BANGLADESH

SUBSIDY PROGRAMS: GENERAL
Last Reviewed December 31, 2000

Effective February 15, 2000, Import Administration began publishing "Decision Memos" to reduce the size of antidumping and countervailing duty Federal Register notices. In cases in which a decision memo was published, you will find a link to the memo listed below.

In addition, in the following programs, in instances below in which a proceeding was a Sunset Review, you will see the letters SR after the product name.

COUNTERVAILABLE SUBSIDY PROGRAMS

The subsidy programs listed below have been investigated by the Department and have been found to be "countervailable" in the cases listed and during the periods reviewed based on the criteria established in the Tariff and Trade Act of 1930, as amended. Please refer to this Act for further detail of the criteria applied. In addition, you may click on the cases listed below the subsidy program title for a full explanation of the Department's analysis in those cases.

Concessional Export Credit Financing

Shop Towels (1990) 56 FR 15330 (4/16/91-prelim);   56 FR 29941 (7/1/91-final)

Under this program, the Banking Control Department (BCD) of Bangladesh Bank, the central bank of Bangladesh, sets interest rates for a particular period of time and creates bands of interest rates for preferential and commercial financing. Because only exporters are eligible for these loans, they are countervailable.

GOB Equity Infusion Converted Into An Interest-Free Loan

Shop Towels (1990) 56 FR 15330 (4/16/91-prelim);   56 FR 29941 (7/1/91-final)

On March 26, 1972, Eagle Star was nationalized by the GOB. On June 30, 1983, when the government still owned the company, it made a capital investment of 781,000 taka into the company. The GOB returned the company to its original owners under an agreement dated June 1, 1985. The agreement specifies that the capital investment of 781,000 taka would be treated as a loan to the company to be paid within nine years, at an interest rate determined by the government. No interest was charged to the company. We determined that there was no evidence that this program was not limited to a specific industry or enterprise or group of industries or enterprises. Therefore, we determine that it is countervailable to the extent that it was made on terms inconsistent with commercial considerations.

Export Performance Benefit

Shop Towels (1990) 56 FR 15330 (4/16/91-prelim);   56 FR 29941 (7/1/91-final)

This program compensates exporters for the overvaluation of the domestic currency, by allowing them to exchange a portion of their export earnings at a rate calculated by subtracting the difference between the official rate and the Secondary Exchange Market (SEM) rate from the official rate. We determine that this program provides a countervailable benefit to the companies to the extent that it provides an overpayment of beyond what should have been paid to equalize the exporter's exchange rates for imports and exports.

Income Tax Holiday

Shop Towels (1990) 56 FR 15330 (4/16/91-prelim);   56 FR 29941 (7/1/91-final)

Under Section 45 of the Income Tax Ordinance, 1984, producers who create a new manufacturing operation are eligible for an exemption from income taxes. The number of years a company may benefit from this program differs by region, with the lesser developed areas having a longer time of exemption. For this reason, the program is countervailable.

SUBSIDY PROGRAMS FOUND TO BE NOT COUNTERVAILABLE

The subsidy programs listed below have been investigated by the Department and have been found to be "not countervailable" in the cases listed and during the periods reviewed based on the criteria established in the Tariff and Trade Act of 1930, as amended. Please refer to this Act for further detail of the criteria applied. In addition, you may click on the cases listed under the subsidy program title for a full explanation of the Department's analysis in each case where the subsidy program has been examined.

Concessional Duty Treatment Under the Indigenous Raw Materials Provision of S.R.O. 282

Shop Towels (1990) 56 FR 15330 (4/16/91-prelim);   56 FR 29941 (7/1/91-final)

Under Number Six, Part (i) of the "Export Policy 1989-1991," the GOB offers industries concessional import duties on capital machinery. This program, administered by the Ministry of Finance, is designed to help industries modernize or improve their plant facilities. In the first half of the review period, the duty rates on capital machinery varied between 2.5 percent and 15 percent. Statutory Rules and Orders, dated July 25, 1990 (S.R.O. 282/L.1318/Cus.), revised the rate of duty to ten percent. Concessional duty treatment under the indigenous raw material provision is open to a large number and wide variety of industries. Because receipt of concessional duty treatment under the indigenous raw material provision of S.R.O. 282: (1) is not contingent upon export performance and (2) is not limited to an enterprise or industry or group of enterprises or industries, we determine that this provision does not confer a bounty or grant on manufacturers, producers, or exporters in Bangladesh.

SUBSIDY PROGRAMS DETERMINED NOT TO EXIST

The following subsidy programs were alleged by the petitioning industries and were investigated by the Department. However, during the investigation we found no evidence that such programs actually existed. If you click on the cases listed under the subsidy program title, you will be linked to each case in which the subsidy program was referenced. It is possible that, while the program named did not exist, a similar program having a different name actually was investigated. If this is the case, you will find that program listed elsewhere in this library.

Rebates On Insurance Premiums

Shop Towels (1990) 56 FR 15330 (4/16/91-prelim);   56 FR 29941 (7/1/91-final)

This program provides for rebates on insurance premiums; however, it has never been put into effect.

SUBSIDY PROGRAMS THAT HAVE BEEN TERMINATED

The subsidy programs listed below have been investigated by the Department and have been found to have been terminated based on the criteria established in the Tariff and Trade Act of 1930, as amended. Please refer to this Act for further detail of the criteria applied. In addition, you may click on the cases listed below the subsidy program title for a full explanation of the Department's analysis in each of these cases.

No programs are listed.

SUBSIDY PROGRAMS THAT HAVE NOT BEEN USED

When potential subsidy programs are investigated and found not to be used by the companies being investigated, the Department makes no determination as to their countervailability. If you click on the cases listed under the subsidy program title, you will be linked to each case in which the subsidy program was referenced.

Cash Assistance For Exports

Shop Towels (1990) 56 FR 15330 (4/16/91-prelim);   56 FR 29941 (7/1/91-final) not used

Under Number 13 of the "Export Policy 1989-1991," the government offers importers three options to ensure that exporters can procure necessary raw materials at world market prices: 1) a duty-free importation of raw materials utilizing a bonded warehouse arrangement; 2) use of a duty drawback facility; and, 3) cash assistance in lieu of the bonded warehouse or duty drawback facility. Importers may only take advantage of one of these three options.

Concessional Duty Treatment For Exporters Under the Export Provision or S.R.O. 282

Shop Towels (1990) 56 FR 15330 (4/16/91-prelim);   56 FR 29941 (7/1/91-final) not used

Under Number Six, Parts (i) and (iv) of the "Export Policy 1989-1990," the GOB offers industries concessional import duties on capital machinery and duty-free entry of samples for the handloom sector.

Income Tax Rebates

Shop Towels (1990) 56 FR 15330 (4/16/91-prelim);   56 FR 29941 (7/1/91-final) not used

Under Number Seven of the "Export Policy 1989-1991," the Government of Bangladesh offers exporters income tax rebates contingent upon individual export performance. This program, administered by the National Board of Revenue, is available to exporters of non-traditional products and other companies as the Board may designate.

Import Duty Exemption For Companies Located in an Export Processing Zone

Shop Towels (1990) 56 FR 15330 (4/16/91-prelim);   56 FR 29941 (7/1/91-final) not used

Industrial undertakings in an Export Processing Zone (EPZ) are eligible for a ten-year exemption from taxes beginning with the first month the business commences. After ten years, the income tax holiday is converted into a 50 percent tax rebate on export sales. This tax holiday is not limited to an enterprise or industry or group of enterprises or industries. However, the number of years a company may receive benefits from this program is based on the region in which it is located. Therefore, we determine that this program confers a bounty or grant to the extent that shop towel producers located in a lesser developed area, least developed area, in an EPZ, are allowed a longer income tax holiday than producers located in a more developed region.