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Duty Free Shop Regulations (SOR/86-1072)

Regulations are current to 2020-06-28 and last amended on 2019-06-25. Previous Versions

Duty Free Shop Regulations

SOR/86-1072

CUSTOMS ACT

Registration 1986-11-06

Regulations Respecting Duty Free Shops

P.C. 1986-2530 1986-11-06

Whereas, pursuant to subsection 164(3) of the Customs ActFootnote *, a copy of proposed Regulations respecting duty free shops, substantially in the form annexed hereto, was published in the Canada Gazette Part I on April 26, 1986 and a reasonable opportunity was thereby afforded to interested persons to make representations to the Minister of National Revenue with respect thereto;

Therefore, Her Excellency the Governor General in Council, on the recommendation of the Minister of National Revenue, pursuant to section 30, subsection 37(1), paragraphs 164(1)(i) and (j) and section 166 of the Customs ActFootnote *, is pleased hereby to make the annexed Regulations respecting duty free shops, effective on the day that section 30, subsection 37(1), paragraphs 164(1)(i) and (j) and section 166 of the Customs Act come into force.

Short Title

 These Regulations may be cited as the Duty Free Shop Regulations.

Interpretation

 In these Regulations,

Act

Act means the Customs Act; (Loi)

applicant

applicant means a person who applies for a licence; (demandeur)

beer

beer means beer or malt liquor as defined in section 4 of the Excise Act; (bière)

border crossing point

border crossing point means a place on the international border between Canada and the United States at which there is a customs office; (poste frontalier)

chief officer of customs

chief officer of customs, with respect to a duty free shop or a proposed duty free shop, means the manager of the customs office or customs offices that serve the area in which the duty free shop is located or is proposed to be located; (agent en chef des douanes)

Department

Department[Repealed, SOR/2002-218, s. 1]

excisable goods

excisable goods means spirits, wine, beer or tobacco products; (marchandises assujetties à l’accise)

excise warehouse

excise warehouse has the same meaning as in section 2 of the Excise Act, 2001; (entrepôt d’accise)

intoxicating liquor

intoxicating liquor has the same meaning as in the Importation of Intoxicating Liquors Act; (boisson enivrante)

licence

licence means a licence to operate a place as a duty free shop; (agrément)

licensee

licensee means a person to whom a licence has been issued; (exploitant)

permanent resident

permanent resident has the same meaning as in the Immigration Act, 1976. (résident permanent)

  • SOR/96-153, s. 1
  • SOR/2002-218, s. 1
  • SOR/2005-212, s. 1

PART ILicensing of Duty Free Shops

Issuance of Licence

  •  (1) For the purposes of section 24 of the Act and subject to subsection (6), a licence may be issued to any qualified person who makes an application in accordance with subsection (2) and who gives the security required under section 4.

  • (2) The person shall submit the application for a licence in the prescribed form to the Commissioner.

  • (3) A corporation is qualified to operate a duty free shop at a border crossing point if

    • (a) the corporation is incorporated in Canada;

    • (b) all the shares of the corporation are beneficially owned by

      • (i) a Canadian citizen or permanent resident,

      • (ii) another corporation that is incorporated in Canada all of whose shares are beneficially owned by a Canadian citizen or permanent resident, or

      • (iii) both a Canadian citizen or permanent resident and that other corporation; and

    • (c) the Canadian citizen or permanent resident referred to in paragraph (b)

      • (i) is of good character,

      • (ii) maintains their principal residence in Canada, and

      • (iii) resided in Canada for at least 183 days of the year before the year in which the corporation makes the application for the licence.

  • (4) A person other than a corporation is qualified to operate a duty free shop at a border crossing point if the person

    • (a) is a Canadian citizen or a permanent resident;

    • (b) is of good character;

    • (c) maintains his principal residence in Canada; and

    • (d) resided in Canada for at least 183 days of the year preceding the year in which the person makes the application for the licence.

  • (5) A person is qualified to operate a duty free shop at an airport or at a border crossing point if the person has been granted a lease or other right to occupy the place proposed as the duty free shop.

  • (6) The Minister shall not issue a licence to an applicant unless

    • (a) the applicant meets the qualifications referred to in subsection (3) or (4) and subsection (5) in the case of a duty free shop at a border crossing point, or subsection (5) in the case of a duty free shop at an airport;

    • (b) [Repealed, SOR/96-153, s. 2]

    • (c) [Repealed, SOR/2019-259, s. 1]

    • (d) [Repealed, SOR/2019-259, s. 1]

    • (e) an adequate range of goods is not available in, or adequate service is not provided by, any duty free shop already located in the area in which the proposed duty free shop is to be located;

    • (f) the establishment of a duty free shop will not impede the flow of traffic in the vicinity in which the proposed duty free shop is to be located; and

    • (g) the Agency is able to provide customs services with respect to the proposed duty free shop.

  • (7) [Repealed, SOR/96-153, s. 2]

  • SOR/92-189, s. 1
  • SOR/96-153, s. 2
  • SOR/2002-218, s. 2
  • SOR/2005-182, s. 1
  • SOR/2019-259, s. 1

Security

  •  (1) An applicant shall, before a licence is issued to him, give security in an amount that is determined by the Minister, but in no case shall the amount of security be less than $10,000.

  • (2) The Minister may at any time require a licensee to increase the amount of security given under subsection (1) to an amount sufficient to ensure the payment of any duties payable in respect of the goods in the duty free shop.

  • (3) The security given under subsection (1) shall be deposited with the chief officer of customs and shall be in the form of

    • (a) cash;

    • (b) a certified cheque;

    • (c) a transferable bond issued by the Government of Canada; or

    • (d) a bond issued by

      • (i) a company that is registered and holds a certificate of registry to carry on the fidelity or surety class of insurance business and that is approved by the President of the Treasury Board as a company whose bonds may be accepted by the Government of Canada,

      • (ii) a member of the Canadian Payments Association referred to in section 4 of the Canadian Payments Association Act,

      • (iii) a corporation that accepts deposits insured by the Canada Deposit Insurance Corporation or the Régie de l’assurance-dépôts du Québec to the maximum amounts permitted by the statutes under which those institutions were established,

      • (iv) a credit union as defined in subsection 137(6) of the Income Tax Act, or

      • (v) a corporation that accepts deposits from the public, if repayment of the deposits is guaranteed by Her Majesty in right of a province.

  • SOR/91-274
  • SOR/2001-197, s. 7

 [Repealed, SOR/2002-218, s. 3]

Term of Licence

  •  (1) Subject to subsection (2), a licence is valid for a period beginning on the date indicated on the licence as being the date on which the licence becomes effective and ending on the date indicated on the licence as being the date on which the licence expires.

  • (2) No licence shall be valid for more than 10 years.

  • SOR/2019-259, s. 2
 
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