Frequently Asked Questions about the Mariel Special Development Zone
The Investor’s Guide of the Mariel Special Development Zone (ZED) was presented to businesspeople from Cuba and abroad at the Havana International Fair. The guide is a portfolio that explains tax regulations, prioritized projects, legal framework, infrastructural conditions, and the Zone’s development strategy. Chapter 23 of the Guide contains some FAQs.
Is the ZED Mariel a Free Trade Zone?
No. The area of ZED Mariel is considered part of Cuban national territory. There are no restrictions governing the sale or purchase of goods and / or services between companies operating within ZED Mariel and other areas of Cuba (although there may be some regulatory or taxation differences). Practically there is no fence around the area of ZED Mariel and no customs restrictions between goods entering or leaving ZED Mariel from / to other areas of Cuba.
Raw materials that are processed in ZED Mariel will be subject to the same customs duties as a facility located in another part of Cuba, except in cases of export sales (see below).
Can customs duties be reclaimed for export sales?
Yes. Capital goods and machinery (the investment cost) are fully exempt from any customs duties regardless of destination of sales. A process will also be established through which it may be possible to negotiate a rebate on customs duties paid for raw materials corresponding to the proportion of sales made outside of Cuba.
Can sales of goods be made to the domestic market?
Yes. There is no specified percentage of exports that a company located in ZED Mariel must take. Theoretically, a company could make 100 % of its sales its sales to the domestic Cuban market. The projected distribution of sales domestically and internationally should be included in the feasibility study presented to the Office of ZED Mariel. Only government corporations currently carry out retail commerce in Cuba.
Will service companies based in ZED Mariel be able to provide services to the Cuban domestic market?
Yes. Tax benefits provided to users of ZED Mariel will be applied on sales made outside of ZED Mariel to the rest of Cuba.
Will it be possible to establish a bonded warehousing facility in ZED Mariel to service the Cuban market?
No. ZED Mariel is intended to be a productive area where value added is added to inputs whether through assembly, manufacturing or processing. As part of Cuban national territory, customs duties must be paid at the point when goods enter the area.
What is the contribution to the Zone’s Development Fund?
The contribution to the Zone’s Development Fund is the way in which concession holders and users contribute a percentage of their income (and in the absence of income, a fixed fee) to the formation of a fund for the maintenance of the Office and the Zone’s common areas.
The contribution is established in Article 44 of Decree Law No. 313 and is implemented through Resolution No. 384 / 2013 of the Ministry of Finance and Prices.
This non-tax contribution is made through quarterly payments of 0.5 % of the gross income earned in each quarter in the concession holders’ and users’ operational currency. If concession holders and users do not earn any income during a fiscal year, they will make an annual contribution to the Fund in the amount of 600 Cuban Convertible Pesos (CUC) or 600 Cuban Pesos (CUP) if they operate only in the latter currency.
