S.I. No. 264/1986 - European Communities (Value-Added Tax) (Exemption on Temporary Importation of Certain Goods) Regulations, 1986.

S.I. No. 264 of 1986.

EUROPEAN COMMUNITIES (VALUE-ADDED TAX) (EXEMPTION ON TEMPORARY IMPORTATION OF CERTAIN GOODS) REGULATIONS, 1986.

I, JOHN BRUTON, Minister for Finance, in exercise of the powers conferred on me by section 3 of the European Communities Act, 1972 (No. 27 of 1972), and for the purposes of giving effect to Council Directive No. 85/362/EEC of 16 July, 1985¹ hereby make the following Regulations:

¹O.J No. L192, 24 July, 1985 p.20-28

1. (1) These Regulations may be cited as the European Communities (Value-Added Tax) (Exemption on Temporary Importation of Certain Goods) Regulations, 1986.

(2) These Regulations shall be deemed to have come into operation on the 1st day of January, 1986.

(3) These Regulations shall be construed together with the Act and the Customs Acts and any instrument relating to customs made under statute.

(4) Means of transport, pallets and containers are excluded from the scope of these Regulations.

(5) In these Regulations—

"the Act" means the Value-Added Tax Act, 1972 (No. 22 of 1972);

"the Community" means the territory of the Member States of the European Economic Community where Council Directive No. 77/388/EEC of 17 May, 1977² applies;

²O.J No. L145, 13 June, 1977 p. 140

"Member State" means a Member State of the Community;

"person" means a natural or legal person;

"tax" means value-added tax;

"temporary importation exemption" means the arrangements whereby goods, which are intended to remain temporarily in the territory of the State and to be re-exported, may be imported with exemption from tax in accordance with the conditions laid down by these Regulations.

(6) A word or expression that is used in these Regulation and is also used in Council Directive No. 85/362/EEC of 16 July, 1985 shall, unless the context otherwise requires, have the meaning in these Regulations that it has in that Directive.

(7) A reference to a Regulation is to a Regulation of these Regulations and a reference to a paragraph, subparagraph or clause is to a paragraph, subparagraph or clause of the provision in which the reference occurs, unless it is indicated that reference to some other provision is intended.

2. The Revenue Commissioners shall, subject to the provisions of these Regulations and such conditions as the said Commissioners may impose, grant temporary importation exemption for goods temporarily imported into the State from another Member State, provided that they are satisfied that such goods—

( a ) are intended to be re-exported from the State without alteration;

( b ) satisfy the conditions laid down in Articles 9 and 10 of the Treaty establishing the European Economic Community or, in the case of goods falling under the Treaty establishing the European Coal and Steel Community, are in free circulation;

( c ) have been acquired subject to the rules governing the application of tax in the Member State of exportation and have not benefited by virtue of their exportation, from any relief from tax;

( d ) belong to a person established outside the State; and

( e ) are not consumable goods.

3. (1) Subject to paragraph (2), goods imported into the State from an other Member State which do not qualify for temporary importation exemption under Regulation 2 shall qualify for such exemption if, had they been imported from outside the Community, they would qualify for such exemption under any of the Regulations 14 to 29.

(2) Temporary importation exemption shall not be granted in any case where—

(a) the goods meet the conditions laid down in Article 9 and 10 of the Treaty establishing the European Economic Community;

(b) the goods were not acquired pursuant to the rules governing the application of tax in the Member State of exportation or, by virtue of being exported, benefited from exemption from tax; and

(c) the importer is a non-taxable person or is a taxable person not entitled to deduction of tax in full.

4. The Revenue Commissioners shall, subject to the provisions of these Regulations and such conditions as the said Commissioners may impose, grant temporary importation exemption for goods imported temporarily into the State from a country outside the Community where the goods qualify for such exemption under any of the Regulations 14 to 29.

5. (1) Subject to paragraph (2), the Revenue Commissioners may require security to be given at the time of granting temporary importation exemption to ensure payment of any tax which may become due if a chargeable event within the meaning of Regulation 12 should occur, and where such security is required—

(a) the person to whom temporary importation exemption has been granted may choose whether it shall be given by—

(i) making a cash deposit in Irish pounds,

(ii) a guarantor who has his normal residence or an establishment in the State and who is approved by the Revenue Commissioners, or

(iii) any other guarantee acceptable to the Revenue Commissioners;

(b) it shall not exceed the amount of tax that would have been due on the value of the goods at the time of their importation if they had been declared for home use at that time.

(2) No security shall be required—

(a) for goods covered by the procedure provided for in Council Regulation (EEC) No. 3/84 of 19 December, 1983;³

³OJ No. L2, 4 January, 1984 p. 1

(b) for goods imported either from another Member State or from a country outside the Community in the cases referred to in Annex 1 of Commission Regulation (EEC) No. 1751/84 of 13 June, 1984⁴ and Articles 3 and 33 of Council Regulation (EEC) No. 3599/82 of 21 December, 1982⁵.

⁴OJ No. L171, 29 June, 1984 p. 1

⁵OJ No. L376, 21 December, 1982 p. 1

6. The provisions of Commission Regulation (EEC) No. 1751/84 other than Articles 22, 23, 29 and 30 of the said Regulation shall apply to importations under these Regulations as if the tax were a customs duty or charge or levy to which Council Regulation (EEC) No. 3599/82 applied and such a duty, charge or levy applied to importations from other Member States as well as to importations from countries outside the Community.

7. The Revenue Commissioners may refuse to grant temporary importation exemption in cases where—

(a) they consider it impossible to identify the goods or to verify their use in the State;

(b) the guarantees considered necessary are not provided by the person requesting such exemption; or

(c) the person requesting the exemption has previously made improper use of such exemption or has committed a serious infringement of customs or fiscal legislation.

8. (1) The Revenue Commissioners may require persons to whom they have granted temporary importation exemption to make available for inspection at times and places that are reasonable the goods which are the subject of such exemption together with all relevant documents.

(2) The Revenue Commissioners may revoke temporary importation exemption if they find that a person to whom such exemption has been granted has not satisfied the provisions of these Regulations.

9. (1) The Revenue Commissioners shall fix the period during which goods may remain in the State under temporary importation exemption arrangements under these Regulations but, without prejudice to the limits laid down in Regulations 16, 17, 18, 20, 23, 28 and 30, the maximum duration of this period shall be 24 months.

(2) Notwithstanding paragraph (1), the Revenue Commissioners may, in exceptional circumstances and at their absolute discretion, on request by the person to whom temporary importation exemption has been granted extend, within reasonable limits and subject to the provisions of these Regulations, the periods referred to in paragraph (1).

10. The Revenue Commissioners shall on request by any person authorise the transfer of the temporary importation exemption to that person, where he satisfies the conditions laid down in these Regulations and assumes all the obligations imposed on the person to whom the temporary importation exemption was first granted, in particular those arising from the fixing of the period during which the goods in question may remain under the said exemption.

11. Where goods, in respect of which temporary importation exemption applies, are supplied, tax shall not be chargeable provided that the purchaser is a person established outside the State and the goods continue to remain eligible for the said exemption.

12. (1) Temporary importation exemption shall terminate, but tax shall not become chargeable, if goods to which the said exemption applies are—

(a) re-exported from the State;

(b) placed with a view to their subsequent re-exportation—

(i) under warehouse arrangements,

(ii) in a free zone, or

(iii) under transit arrangements provided for or permitted under Community law; or

(c) destroyed under customs control, or are provided to the satisfaction of the Revenue Commissioners to have been totally destroyed or irretrievably lost and incapable of use thereafter.

(2) (a) Temporary importation exemption shall terminate and tax shall, subject to paragraph (b), become chargeable—

(i) when, in exceptional cases and cases covered by Regulation 15, the Revenue Commissioners authorise goods, in respect of which temporary importation exemption has been granted, to be declared for home use,

(ii) when goods which are recoverable in the form of waste products resulting from duly authorised destruction are declared for home use, or

(iii) when the goods referred to in Regulation 30 are declared for home use.

(b) Where goods are released for home use and the importer is a non-taxable person or a taxable person not entitled to deduct the tax in full, tax shall be deemed to have become chargeable at the time when the goods entered the State.

(3) If any of the conditions, under which temporary importation exemption was granted, ceases to be fulfilled in circumstances other than those specified in paragraph (1), the exemption shall terminate and tax shall become chargeable either at the time when the condition ceased to be fulfilled, or at the time when the goods entered the State if it is established that the condition was never fulfilled.

13. (1) Temporary importation exemption shall not be granted for goods temporarily imported from countries outside the Community with partial or total relief from customs duties under the provisions of Title III of Regulation (EEC) No. 3599/82.

(2) For goods which are eligible for partial relief from customs duties, tax shall become chargeable at the time of entry of the goods into the State, and adjustment of such tax shall not be required following payment of customs duties chargeable where the importer is a taxable person entitled to deduct the full amount of tax due in respect of the imported goods.

14. (1) In this Regulation "professional equipment" means equipment and accessories (including spare parts subsequently imported for the repair of the said equipment) needed for the exercise of his trade or profession by a person established outside the State for the purpose of performing in the State a particular job of work, inasmuch as such equipment is of a kind described in Annex IV of Commission Regulation (EEC) No. 1751/84.

(2) Temporary importation exemption shall be granted for professional equipment which is—

(a) owned by a person established outside the State;

(b) imported by a person established outside the State; and

(c) to be used exclusively by the person importing the said equipment, or under his supervision:

Provided that—

(i) the condition referred to in subparagraph (c) shall not apply to cinematographic equipment imported for the purpose of producing films under a co-production contract concluded with a person established in the State;

(ii) in the case of joint radio or television programme productions, professional equipment may be the subject of a hire-contract or similar contract to which a person established in the State is party.

15. (1) In this Regulation "event" means—

(a) a trade, industrial, agricultural or craft exhibition, fair or similar show or display;

(b) an exhibition or meeting which is organised primarily to promote a charitable purpose;

(c an exhibition or meeting which is organised primarily to promote any branch of learning, art, craft, sport or scientific, technical, educational, cultural, trade union or tourist activity, or to promote friendship between peoples or to promote religious knowledge or worship;

(d) a meeting of representatives of international organisations or international groups of organisations;

(e) a ceremony or meeting of an official or commemorative character;

other than exhibitions organised for private purposes in shops or business premises with a view to sale of the goods imported.

(2) Temporary importation exemption shall be granted for—

(a) goods intended for display or to be the subject of a demonstration at an event;

(b) goods intended for use at an event for the purpose of presenting imported products, including—

(i) goods necessary for the demonstration of imported machinery or apparatus on exhibition,

(ii) equipment, including electrical fittings, used for constructing and decorating the temporary stands of a person established outside the State,

(iii) advertising material and demonstration and other equipment intended for use in publicising imported goods on exhibition, including sound recordings, films and transparencies, together with the apparatus required in connection with their use;

(c) equipment, including interpreting installations, sound-recording apparatus and educational, scientific or cultural films, intended for use at international meetings, conferences and symposia;

(d) live animals intended for exhibition at, or participation in, an event;

(e) products obtained during an event from goods, machinery, apparatus or animals imported temporarily.

16. (1) In this Regulation "teaching aid" means any aid intended for the exclusive purpose of teaching or vocational training and, in particular, models, instruments, apparatus, machines and accessories thereof, insofar as such aids are of a kind described in Annex V of Commission Regulation (EEC) No. 1751/84.

(2) Subject to paragraphs (3) and (4), temporary importation exemption shall be granted for—

(a) teaching aids;

(b) spare parts and accessories for such aids;

(c) tools especially designed for the maintenance, checking, calibration or repair of such aids.

(3) The exemption referred to in paragraph (2) shall be granted provided that the goods referred to in that paragraph—

(a) are imported by public or private teaching or vocational training establishments which are essentially non-profit making and have been approved by the Revenue Commissioners for the purposes of this Regulation, and are used under the supervision and responsibility of such establishments;

(b) are used for non-commercial purposes;

(c) are imported in reasonable quantities, having regard to their intended purposes; and

(d) remain, throughout their stay in the State, the property of a person who is established outside the State.

(4) The period during which such teaching aids may be granted the said exemption shall not exceed six months.

17. (1) In this Regulation "scientific equipment" means instruments, apparatus, machines and accessories thereof used solely for the purpose of scientific research or education.

(2) Subject to paragraphs (3) and (4), temporary importation exemption shall be granted for —

(a) scientific equipment and accessories;

(b) spare parts for equipment referred to under (a);

(c) tools specially designed for the maintenance, checking, calibration or repair of scientific equipment used in the State exclusively for purposes of scientific research or teaching.

(3) The exemption referred to in paragraph (2) shall be granted provided that the scientific equipment, accessories, spare parts and tools—

(a) are imported by scientific or teaching establishments which are essentially non-profit making and have been approved by the Revenue Commissioners for the purposes of this Regulation, and are used under the supervision and responsibility of such establishments;

(b) are used for non-commercial purposes;

(c) are imported in reasonable numbers having regard to their intended purposes; and

(d) remain, throughout their stay in the State, the property of a person who is established outside the State.

(4) The period during which such scientific equipment may be granted the said exemption shall not exceed six months.

18. (1) Subject to paragraph (2), temporary importation exemption shall be granted for medical, surgical and laboratory equipment intended for hospitals and other medical institutions, provided that the said equipment—

(a) has been dispatched on an occasional basis, on loan and free of charge; and

(b) is intended for diagnostic or therapeutic purposes.

(2) The period during which medical, surgical and laboratory equipment may be granted the said exemption shall not exceed six months.

19. (1) Temporary importation exemption shall be granted for materials for use in connection with countering the effects of disasters affecting the State, provided that such materials—

(a) have been imported on loan and free of charge; and

(b) are intended for State bodies or bodies approved by the Revenue Commissioners for the purposes of this Regulation.

20. (1) In this Regulation "packings" means—

(a) holders used, or to be used, as external or internal coverings for goods;

(b) holders on which goods are, or are to be, rolled, wound or attached; but excluding packing materials such as straw, paper, glass, wool and shavings when imported in bulk.

(2) Subject to paragraphs (3) and (4), temporary importation exemption shall be granted for packings provided that where—

(a) the packings are imported filled, they are declared as being for re-exportation empty or filled; or

(b) the packings are imported empty, they are declared as being for re-exportation filled.

(3) Packings admitted under temporary importation exemption shall not be used, even as an exception, between two points located within the State except with a view to the export of goods, and in the case of packings imported filled, this prohibition shall apply only from the time that they are emptied.

(4) The period during which packings may be granted such exemption shall not exceed six months where they are imported filled or three months where they are imported empty.

21. (1) In this Regulation—

"personal effects" means any clothing and other new or used articles intended for the personal use of the traveller,

"personal luggage" has the meaning assigned to it by Council Directive 69/169/EEC of 28 May, 1969⁶.

⁶OJ No. L133, 4 June, 1969 p.6

(2) Temporary importation exemption shall be granted in respect of the personal effects which travellers are carrying on their person or in their personal luggage for the duration of their stay in the State.

22. Temporary importation exemption shall be granted in respect of—

(a) samples which are representative of a particular category of goods and which are intended to be displayed or used for demonstration purposes with a view to obtaining orders for similar goods;

(b) films demonstrating the nature or the operation of foreign equipment or products, provided that they are not intended for public showing for charge;

(c) tourist publicity material of a kind described in Annex VI of Commission Regulation (EEC) No. 1751/84;

(d) goods of any kind which are to be subjected to tests, experiments or demonstrations, including the tests and experiments required for type-approval procedures, but excluding any tests, experiments or demonstrations constituting a gainful activity;

(e) goods of any kind to be used to carry out tests, experiments or demonstrations, but excluding any tests, experiments or demonstrations constituting a gainful activity.

23. (1) In this Regulation—

"welfare material" means material intended for cultural, educational, recreational, religious or sporting activities by seafarers, inasmuch as such material is of a kind described in Annex VII of Commission Regulation (EEC) No. 1751/84,

"seafarers" means all persons transported on board a vessel and responsible for tasks relating to the operation or servicing of the vessel at sea,

"cultural or social establishments" means hostels, clubs and recreational premises for seafarers which are managed by official bodies or religious or other non-profit making organisations, and places of worship where religious services are held regularly solely or mainly for the benefit of seafarers.

(2) Temporary importation exemption shall be granted in respect of welfare material for seafarers, provided that the material is—

( a ) brought ashore from a vessel for use on land by the crew of that vessel for a period not exceeding that of the vessel's stay in port; or

( b ) imported for use in cultural or social establishments for a period not exceeding six months.

24. Temporary importation exemption shall be granted for equipment used, under the supervision and responsibility of a public authority, for the building, repair or maintenance of infrastructure of common importance in the area adjoining the land frontier of the State.

25. Temporary importation exemption shall be granted for—

( a ) live animals of any species imported for dressage, training or breeding purposes or in order to be given veterinary treatment;

( b ) live animals of any species imported for grazing purposes.

26. Temporary importation exemption shall be granted for—

( a ) positive cinematograph films, printed and developed, intended for protection prior to commercial use;

( b ) films, magnetic tapes and wires which are intended to be provided with a sound track, dubbed or copied;

( c ) carrier material for recorded sound and data-processing, including punched cards, made available free of charge to a person, whether or not established in the State.

27. Temporary importation exemption shall be granted for—

( a ) moulds, dies, blocks, drawings, sketches and other similar articles intended for a person established in the State, where at least 75 per cent of the production resulting from their use is exported from the territory of the Community;

( b ) measuring, checking and testing instruments and other similar articles intended for a person established in the State for use in a manufacturing process, where at least 75 per cent of the production resulting from their use is exported from the territory of the Community;

( c ) special tools and instruments made available free of charge to a person established in the State for use in the manufacture of goods which are to be exported in their entirety, on condition that such special tools and instruments remain the property of the person who made them available.

28. (1) Temporary importation exemption shall be granted for replacement means of production made temporarily available free of charge to the importer on the initiative of the supplier of similar means of production to be subsequently imported for release for home use or for means of production re-installed after repair.

(2) The period during which such means of production may remain under the said exemption may not exceed six months.

29. The Revenue Commissioners shall grant temporary importation exemption where they are satisfied that the goods concerned have no economic effect.

30. (1) Notwithstanding that the definition of "temporary importation exemption" in Regulation 1(5) includes the provision that the goods concerned are intended to remain temporarily in the State and to be re-exported, temporary importation exemption shall, subject to these Regulations, be granted in respect of the following goods, whether imported from another Member State or from outside the Community—

( a ) second-hand goods imported with a view to their sale by auction;

( b ) goods, imported under a contract of sale, which are to be subjected to satisfactory acceptance tests;

( c ) consignments on approval or made-up articles of fur, precious stones, carpets and articles of jewellery, provided that their particular characteristics prevent their being imported as samples;

( d ) works of art and other goods, intended for decoration but not generally for utility purposes, which are imported for the purposes of exhibition with a view to possible sale, being—

(i) paintings, drawings and pastels, including copies, executed entirely by hand, excluding hand-decorated manufactured wares and industrial drawings,

(ii) lithographs, prints and engravings, signed and numbered by the artist, obtained from lithographic stones, plates or other engraved surfaces, executed entirely by hand,

(iii) original sculptures and statuary, excluding mass-produced reproductions and handicrafts of a commercial nature,

(iv) tapestries and wall textiles made by hand from original designs provided by artists, provided that there is not more than one example of each, and

(v) original ceramics and mosaics on wood.

(2) The period during which the said exemption may be granted shall not exceed six months in the case of goods referred to in paragraph (1) (a), (1) (b) and (1) (d) and four weeks in that of paragraph (1) (c).

(3) For the purposes of this Regulation, where goods specified in paragraph (1) cease to be eligible for temporary importation exemption by reason of their sale in the State, the amount on which tax shall be chargeable shall be the price paid by the first purchaser of the goods in the State.

31. Authorisations in respect of temporary importation exemptions granted prior to the commencement of these Regulations and which are not provided for under the said Regulations may, if the Revenue Commissioners think fit, continue for a period not exceeding twenty four months from the said date.

32. The following enactments shall not apply in relation to goods in respect of which temporary importation exemption has been granted by virtue of these Regulations:

Section 12 of the Finance (Customs Duties) (No. 4) Act, 1932 (No. 34 of 1932),

Section 17 of the Finance Act, 1946 (No. 15 of 1946), the Relief from Customs Duties (Fairs, Exhibitions and Similar Events) Order, 1956 ( S.I. No. 148 of 1956 ),

the Relief from Customs Duties (Professional Equipment Order), 1965 ( S.I. No. 143 of 1965 ),

the Relief from Customs Duties (Packings) Order, 1965 ( S.I. No. 223 of 1965 ), and

Council Regulation (EEC) No. 3599/82.

33. A person who, after the commencement of these Regulations, contravenes a provision thereof, shall be guilty of an offence and shall, without prejudice to any other penalty to which he may be liable, be liable, on summary conviction, to a fine not exceeding £500.

GIVEN under my Official Seal this 28th day of July 1986.

JOHN BRUTON,

Minister for Finance.

EXPLANATORY NOTE.

These Regulations give effect to EEC Council Directive No. 85/362/EEC of 16 July 1985. The Directive is based on a mandatory requirement in Article 14 (1) (c) of the Sixth VAT Directive (77/388/EEC) and sets down the scope of the exemptions from VAT for goods declared to be under temporary importation arrangements and which qualify for exemptions from customs duties.

The Regulations provide relief from the payment of VAT, subject to conditions, for most goods imported on a temporary basis into Ireland from another Member State of the EEC. Consumable goods and means of transport are excluded from the provisions of the Regulations. Exceptionally, temporary importation exemption is also being provided for certain goods, including certain second-hand goods and specific works of art, imported on a temporary basis with a view to possible sale. Exemption from VAT is also provided for certain specific temporary importations of goods from countries outside the EEC. The goods affected include certain professional equipment, teaching aids, scientific equipment, medical, surgical and laboratory equipment etc. The VAT exemption for these goods parallels a customs duty exemption for similar importations provided by Council Regulation (EEC) No. 3599/82.

The Revenue Commissioners may require security to be given in the case of most importations under these Regulations. An importer can choose the type of security he wishes to provide (cash, bond or other security) so long as it is in a form acceptable to the Revenue Commissioners.