RESTRICTED
WORLD TRADE G/TRIMS/N/1/DOM/1
10May1995
ORGANIZATION(95-1222)
Original: Spanish Committee onTrade-Related Investment Measures
NOTIFICATION UNDER ARTICLE 5.1OFTHE AGREEMENT
ONTRADE-RELATED INVESTMENT MEASURES
Dominican Republic
Theattachedcommunication,dated26April1995,hasbeenreceivedfromthePermanentMission
oftheDominican Republic.1
_______________
1Thereplies inthisnotification follow theorder oftheagreed format fornotifications under Article 5.1,
contained indocument G/TRIMS/1.
2CopiesofthesedocumentsareavailableintheSecretariatforinspectionbyinteresteddelegations(Intellectual
Property andInvestment Division).G/TRIMS/N/1/DOM/1
Page2
(i) Description ofthemeasure andofitsmain features.
1. Illustrative Category: 1(a) Law No.69onpromotion ofnon-traditional exports
establishes inArticle 2,paragraph 3,thattheCODOPEX Management Council shall
notauthorize thetemporary import ofinputs thatareexempted from customs duties
where such inputs areproduced inquantity andquality andatprices thatare
competitive withtheforeign product.
2. Application oftheTRIM: Themeasure isapplied under mandatory legislation.
3. TheTRIM andthecriteria fordetermining itsapplication: Itisbased onthe
analysis ofthecompetitiveness oftheimported input compared withthelocal product,
which isdetermined onthebasis ofinternational prices andlocalproduct prices, aswell
asother factors concerning product supply andquality.
4. Requirement fornewenterprises ornewinvestments ofexisting enterprises: Thisis
ageneral measure thatcovers allenterprises andinvestments.
5. Compliance withtheTRIM: Enterprises comply withthisprovision inorder toobtain
ataxexemption benefit.
6. Product specific details oftheTRIM: Only thecase ofcardboard andmetal
packagings hasarisen under LawNo.69.
7. Date ofimplementation: Although Law69isabout 15years old,arefusal occurred
forthefirsttime forcardboard packaging in1993. Even so,nophasing-down is
envisaged.
8. Law, regulation orguideline: Acopy ofLaw No.69of16November 1979 on
promotion ofnon-traditional exports isattached.2
9. Level ofgovernment applying theTRIM: Dominican Centre forExport Promotion
andDirectorate-General ofCustoms.
(ii) General information ontheprogramme inquestion: Theprogramme facilitates or
provides incentives fornon-traditional export sectors, through aninward-processing
system known astheTemporary Import Regime under which rawmaterials thatareto
beprocessed andsubsequently re-exported within 12months (oneyear) areexempted
from payment ofcustoms duties.
However, theLaw allows local producers ofinputs tocompete with theimported
product ifitcanbeshown thattheyareinfactcompetitive interms ofprice, quality
andefficiency inthesupply ofrequisite quantities.G/TRIMS/N/1/DOM/1
Page3
(i) Description ofthemeasure andofitsmain features.
1. Illustrative Category: 2(a)Thismeasure refers totheauthorization forasingle local
enterprise toimport leanporkshoulders inorder toproduce sausages provided thatthe
company alsopurchases thequantity of45,000 locally produced pigs(Order No.28016
of7/12/93).
TheExecutive Power issued Decree No.216/94 of5August 1994 tosupplement this
administrative measure. TheDecree grants powers totheSwine Commission ofthe
National Production Council (CONAPROPE), tocoordinate with other official
institutions thesupervision ofcompliance withtheagreements fortheimport andexport
ofpigmeat andproducts thereof.
2. Application oftheTRIM: Thismeasure wasadopted bytheAdministration owing to
theopposition ofthelocalpigproduction sector toanenterprise taking advantage ofthe
Temporary Import Regime forthequantity of2.3million lbs.of"lean porkshoulders"
forexport totheUnited States market intheform ofsausages.
Pork shoulders forexport require sound phytosanitary handling byaprocessing plant
approved bytheUnited States FDA, which iswhytheyhave tobeimported forthe
preparation ofthesausages.
Thegovernment decided tocombine imports withlocalpurchases ofwhole pigs.
3. TheTRIM andthecriteria fordetermining itsapplication: Thismeasure applies
exclusively toasingle enterprise, which forthetimebeing istheonlyenterprise that
canpenetrate theUnited States market with thestandards required bytheFDA;
consequently, itistheonlylocal enterprise covered bytheTemporary Import Regime
ofLawNo.69withrespect tosausages.
4. Requirement fornewenterprises ornewinvestments ofexisting enterprises: Sofar
thismeasure hasbeenexclusively applied toasingle enterprise.
5. Compliance with theTRIM: Theenterprise complies withthemeasure inorder to
obtain theadvantages ofLawNo.69.
6. Product-specific details oftheTRIM: Local purchase of45,000 units oflivepigsin
exchange fortemporarily duty-free import under LawNo.69ofsome 2.3million lbs.
ofleanporkshoulders.
7. Date ofimplementation: Themeasure entered intoforce on7December 1993 and
remains inforce without modification.
8. Phasing-down: There isnoprovision forphasing-down themeasure.
9. Law, regulation orguideline: Copies areattached ofCommunication No.28016 of
7/12/93 ofthePresident oftheDominican Republic andExecutive Decree No.216/94
of5August 1994.2
2CopiesofthesedocumentsareavailableintheSecretariatforinspectionbyinteresteddelegations(Intellectual
Property andInvestment Division).G/TRIMS/N/1/DOM/1
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10. Level ofgovernment applying theTRIM: Swine Commission oftheNational Council
forAgricultural Production (CONAPROPE), which administers ittogether with the
Ministry ofAgriculture.
(ii) General information ontheprogramme inquestion: ThisTRIM ispartofapolicy
fortheprotection oflocal pigfarmers whoatthetimereceived agovernment subsidy
forthepurchase ofpigsandwere affected bythefallindomestic prices owing to
surpluses andhighproduction costs.
Theauthorities provided forthepurchase of1.7million lbs.from associated producers
through thePrice Stabilization Institute (INESPRE), foravalue ofRD$10.2 million
during theperiod September-December 1993. Thiswasatemporary measure, andthis
subsidy programme doesnotexistatthepresent time.G/TRIMS/N/1/DOM/1
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(i) Description ofthemeasure andofitsmain features
1. Illustrative category: 1(b). Themeasure isasfollows: "Export totheterritory ofthe
Dominican Republic 100percentofthegoods and/or services anenterprise produces,
subject topayment of100percentoftheduties andtaxes established forsimilar
imports, provided oneofthefollowing conditions ismet:
1. Thattheproduct tobeexported isnotmanufactured outside theFreeZone in
theterritory oftheDominican Republic.
2. Thattheproduct tobeexported includes local components, thatistosaylocal
rawmaterials, accounting foratleast25percentofthetotal.
2. Application oftheTRIM: LawNo.8-90toPromote theEstablishment ofNewFree
Zones andExpand Existing Ones, of15January 1990, Article No.17,Section F.
3. TheTRIM andthecriteria fordetermining itsapplication: Allenterprises inFree
Zones inthecountry areaffected bythismeasure. Some 490enterprises operate in
these industrial zones.
4. Requirements fornewenterprises ornewinvestments with existing enterprises:
Themeasure applies toallexisting enterprises andnewinvestments toexpand them or
newprojects fortheestablishment ofenterprises.
5. Compliance with theTRIM: Themeasure ismandatory forallenterprises without
exception.
6. Products-specific details oftheTRIM: Itapplies toallproducts manufactured by
FreeZone enterprises.
7. Date ofimplementation: Theprovisions ofthismeasure entered intoforce on
15January 1990 withtheapplication oftheabove-mentioned Law.
8. Phasing-down: TheLawdoes notprovide forphasing-down orelimination ofthe
TRIM.
9. Law, regulation orguideline: AcopyofLaw8-90isattached.4
10. Level ofgovernment applying theTRIM: Theimplementing agency istheNational
Council forExport FreeZones, setupunder Executive Decree 895of19March 1983.
This isthegovernment body responsible forguiding development policy forthe
country 'sfreezones, andforadministering andregulating theprovisions ofLaw8-90
of15/01/90.
TheNational Council forExport FreeZones isattached totheMinistry ofIndustry and
Trade, which presides over theCouncil andthemeetings ofitsgoverning board.
Besides theMinistry, theother members oftheCouncil include theDirectors ofthe
Industrial Development Corporation andCEDOPEX, theChairman oftheInvestment
Promotion Council, theExecutive Director oftheNational Council forFreeZones, two
representatives ofthefree-zone enterprises, theGovernor oftheCentral Bank anda
member ofADOEXPO.
4CopiesofthesedocumentsareavailableintheSecretariatforinspectionbyinteresteddelegations(Intellectual
Property andInvestment Division).G/TRIMS/N/1/DOM/1
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(ii) General information ontheprogramme inquestion: Thefreezones were created in
anenvironment inwhich protectionism forlocal manufacturers prevailed. However,
thefreezones always enjoyed asystem oftaxincentives andcustoms andtaxfacilities
which paved thewayforstrong outward-looking growth ofthezones without an
anti-export bias.
Ontheother hand, while thedomestic sector iseffectively protected bythetariff,
owing tothedifficult economic environment itispractically unable tocompete withthe
freezone producers. Consequently, asawayofprotecting local manufacturers,
Law8-90included thepossibility ofselling inthenational territory products from free
zones thatinclude Dominican rawmaterials.