the activities of 
which, in particular measures to boost foreign tr ade, create employment and stimulate technology 
transfer, serve to encourage national development. 
 
4. Background and authority 
 
 Background
: 
 
 In an endeavour to encourage the development of regions which have been marginalized as a 
result of the internal armed conflict and to re duce poverty levels, a Free Zone system has been 
established as an instrument to create employme nt, attract investment and encourage technology 
transfer.  
 Authority
: 
  Legislative Decree No. 65-89 of 14 November 1989.  
5. Form of the subsidy 
  The subsidy takes the form of a tax exemption. 
 
6. To whom and how the subsidy is provided 
 
 The beneficiaries of this incentive are the managers and users of Free Zones. 
 
 To enjoy these fiscal benefits, companies must be fully authorized by the Ministry of the 
Economy.  
7. Subsidy per unit or, in cases where this is  not possible, the total or annual amount 
budgeted for this subsidy 
 
 Subsidies are granted in acco rdance with the exporters' inco me;  they cannot therefore be 
quantified given that they vary each fiscal year.  
8. Duration of the subsidy and/or any other time-limit which could affect it, including the 
date of inception/commencement 
 
 This subsidy programme is applicable for up to ten years.  
9. Statistical data 
  No such statistical information is available. 
  
PROGRAMME III
 
 
1. Description 
 
(a) Exemption from Company Tax on income from the activities of managers and users 
of the Industrial and Trade Free Zone (ZOLIC).  G/SCM/N/155/GTM 
 Page 5 
 
 
  (b) Exemption from customs duties and other import taxes, including Value-Added Tax 
(VAT), on imports of machinery, equipment, parts, components and accessories required for the production process. 
 
2. Period of Notification 
 
 June 2007.  
3. Objective 
  To promote the economic development of the province of Izabal, where the population - 
mostly Garifuna - is the most backward in the c ountry in terms of social and economic development, 
and capitalize on its geographical location as the sole  access point to Guatemala from the Atlantic 
Ocean.  4. Background and authority 
 
 Background
: 
  Measure to encourage investment as a me chanism for promoting the development of 
Guatemala's Garifuna population. 
 
 Authority
: 
  Decree No. 22-73 of 21 March 1973.  5. Form of the subsidy 
 
 The subsidy takes the form of a tax exemption.  
6. To whom and how the subsidy is provided 
  The beneficiaries of these incentives are comme rcial and/or industrial enterprises operating 
under this special regime.  
7. Subsidy per unit or, in cases where this is  not possible, the total or annual amount 
budgeted for this subsidy 
 
 Subsidies are granted in accordance with the bene ficiaries' income;  they cannot therefore be 
quantified given that they vary each fiscal year.  
8. Duration of the subsidy and/or any other time-limit which could affect it, including the 
date of inception/commencement 
 
 This subsidy programme is applicable for up to ten years.  
9. Statistical data 
  No such statistical information is available. 
  
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