June 2014

What is the Importation of Intoxicating Liquors Act?

The Importation of Intoxicating Liquors Act (IILA) is a federal statute governing the interprovincial transportation and international importation of intoxicating liquors. The IILA was enacted in 1928 at the request of the provinces after the repeal of their liquor prohibition laws. This legislation controls and restricts the movement of liquor from one province to another, as well as its importation into Canada. By requiring that importations be made by provincial liquor authorities, the IILA provides provinces with the umbrella of federal authority to control imports into their jurisdictions.

Importations of alcohol into the territories are governed by the federal enabling statute for each territory.

The amendment

On June 28, 2012, an amendment to subsection 3(2) of the IILA was made by adding paragraph (h) to allow Canadians to take wine across provincial boundaries for their personal use. Paragraph 3(2)(h) of the IILA has been further amended to add beer and spirits.

Amended paragraph 3(2)(h) reads as follows:

(h) the importation of wine, beer or spirits from a province by an individual, if the individual brings the wine, beer or spirits or causes them to be brought into another province, in quantities and as permitted by the laws of the other province, for his or her personal consumption, and not for resale or other commercial use.

Overview

The amendment removes the federal barrier prohibiting individuals from moving beer from one province to another when it is for their personal use. While the federal impediment has been removed, there is no change to the province's authority to set limits on personal importations of beer.

The provincial authorities include the ability to set limits relating to:

• quantities;
• means of access such as accompanying the person, direct-to-consumer sales by Internet or telephone, etc.;
• age limits;
• social needs such as respecting dry zones.

The amendment does not affect the federal or provincial authority to tax beer. This means that it does not create an exemption from federal or provincial duties, fees, taxes or mark-ups, etc.

Impact on federal regulations for licensed brewers

There are no changes to either the federal taxation or regulation of beer. There will be no change to the reporting of beer transactions by licensees under the federal Excise Act.

Impact on provincial regulations for beer

The amendment does not affect the provincial regulation of beer. The provinces maintain the authority to regulate the possession, movement and sale of beer into their jurisdictions.

Impact on territorial regulations for licensed brewers

The amendment does not affect the territorial regulation of beer, as the IILA does not govern the importation or movement of beer into the territories.

Impact on foreign beer

There is no change for the importation of foreign beer into Canada. Other countries continue to have access to the Canadian market for non-commercial shipments of beer in accordance with the Customs Act, the IILA and agreements between provinces and the Canada Border Services Agency.

Once legally imported into Canada, foreign beer will be provided the same interprovincial treatment as domestic beer, in accordance with provincial requirements.

Further information

Specific information relating to the movement of spirits within Canada for personal use is available in Excise Duty Notice EDN38, Budget 2014 – Amendment to the Importation of Intoxicating Liquors Act for the Movement of Spirits between Provinces.

Specific information relating to the movement of wine within Canada for personal use is available in Excise Duty Notice EDN31, Amendment to the Importation of Intoxicating Liquors Act.

The Importation of Intoxicating Liquors Act is available at http://laws.justice.gc.ca/eng/acts/I-3/index.html.

For more information on this subject, contact your nearest regional excise duty office. A list of regional excise duty offices is available in Excise Duty Memorandum EDM1.1.2, Regional Excise Duty Offices.