Liability of Excise Warehouse Licensees and Licensed Users

Non-duty-pai d packaged alcohol

140. If non-duty-paid packaged alcohol is entered into an excise warehouse immediately after being packaged, the excise warehouse licensee is liable for the duty on the alcohol at the time it is entered into the warehouse.

Imported packaged alcohol

141. If, in accordance with subsection 21.2(3) of the Customs Tariff, imported packaged alcohol is, without the payment of duty, released under the Customs Act to the excise warehouse licensee or licensed user who imported it, the excise warehouse licensee or licensed user is liable for the duty on the alcohol.

Transfer between warehouse licensees

142. (1) If non-duty-paid packaged alcohol is removed from the excise warehouse of an excise warehouse licensee (in this subsection referred to as the ``transferor'') to the excise warehouse of another excise warehouse licensee, at the time the alcohol is entered into the warehouse of the other licensee,

    (a) the other licensee becomes liable for the duty on the alcohol; and

    (b) the transferor ceases to be liable for the duty.

Transfer to licensed user

(2) If non-duty-paid packaged alcohol is removed from an excise warehouse to the specified premises of a licensed user, at the time the alcohol is entered into those premises,

    (a) the licensed user becomes liable for the duty on the alcohol; and

    (b) the excise warehouse licensee ceases to be liable for the duty.

Transfer from licensed user

(3) If non-duty-paid packaged alcohol is removed from the specified premises of a licensed user to an excise warehouse, at the time the alcohol is entered into the warehouse,

    (a) the excise warehouse licensee becomes liable for the duty on the alcohol; and

    (b) the licensed user ceases to be liable for the duty.

Non-dutiable Uses and Removals of Alcohol

Approved formulations

143. The Minister may impose any conditions or restrictions that the Minister considers necessary in respect of the making, importation, packaging, use or sale of, or other dealing with, an approved formulation.

Non-dutiable uses - approved formulations

144. Duty is relieved on bulk alcohol and non-duty-paid packaged alcohol used by a licensed user in an approved formulation.

Duty not payable - bulk alcohol

145. (1) Duty is not payable on bulk alcohol

    (a) taken for analysis by an alcohol licensee or a licensed user in a manner approved by the Minister;

    (b) destroyed by an alcohol licensee or a licensed user in a manner approved by the Minister; or

    (c) used by a licensed user in a process in which the absolute ethyl alcohol is destroyed to the extent approved by the Minister.

Duty not payable - packaged alcohol

(2) Duty is not payable on non-duty-paid packaged alcohol

    (a) taken for analysis by an excise warehouse licensee or a licensed user in a manner approved by the Minister;

    (b) destroyed by an excise warehouse licensee or a licensed user in a manner approved by the Minister; or

    (c) used by a licensed user in a process in which the absolute ethyl alcohol is destroyed to the extent approved by the Minister.

No duty payable - alcohol taken for analysis or destroyed

(3) Duty is not payable on bulk alcohol or non-duty-paid packaged alcohol that is taken for analysis or destroyed by the Minister.

Duty not payable - vinegar

146. (1) Duty is not payable on alcohol that is used by a licensed user to produce vinegar if not less than 0.5 kg of acetic acid is produced from every litre of absolute ethyl alcohol used.

Deemed taken for use if deficiency

(2) If a licensed user uses alcohol to produce vinegar and less than 0.5 kg of acetic acid is produced from every litre of absolute ethyl alcohol used, the licensed user is deemed to have taken for use, at the time the vinegar is produced, the number of litres of that alcohol that is equivalent to the number determined by the formula

A - (2 x B)

where

A is the number of litres of absolute ethyl alcohol used, and

B is the number of kilograms of acetic acid produced.

Duty not payable - packaged alcohol

147. (1) Duty is not payable on non-duty-paid packaged alcohol, other than alcohol contained in a marked special container, that is removed from an excise warehouse

    (a) for delivery

      (i) to an accredited representative for their personal or official use,

      (ii) to a duty free shop for sale in accordance with the Customs Act,

      (iii) to a registered user for use in accordance with their registration, or

      (iv) as ships' stores in accordance with the Ships' Stores Regulations; or

    (b) for export by the excise warehouse licensee in accordance with this Act.

Duty not payable - special container of spirits

(2) Duty is not payable on spirits contained in a marked special container that is removed from an excise warehouse

    (a) for delivery to a registered user for use in accordance with their registration, if the container is marked for delivery to and use by a registered user; or

    (b) for export by the excise warehouse licensee in accordance with this Act, if the container was imported.

Duty not payable - special container of wine

(3) Duty is not payable on wine imported in a marked special container that is removed from an excise warehouse for export by the excise warehouse licensee in accordance with this Act.

Determining Volume of Alcohol

Volume of alcohol

148. (1) The volume and absolute ethyl alcohol content of alcohol shall be determined in a manner specified by the Minister using approved instruments.

Approval of instrument

(2) The Minister may examine and approve an instrument or a class, type or design of instruments for the measurement of the volume and absolute ethyl alcohol content of alcohol.

Re-examinati on

(3) The Minister may direct in writing that any instrument previously examined and approved, or of a class, type or design previously examined and approved, by the Minister be submitted to the Minister for re-examination and, if the Minister so directs, the person who has the custody and control of the instrument shall immediately submit it to the Minister for re-examination.

Revocation of approval

(4) After re-examining an instrument, the Minister may, in writing, revoke the Minister's approval of that instrument or instruments of the same class, type or design as that instrument.

Indicating instrument is approved

(5) Every approved instrument the approval of which has not been revoked shall indicate the approval in a manner acceptable to the Minister.

Excise Warehouses

Restriction - entering into warehouse

149. No person shall enter non-duty-paid packaged alcohol into an excise warehouse except in accordance with this Act.

Import by warehouse licensee

150. (1) If imported packaged alcohol is, without the payment of duty, released under the Customs Act to the excise warehouse licensee who imported it, the licensee shall immediately enter it into the excise warehouse of the licensee.

Import by licensed user

(2) If imported packaged alcohol is, without the payment of duty, released under the Customs Act to the licensed user who imported it, the licensed user shall immediately enter it into the specified premises of the licensed user.

Restriction on removal

151. (1) No person shall remove non-duty-paid packaged alcohol from an excise warehouse.

Exception

(2) Subject to the regulations, a person may remove from an excise warehouse

    (a) non-duty-paid packaged alcohol, other than alcohol in a marked special container, for

      (i) entry into the duty-paid market,

      (ii) delivery to another excise warehouse,

      (iii) delivery to an accredited representative for their personal or official use,

      (iv) delivery as ships' stores, in accordance with the Ships' Stores Regulations,

      (v) delivery to a duty free shop for sale in accordance with the Customs Act to persons who are about to leave Canada,

      (vi) delivery to a licensed user,

      (vii) delivery to a registered user for use in accordance with their registration, or

      (viii) export;

    (b) a non-duty-paid marked special container of wine for

      (i) delivery to another excise warehouse, or

      (ii) entry into the duty-paid market for delivery to a bottle-your-own premises;

    (c) a non-duty-paid marked special container of spirits for

      (i) delivery to another excise warehouse,

      (ii) if the container is marked for delivery to and use by a registered user, delivery to a registered user for use in accordance with their registration, or

      (iii) if the container is marked for delivery to and use at a bottle-your-own premises, entry into the duty-paid market for delivery to a bottle-your-own premises; or

    (d) an imported non-duty-paid marked special container of alcohol, for export.

Return of duty-paid alcohol

152. If packaged alcohol that has been removed from an excise warehouse for entry into the duty-paid market is returned to that warehouse under prescribed conditions, the alcohol may be entered into the warehouse as non-duty-paid packaged alcohol.

Return of non-duty-paid alcohol

153. If non-duty-paid packaged alcohol that has been removed from an excise warehouse in accordance with section 147 is returned to an excise warehouse under prescribed conditions, the alcohol may be entered into the warehouse as non-duty-paid packaged alcohol.

Supplying packaged alcohol to retail store

154. (1) Subject to subsections (2) and 155(1), an excise warehouse licensee shall not, during a calendar year, supply from a particular premises specified in the excise warehouse licence of the licensee to a retail store more than 30% of the total volume of packaged alcohol supplied from those premises to all retail stores during the year.

Exception for certain retail stores

(2) An excise warehouse licensee who is an alcohol licensee may supply from the particular premises to a retail store of the licensee more than 30% of that total volume if

    (a) the store is located at a place at which the licensee produces or packages alcohol; and

    (b) not less than 90% of the volume of packaged alcohol supplied to the store from the particular premises in the year consists of alcohol that was packaged by, or, if the licensee was responsible for the alcohol immediately before it was packaged, on behalf of, the licensee.

Exception for remote stores

155. (1) On application in the prescribed form and manner by an excise warehouse licensee who is a liquor authority or a non-retailer of alcohol, the Minister may authorize the licensee to supply during a calendar year from a particular premises specified in their excise warehouse licence to a retail store more than 30% of the total volume of packaged alcohol to be supplied from the premises to all retail stores during the year if the Minister is satisfied that the delivery of packaged alcohol by railway, truck or water vessel to the store is not possible for five consecutive months in every year.

Revocation

(2) The Minister may revoke an authorization under subsection (1) if

    (a) the licensee makes a written request to the Minister to revoke the authorization;

    (b) the licensee fails to comply with any condition imposed in respect of the authorization or any provision of this Act;

    (c) the Minister is no longer satisfied that the requirements of subsection (1) are met; or

    (d) the Minister considers that the authorization is no longer required.

Notice of revocation

(3) If the Minister revokes an authorization of a licensee, the Minister shall notify the licensee in writing of the revocation and its effective date.

Removal of special container

156. An alcohol licensee who has marked a special container of alcohol may remove the container from their excise warehouse to return it to the bulk alcohol inventory of the licensee if the marking on the container is removed by the licensee in the manner approved by the Minister.

Removal of packaged wine from excise warehouse

157. A wine licensee may remove non-duty-paid packaged wine from their excise warehouse to return it to the bulk wine inventory of the licensee.

Removal of packaged spirits from excise warehouse

158. A spirits licensee may remove non-duty-paid packaged spirits from their excise warehouse to return them to the bulk spirits inventory of the licensee.