Vol. 137, No. 13 — June 18, 2003

Registration
SOR/2003-201 5 June, 2003

EXCISE ACT, 2001

Regulations Respecting the Information to be Displayed on Alcohol Containers and their Packaging

P.C. 2003-855 5 June, 2003

Her Excellency the Governor General in Council, on the recommendation of the Minister of National Revenue, pursuant to paragraph 304(1)(f) of the Excise Act, 2001 (see footnote a) , hereby makes the annexed Regulations Respecting the Information to be Displayed on Alcohol Containers and their Packaging.

REGULATIONS RESPECTING THE INFORMATION TO BE DISPLAYED ON ALCOHOL CONTAINERS AND THEIR PACKAGING

INFORMATION

1. For the purpose of section 87 of the Excise Act, 2001, the prescribed information to be displayed is

• (a) the name and address of the alcohol licensee who packaged the alcohol; or
  (b) their licence number.

COMING INTO FORCE

2. These Regulations take effect on July 1, 2003.

REGULATORY IMPACT ANALYSIS STATEMENT

(This statement is not part of the Regulations.)

Description

The new Excise Act, 2001 (the "Act") received Royal Assent on June 13, 2002, thereby replacing the legislative provisions of the existing Excise Act, regarding the production and distribution of alcohol and tobacco products. The Act authorizes the Governor in Council to make identified related regulations in support of the new legislation.

Accordingly, the Regulations Respecting the Information to be Displayed on Alcohol Containers and their Packaging have been written to detail the prescribed information that an alcohol licensee is required to display on a container of alcohol that they package.

The information prescribed by these Regulations is the name and address or the licence number of the alcohol licensee who packaged the alcohol. This information will assist in the administration and enforcement of the Act by identifying the origin of the alcohol.

These Regulations closely resemble the existing guidelines "Guidelines for Distillery Operations — Labels to be Used on Bottled Spirits" under the Excise Act. The existing guidelines also require the pre-approval of all labels to be placed on a container of spirits; this practice will not be continued under the Act.

The existing guidelines allow a distiller to display the name and address or, the licence number of a licensed distiller for whom the spirits are being bottled if, the other licensee accepts, in writing, responsibility for the product, and stipulates that it is able to identify the actual bottling distiller of the bottling product. This helps ensure the responsible distiller is identified and this practice will continue.

Alternatives

There is no reasonable alternative to the making of these Regulations. In order to be able to identify the person who packaged a container of alcohol, these Regulations are required to prescribe the information that must be displayed on a container of alcohol.

Benefits and Costs

There are no increased costs as a result of these Regulations. Bottlers of alcohol are presently placing this information on labels currently in use.

There are no increased costs to the Canada Customs and Revenue Agency (CCRA) as a result of these Regulations. Minimal resource savings will be realized resulting from the elimination of the label pre-approval process. The post-review of labels used by a licensee is already a part of the standard audit program and will continue.

Consultation

The CCRA and the Department of Finance carried out extensive consultations with members of the affected industries, the Royal Canadian Mounted Police (RCMP) and other government departments after the draft regulations were released in December 2001.

The RCMP and the CCRA Laboratory and Scientific Services Directorate expressed some concern regarding the elimination of the label pre-approval process as this databank has been utilized in the past to identify legitimate labels. The CCRA will not be maintaining an ongoing databank of labels approved for legitimate use.

However, the benefits of removing the burden of the pre-approval process for licence holders outweigh the infrequent use of the existing databank. In addition, all legitimate labels will continue to be held by the spirit and wine licence holders and will still be available for verification purposes at those premises, as required.

Following pre-publication of these Regulations in the Canada Gazette, Part I, on March 29, 2003, Vol. 137, No. 13, an inquiry was received from Cascadia Brands Inc. Although Cascadia expressed support for these Regulations, they have requested a three-year transitional period to deplete their existing labels. An administrative policy allowing for the depletion of existing labels by December 31, 2003, will be extended to July 1, 2004, in response to their inquiry. This administrative policy will allow alcohol licensees adequate time to comply with the new labelling requirements.

Compliance and Enforcement

CCRA auditors will monitor compliance with these Regulations on a post-review basis.

A licensee who fails to display all the required information is liable to an administrative penalty up to $25,000 under section 250 of the Act.

Contact

• Mr. Mark Hartigan
  Manager, Excise Act, 2001 - Implementation
  Excise Duties and Taxes Division
  Excise and GST/HST Rulings Directorate
  Policy and Legislation Branch
  Place de Ville, 20th Floor
  320 Queen Street
  Ottawa, Ontario
  K1A 0L5
  Telephone: (613) 954-5894
  FAX: (613) 954-2226

Footnote a 

S.C. 2002, c. 22

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