WORLD TRADE  
ORGANIZATION  G/SCM/N/155/MUS 
G/SCM/N/160/MUS 5 June 2007 
 
(07-2313) 
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  
 
Extension Under SCM Article 27.4 of the Transition Period for the  
Elimination of Export Subsidies Pursuant to the Procedures  
in Document G/SCM/39  
 
Updating Notification  
 
MAURITIUS 
  
 The following communication, dated 30 May 2007, is being circulated at the request of the 
Delegation of Mauritius. G/SCM/N/155/MUS 
G/SCM/N/160/MUS Page 2 
 
 
  1. 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 2006 – June 2007  3. Policy objective
 
 
 To promote and 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 the 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 Free port 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/155/MUS 
 G/SCM/N/160/MUS 
 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 2006 – June 2007. 
 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).  Provision made for the repeal of the tax 
exemption by way of the Finance Act 2006 (Section 18 (zze) (iii)).  Effective on 1
st July 2009.   
 
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 Developers wh ich are engaged in processing (licensed on or 
before 1 June 2002) and those enga ged in light assembly, ship building, repairs and maintenance.   
 
7. Subsidy per unit or Total amount
 
  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
 
 
 This incentive has contributed to the development of the Mauritius Freeport.  Freeport generated a total trade turnover to Rs. 30.2 billion for the financial year ending 30 June 2004.   G/SCM/N/155/MUS 
G/SCM/N/160/MUS Page 4 
 
 
  2. EXPORT PROMOTION 
 
1. Title of the Subsidy Programme
 
 
 Export Promotion 
  Description of the scheme  Income Tax Credit  
2. Period covered by the notification
 
  June 2006 – June 2007  3. Policy objective
 
 
 To encourage enterprises traditionally geared to wards the domestic market to diversify into 
export markets.    4. (a) Background authority for the scheme
 
 
  Income Tax Department.   
  (b) Legal basis
 
   Income Tax Act 1995 (Sections 71 and 72)  and Income Tax (Amendment No. 2) 
Regulations 2000.  Repeal of Income Tax Cred it for export by way of the Finance Act 2006 
(Section18(w)).  Effective on 1
st July 2007.   
 5. Form of Subsidy
 
  Tax credit allowed by way of deduction from income tax otherwise payable by the company, 
the credit being determined by the percentage of qua lifying export sales to total turnover, and limited 
such that the rate of income tax payable after the tax credit does not fall below 15 per cent.   
 6. Beneficiaries
 
 
 Any company engaged in the export of goo ds and services which is not a tax incentive 
company.    7. Subsidy per amount or total amount
 
  Negligible.   
 
8. Duration of the subsidy
 
  The scheme is not limited in time.    
9. Assessment of trade effects
 
  Almost all manufacturing and service enterprises (except trading and financial services) are subject to a rate of corporate tax of 15 per cent and are therefore not eligible to the export credit.   
  G/SCM/N/155/MUS 
 G/SCM/N/160/MUS 
 Page 5 
 
 
   The scheme has become virtually inoperativ e and its trade effects insignificant.   
 
3. EXPORT ENTERPRISE SCHEME 
 1. Title of the Subsidy Programme
 
  Export Enterprise Scheme   Description of the scheme 
 Customs and excise duty exemption 
 2. Period covered by the notification
 
  June 2006 – June 2007 
 
3. Policy objective
 
  To promote investment in EPZ sector.    4. (a) Background authority for the scheme
 
 
  The Board of Investment, Ministry of Finance and the Customs & Excise 
Department.   
  (b) Legal basis
 
 
  Industrial Expansion Act 1993.  Repeal of  the Industrial Expansion Act by way of 
Finance Act 2006 (Section 33).  Effective as from 1st October 2006.   
 5. Form of Subsidy
 
 
 Exemption from customs duty and excise duty on scheduled equipment.   
 6. Beneficiaries
 
  Holders of an Export Enterprise Certificate.   
 [Export Processing Zone (EPZ) companies].   
 7. Subsidy per amount or total amount
 
  Marginal.    
8. Duration of the subsidy
 
  The scheme is not limited in time.    9. Assessment of trade effects
 
 
 Negligible.    G/SCM/N/155/MUS 
G/SCM/N/160/MUS Page 6 
 
 
  4. PIONEER ENTERPRISE SCHEME 
 
1. Title of the Subsidy Programme
 
 
 Pioneer Enterprise Scheme 
  Description of the scheme  Customs and excise duty exemption  
2. Period covered by the notification
 
  June 2006 – June 2007  3. Policy objective
 
 
 The scheme aims at promoting investment in higher technology and encourage the creation of 
more sophisticated support industries and services.    4. (a) Background authority for the scheme
 
 
  The Board of Investment and the Customs and Excise Department.   
  (b) Legal basis
 
   Industrial Expansion Act 1993.  Repeal of  the Industrial Expansion Act by way of 
Finance Act 2006 (Section 33).  Effective as from 1
st October 2006.   
 5. Form of Subsidy
 
  Exemption from customs duty and excise duty on scheduled equipment.    
6. Beneficiaries
 
  Holders of a Pioneer Status Enterprise Certificate.    7. Subsidy per amount or total amount
 
 
 Negligible.    8. Duration of the subsidy
 
  The scheme is not limited in time.   
 
9. Assessment of trade effects
 
  Pioneer Status Enterprises cater mostly for th e local market and therefore trade effects are 
insignificant.   
 
 
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