Goods Imported and Exported Refund and Drawback Regulations

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Goods Imported and Exported Refund and Drawback Regulations

SOR/96-42CUSTOMS TARIFF
Registration 1996-01-01
Regulations Respecting the Refund and Drawback of Duties Paid in Respect of Imported Goods Subsequently Exported, in Respect of Imported Goods Processed in Canada and Subsequently Exported and in Respect of Imported Goods Used, Consumed or Expended in the Processing in Canada of Goods Subsequently Exported
P.C. 1995-2250  1995-12-28His Excellency the Governor General in Council, on the recommendation of the Minister of National Revenue, pursuant to subsections 77(3)Footnote *, 79.4(3)Footnote ** and 80(3)Footnote ***, paragraph 95(1)(d)Footnote **** and subsections 100(3)Footnote ***** and (5)Footnote ***** of the Customs TariffFootnote ******, is pleased hereby to make the annexed Regulations respecting the refund and drawback of duties paid in respect of imported goods subsequently exported, in respect of imported goods processed in Canada and subsequently exported and in respect of imported goods used, consumed or expended in the processing in Canada of goods subsequently exported, effective on the day on which section 56 of An Act to amend the Customs Act and the Customs Tariff and to make related and consequential amendments to other Acts, being chapter 41 of the Statutes of Canada, 1995, comes into force.

Return to footnote *S.C. 1989, c. 18, s. 6
Return to footnote **S.C. 1989, c. 18, s. 7
Return to footnote ***S.C. 1995, c. 41, s. 47
Return to footnote ****S.C. 1995, c. 41, s. 55(1)
Return to footnote *****S.C. 1995, c. 41, s. 56
Return to footnote ******R.S., c. 41 (3rd Supp.)
Short Title

1 These Regulations may be cited as the Goods Imported and Exported Refund and Drawback Regulations.

Interpretation

2 In these Regulations,

Act
Act means the Customs Tariff; (Loi)
beer
beer means beer or malt liquor as defined in section 4 of the Excise Act; (bière)
Crown corporation
Crown corporation means a corporation named in Schedule II or Schedule III to the Financial Administration Act; (société d’État)
textile fabric
textile fabric means textile fibre, glass fibre, textile fabric, glass fabric or other textile product that is of a stage between textile fibre and fabric that is composed exclusively of fibres that fall within a class set out in Schedule I. (tissus textiles)

SOR/2003-237, s. 1.

PART I Drawback

Application

3 This Part applies in respect of the grant, under subsection 113(1) of the Act, of a drawback of the duties paid in respect of imported goods described in subsection 89(1) of the Act, other than goods in respect of which the Exported Motor Vehicles Drawback Regulations apply.
SOR/98-54, s. 3.

Circumstances in Which an Application for Drawback May Be Made

4 Subject to section 5, an application for a drawback may be made where

(a) in the case of goods described in paragraph 89(1)(a) of the Act, the goods were not damaged before being exported;

(b) in the case of exported goods described in any of paragraphs 89(1)(b) to (e) of the Act, the goods

(i) were not used in Canada before being exported for any purpose other than display or demonstration, and
(ii) were not damaged before being exported;

(c) in the case of imported goods described in paragraph 89(1)(d) of the Act, other than textile fabric, on which relief of duties would otherwise have been granted,

(i) the imported goods are processed in the plant in Canada in which the same quantity of domestic or imported goods of the same class was processed and subsequently exported, and
(ii) the exported goods were exported within two years after the date the imported goods were released;

(d) in the case of imported textile fabric described in paragraph 89(1)(d) of the Act on which relief of duties would otherwise have been granted,

(i) the imported textile fabric is processed into textile goods in a plant in Canada by the processor of textile goods who processed the same quantity of domestic or imported textile fabric of the same class that was subsequently exported, and
(ii) the exported textile goods were exported within two years after the date the imported textile fabric was released; and

(e) in the case of imported goods described in paragraph 89(1)(e) of the Act on which relief of duties would otherwise have been granted,

(i) the imported goods are directly consumed or expended in the processing of goods in the plant in Canada in which the same quantity of domestic or imported goods of the same class was directly consumed or expended in the processing of the exported goods, and
(ii) the exported goods were exported within two years after the date the imported goods were released.

SOR/98-54, s. 3.

5 An application for a drawback under this Part may be made where

(a) the goods were exported or deemed to have been exported before the application for drawback is made; and
(b) the applicant provides a waiver from all other persons entitled to claim a drawback, refund or remission of the duties, waiving their right to do so.

Prescribed Classes of Goods and Use

6 For the purposes of paragraph 89(3)(b) of the Act, the ships and aircraft described in Schedule II are prescribed as classes of ships and aircraft.
SOR/98-54, s. 3.

7 For the purposes of paragraph 89(3)(c) of the Act, the prescribed class of telegraph cable ships includes only those telegraph cable ships that are

(a) registered in any country;
(b) used exclusively for the laying and repairing of oceanic telegraph cables outside Canada; and
(c) proceeding on an ocean voyage outside Canada.

SOR/98-54, s. 3.

8 For the purposes of paragraph 89(3)(g) of the Act, goods are used or destined for use where they

(a) are purchased by the government of a NAFTA country or its authorized agent, by a department of the Government of Canada or by a Crown corporation acting on behalf of the government of a NAFTA country;

(b) are for use solely and exclusively in conjunction with

(i) a project undertaken jointly by the Government of Canada and the government of a NAFTA country, or
(ii) an undertaking, located in Canada, of the government of a NAFTA country; and

(c) are or will become the property of the government of a NAFTA country.

SOR/98-54, s. 3.

Persons Who May Claim a Drawback

9 (1) Subject to subsection (2), a drawback may be claimed by any person who is the importer or exporter of the imported or exported goods, or is the processor, owner or producer of those goods between the time of their direct shipment to Canada and their export or deemed export.
(2) In the case of the goods described in section 10, a drawback may be claimed only by the importer of the goods.

Time Limits for Applying for Drawback

10 In the case of spirits, wine, or beer that are imported goods described in paragraph 89(1)(b) of the Act on which the relief of duties would otherwise have been granted, an application for drawback shall be made within five years after the date on which the imported spirits, wine or beer were released.

SOR/98-54, s. 3;
SOR/2003-237, s. 2.

Goods of the Same Class

11 (1) Subject to subsection (2), for the purposes of paragraphs 89(1)(d) and (e) of the Act, domestic or imported goods shall be considered to be of the same class if the goods are so similar that they may be

(a) used interchangeably in the processing of goods in Canada; or
(b) directly consumed or expended interchangeably in the processing in Canada of goods.

(2) For the purposes of paragraphs 89(1)(d) and (e) of the Act, domestic and imported textile fabrics composed of different fibres shall be considered to be of the same class if the domestic and imported textile fabrics are composed of

(a) fibres that fall within one class set out in Schedule I; or

(b) fibres that do not fall within one class set out in Schedule I, if

(i) any particular class set out in that Schedule within which fall fibres of which the domestic textile fabric is composed

(A) is a class within which fall fibres of which the imported textile fabric is composed, or
(B) represents less than five per cent of the weight of the domestic textile fabric, and

(ii) the difference between the following proportions does not exceed 33 percentage points:

(A) the proportion, expressed as a percentage, that the aggregate weight of the fibres of which the domestic textile fabric is composed that fall within the particular class is of the weight of the domestic textile fabric, and
(B) the proportion, expressed as a percentage, that the aggregate weight of the fibres of which the imported textile fabric is composed that fall within that particular class is of the weight of the imported textile fabric.

SOR/98-54, s. 3.

Same Condition Uses and Operations

12 For the purposes of paragraph 89(1)(a) of the Act, imported goods will be considered to be in the same condition after they

(a) undergo any of the processes described in Article 303(6)(b) of NAFTA or any of the operations described in paragraph 8 of Article X of Section F of the Uniform Regulations for the Interpretation, Application, and Administration of Chapters Three (National Treatment and Market Access for Goods) and Five (Customs Procedures) of the North American Free Trade Agreement, if those processes or operations do not materially alter the characteristics of the goods;

(b) are used for

(i) the development or production, other than as plant equipment, of goods to be exported, or
(ii) display or demonstration; or

(c) in the case of reusable containers, are used in the international transportation of goods.

SOR/98-54, s. 3.

Portion of Duties that May Be Granted as a Drawback

13 Where the amount of duties paid in respect of imported textile fabric that is considered under section 11 to be of the same class as domestic textile fabric exceeds the amount of duties that would have been payable had the domestic textile fabric been imported, the portion of the duties so paid that may be granted as a drawback is the proportion that the amount that would have been so payable is of the amount that was so paid.

No Drawback to Be Granted

14 A drawback shall not be granted in respect of

(a) imported goods described in paragraph 89(1)(d) of the Act on which relief of duties would otherwise have been granted, where the domestic goods referred to in subparagraph 4(c)(i) or (d)(i) are processed before those imported goods are processed;
(b) imported goods described in paragraph 89(1)(e) of the Act on which relief of duties would otherwise have been granted, where the domestic goods referred to in subparagraph 4(e)(i) are consumed or expended before those imported goods are consumed or expended;
(c) imported goods described in paragraph 89(1)(c) or (e) of the Act on which relief of duties would otherwise have been granted, if those goods are goods described in Schedule III; or
(d) imported goods described in paragraph 89(1)(d) of the Act on which relief of duties would otherwise have been granted, if those goods are spirits, wine or beer.

SOR/98-54, s. 3;
SOR/2003-237, s. 3.

14.1 A drawback in respect of duties levied under section 21.1 or 21.2 of the Act shall not be granted to a person in respect of goods subject to those duties to the extent that it can reasonably be regarded that

(a) the amount has previously been refunded, remitted, applied or paid to that person under the Act or any other Act of Parliament; or
(b) the person has applied for a refund, payment or remission of the amount under any other Act of Parliament.

SOR/2003-237, s. 3.

PART II Refund

Application

15 This Part applies in respect of the grant, under subsection 113(1) of the Act, of a refund of the duties paid on imported goods described in subsection 89(1) of the Act.
SOR/98-54, s. 3.

Circumstances in Which an Application for a Refund May Be Made

16 An application for a refund under this Part may be made where the goods have not been exported or deemed to have been exported before the application for a refund is made.

Persons Who May Claim a Refund

17 A refund may be claimed by the person to whom the Minister of National Revenue has issued a certificate under subsection 90(1) of the Act in respect of the goods on which the duties were paid.
SOR/98-54, s. 1.

No Refund to Be Granted

18 A refund in respect of duties levied under section 21.1 or 21.2 of the Act shall not be granted to a person in respect of goods subject to those duties to the extent that it can reasonably be regarded that

(a) the amount has previously been refunded, remitted, applied or paid to that person under the Act or any other Act of Parliament; or
(b) the person has applied for a refund, payment or remission of the amount under any other Act of Parliament.

SOR/2003-237, s. 4.

SCHEDULE I(Sections 2 and 11)

Classes of Fibres


Natural textile fibres such as silk, wool, cotton, flax and sisal


Artificial fibres that are viscose or acetates


Synthetic fibres that are nylons or other polyamides, polyesters, acrylics, polyethylenes, polypropylenes or elastomers


Glass

SCHEDULE II(Section 6)

Classes of Ships and Aircraft


Ocean-going ships operating or being repaired or reconstructed to operate exclusively in international trade


Foreign warships, within the meaning of the Ships’ Stores Regulations


Telegraph cable ships, within the meaning of the Ships’ Stores Regulations


Ships registered in a country other than Canada that are used exclusively for pleasure purposes


Aircraft operating exclusively in international flights


International aircraft, within the meaning of the Ships’ Stores Regulations

SCHEDULE III(Section 14)

Goods Not Subject to Drawback


Fuel


Plant equipment