. /.   WORLD TRADE  
ORGANIZATION  G/SCM/Q2/TUR/24 
3 August 2010 
 (10-4124) 
Committee on Subsidies  
and Countervailing Measures Original:   English 
 
 
 
SUBSIDIES 
 
Questions from the UNITED STATES Regarding the   
New and Full Notification of TURKEY1 
 
  The following communication, dated 2 August 2010,  is being circulated at the request of the 
Delegation of the United States.  
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I. INVESTMENT ENCOURAGEMENT PROGRAM IN TURKEY 
1. Turkey has revised its Investment Encourag ement Program (IEP) since the last notification 
in 2007.  In order to receive an Investment Enc ouragement Certificate, investors must obtain approval 
"on the basis of macro-economic programs, supply vs. demand conditions, and sectoral, financial and 
technical terms," among other very general criteria.  Could Turkey please provide further detail as to 
the eligibility criteria for companies to  benefit from this program in its current iteration?  In particular, 
please describe any new or changed e ligibility criteria that companies mu st satisfy in order to receive 
benefits. 
 
2. Turkey notes various Encouragement M easures, from which investors who hold IE 
Certificates may benefit, including Exemption fro m Customs Duties, Value Added Tax Exemption, 
Tax Reduction, Social Security Premium Support, Interest Support, and Land Allocation.  Could 
Turkey please explain whether the eligibility criteri a differ based on the particular "Encouragement 
Measure" at issue?  If so, please describe in furthe r detail the applicable criteria for each measure. 
 
II. FREE ZONES 
1. According to the Secretariat report for Turk ey's most recent Trade Policy Review (TPR), 
Turkey provides various incentives to companies operating in twenty free zones.  These include, inter 
alia, exemptions from income, corporate and value-a dded taxes, and exemptions from customs duties 
and fees, as well as attractive terms for the rental of facilities.  The legislation authorizing the free 
zones is designed to, inter alia , promote joint-ventures in export-oriented enterprises, provide easy 
access to imports of raw materials on favourable terms, and promote foreign direct investment.   According to Turkey's replies to Member's ques tions, free zone benefits "are available to all 
companies, regardless of regional specification or industrial designation".  However, we note that it 
appears that incentives under these programs are provide d to export-oriented enterprises, which raises 
issues under Article 3 of the Subsidies Agreemen t.  Could Turkey please explain further the 
application process and the eligibility criteria for its free zone program? 
                                                     
 
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  2. According to the TPR Report, Turkey's Technology Development Zones Law (No. 4691) 
provides incentives to promote the u se of high/advanced technologies.  Given the limited availability 
of this program, could Turkey please discuss why this  program was not included in its notification? 
 
III. EXPORT SUBSIDY PROGRAMME FOR AGRICULTURAL PRODUCTS 
1. According to the notification, the Export Subsidy Programme for Agricultural Products aims 
to develop Turkey's export potential in processed  agricultural products.  Please describe how this 
program is consistent with Turkey's obligations  under Article 3 of the Subsidies Agreement. 
  
 
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