CHAPTER 2.  

IMPORT DUTIES AND LICENSES

ARRANGEMENT OF SECTIONS

Section PART I - PRELIMINARY §201. Short title. §202. Application of the Chapter. §203. Interpretation.

PART II -LIMITATION; NUMBER OF IMPORTERS OF ALCOHOL AND TOBACCO PRODUCTS §203A Prohibition against importation without license. §203B License to Import Alcohol and Tobacco. §203C Invitations to Bid for a License. §203DNumber of Licenses Authorized. §203E Register. §203F Modification; Suspension; Revocation. §203G Authority of Secretary of Finance.

PART III- IMPORT DUTY §204. Imposition or duty. §205. Payment of duty.

PART IV - EXEMPTIONS §206. General exemptions. §207. Reserved §208. Re-exports.

209. Goods in transit.

PART V - ADMINISTRATION §210. First port of entry. §211. Delivery of manifest.

Section §212. Entry of goods. §213. Payment of duty and release. §214. Lost and damaged goods.  

§214A. Labeling of food items and prohibition.

PART VI - ENFORCEMENT §215. General powers and duties of Customs Officers. §216. Boarding of vessels and aircraft, inspections. §217. Agreements to limit powers; void. §218. Duty to assist. §219. Immunity. §220. Regulations, Coordination of Implementation.

PART VII - OFFENSES AND PENALTIES §221. Release of goods without clearance. §222. Failure to comply with requirements, etc. §223. Penalties.

PART VIII- MISCELLANEOUS §224. Regulations. §225. Forfeiture. §226.Facilities. §227. Funding for CMI §228. Incentive Fee.

Schedule 1: Rates  of Import Duties Schedule 2: Certificate of Exemption for RE and EE

An Act to provide for the imposition of import duties on goods imported into the Republicof the Marshall Islands and for matters connected therewith. [This Chapter was previously codified at 11 MIRC 5A].

Commencement: 14 April 1989 Source: P. L. 1989-49

P. L. 1989-60

P. L. 1990-102

P. L. 1992-25

P. L. 1994-77

P. L. 1995-119

P. L. 1996-16

P. L. 1996-25

P. L. 1997-30

P. L. 1997-40

P. L. 1998-68

P. L. 1999-80

P. L. 2001-43

P. L. 2002-52

P. L. 2004-16

P. L. 2004-5

P. L. 2005-38

P. L. 2005-40

P. L. 2006-74

P. L. 2007-87

2008-3

2008-5

2011-52

2011-54

PART I - PRELIMINARY

§201. Short title. This Chapter may be cited as the “Import Duties Act 1989".[P.L. 1989-49, §1.]

 §202. Application of the Chapter.

This Chapter does not apply to or in relation to the importation of goods to the United StatesArmy Kwajalein Atoll (USAKA).[P.L. 1 989-49, §2.]

§203.       Interpretation.

In this Chapter, unless the context otherwise requires:

(a) “Aircraft” means any contrivance used or capable of being used for flight throughthe air. Aircraft is included in the definition of the term “vessel” unless the context requiresotherwise;

(b) “Chief” means the Chief of Customs Division;

(c) “consumable” means goods imported for the direct consumption by householdsfor personal needs not utilized for further production or manufacture;

(d) “Controlled Substance” means:

(i) any goods which have been declared illegal or limited in possession by theNitijela including, but not limited to:

(1) consumable alcohol and beverages containing alcohol;

(2) narcotics; and

(3) cigarettes;

(ii) substances proscribed by the Convention on Psychotropic Substances;

(iii) prescription drugs; and

(iv) substances or items controlled by the Vienna Convention for theProtection of the Ozone Layer;

(e) “Customs Officer”  means an employee of the Department of Revenue and

Taxation who has been designated as a customs officer by the Chief or anyone who isdeputized as such an officer by the Chief or any designated Customs Officer employee;

(f) “Goods” means all property;

(g) “Minister” means the Minister of Finance;

(h) “raw material” means materials which are imported for the specific purpose ofusing as inputs in the production of semi-manufactured or manufactured goods;

(i) “Republic” means the Republic of the Marshall Islands;

(j) “semi-manufactured goods” means goods imported for the purpose of using asinputs in the production of finished consumer goods;

(k) “smuggled goods” means goods imported with intent to defraud the revenue;

(l) “smuggling” means importing goods with intent to defraud the revenue;

(m) “supplies” means goods, other than consumable goods, used as a provision andclothing includes goods offered for sale; and

(n) “vessel” means every description of craft or other contrivance used or capable of

being used for transportation including aircraft, unless the context requires otherwise.  [P.L. 1989-49, §3; amended by P.L. 1990-102, §2(1); P.L. 1994-77 §2(1); re-lettered alphabetically; subparagraphs (k) and

(K) added by P.L. 1998-68 § 2.]

                       PART  II -LIMITATION ON THE NUMBER OF IMPORTERS

§203A. Prohibition against Importation without a License

(1) Notwithstanding the provisions of any other Act to the contrary, no person corporationor any other business association or entity shall have the authority to import into the Republic, anyalcohol or alcohol based products or any tobacco, or any other tobacco based products, without theapproval of the Secretary of Finance.

(2) Such approval shall be issued in the form of a license or licenses, pursuant to theprovisions of this Part.

(3) Any person, corporation or any other business association or entity that violates theprohibition set out in subsection (1) above shall be liable to the penalties set out under Sections 203Fand 223 of this Act. [Amended by P.L. 2006-74].

§203B. License to Import Alcohol and Tobacco Products

(1) Anyperson, corporation or anyother business association or entitywho  intends to importany alcohol and alcohol based products, tobacco, and any other tobacco based products, for re-salewithin the Republic shall first apply to the Secretary of Finance, for license  to import such goodsunder this part. The Secretary of Finance shall issue separate licenses for the importation of alcoholand alcohol based products and for the importation of  tobacco and tobacco based products.

(2) Such licenses shall be in a form approved by the Secretary of Finance.

(3) The application for a  license under this part shall contain:

(a) the name of the applicant’s business;

(b) the applicant’s principal place of business in the Republic and its authorizedrepresentative for purposes of the application;

(c) the purpose, scope, and objectives of the business activities to be                 conducted by the applicant;

(d) the proposed form of the business organization, including the  ownership and management structure;

(e) the names, addresses, and citizenship of the initial owners and managers;

(f) proposals for ownership and management by citizens of the Republic;

(g) proposals to give employment preferences to citizens of the Republic and to traincitizens of the Republic for positions in management and at other levels;

(h) anticipated capital contributions, revenue and expenditure for the first three (3)

years;

 (i) any other information that Secretary of Finance deems necessary or appropriate.

(4) Any person, corporation or other business association or entity:

(a)  that has past due and outstanding taxes under the laws of the Republic;

(b)   that has failed to fulfil any arrangement with the Secretary of Finance to settle

any past due and outstanding taxes ;shall not be eligible to apply for a license under this Part.

§203 C Invitations to Bid

(1) The Secretary of Finance shall solicit applications for a license under this Part, throughan invitation for bids.

(2) The Invitation for bids shall contain:

(a) an invitation to all those persons, corporations or other business associations or entities intending to import alcohol and tobacco products to submit anapplication pursuant to Section 203B above.

(b) terms and conditions of the license, any fees payable under this Part and any other information deemed necessary by the Secretary of Finance; and

(c) a request for the production of any background information on the applicant andany other information deemed necessary by the Secretary of Finance;

(3) Adequate public notice of the Invitation for Bids shall be given by the Secretary ofFinance, and may include publication in a newspaper of general circulation for a reasonable periodof time.

(4) Upon receipt of the applications, the Secretary of Finance shall review the applicationspursuant to the provisions of this Part.

§203 D Number of Licenses Authorized under this Part

(1) The Secretary of Finance is hereby authorized to issue:

(a)  no more than thirty (30)  licenses for the importation of alcohol and alcohol based products each financial year; and

(b) no more than thirty (30) licenses for the importation of  tobacco and tobacco based products each financial year;

(2) Except for the initial licenses, all licenses shall take effect on October 1^st   and remain in force for a period of twelve months.

(3) At the expiration of such period, the Secretary of Finance shall again, solicit applicationsthrough an invitation  for bids  pursuant to the provisions of Section 203C above and anyRegulations promulgated pursuant to this Part.

(4) Where the Secretary of Finance determines that more than fifteen applicants   are equally

qualified, the Secretary of Finance shall decide the outcome by a drawing of lots.[Amended by P.L. 2005­40]

§203E Register.

(1) The Secretary of Finance shall maintain a register of all persons, corporations or businessassociations and entities that have been duly licensed to import goods under this part.

(2) All license holders under this Part shall advise the Secretary of Finance of anychanges in their circumstances to allow for the appropriate amendments or modifications to the dataon the license holder, contained in the register.

§203F Modification, suspension, or revocation.

(1) A license granted under this Part  shall at all times be subject to modification, suspension, or revocation where:

(a) the application  is found to have contained false or fraudulent information;

(b) the grantee presented false or fraudulent information to Secretary of Finance in support of his application;

(c) the grantee violates any of the laws of the Republic of the Marshall Islands;

(d) the grantee engages in business activities which are in violation of any conditionor terms imposed in the license: and

(e) the grantee engages in business activities outside of the scope of the license.

§203G Authority of Secretary of Finance

In addition to the  provisions of this Part, the Secretary of Finance is hereby   authorized to formulate and adopt Rules and Regulations pursuant to the Administrative Procedures Act, for theadministration of the provisions of this part. Such authority shall include but is not limited to:

(a) the formulation of a list of prerequisites, or standards of compliance, necessaryfor the issuance of a license under  this Part; 

(b) the formulation of  a procedure to govern the bid process;

1

PART III - IMPORT DUTY

 §204. Imposition of duty.

There is hereby imposed an import duty on the goods imported into the Republic at the ratesspecified in the Schedule 1 appearing at the end of this Chapter. [P.L. 1989-49, §4.]

§205. Payment of duty.

(1) Import duty payable on any goods must be paid, or arrangements satisfactory to the Chief,Revenue and Taxation must be made, before the goods are released from the control of Customs.

(2) Until such time as the goods imported are cleared under Subsection (1) of this Section,they shall remain under the control of Customs.

(3) The Chief may license warehouses wherein goods may remain under Customs controluntil such time as the owner of the Goods may wish to enter them in conformance with thisChapter.[P.L. 1989-49, §5; Subsection (3) added by P.L. 1998-68, §2.]

PART IV²   - EXEMPTIONS

§206. General exemptions.

(1) The following goods imported into the country are exempt from import duty:

(a) goods imported by a passenger or a member of the crew of a vessel or aircraft, being:

(i) wearing apparel, toiletries, personal jewelry, medicinal preparations andother such goods for immediate personal use of the passenger or the member of thecrew or his family and not for resale up to the value of three hundred dollars (US$300);

(ii) not more than three hundred (300) cigarettes, seventy-five (75) cigars, oreight (8) oz. of smoking tobacco, for personal consumption and not for resale;

(iii) not more than (2) liters of distilled alcoholic beverages, for personalconsumption and not for resale; or

(iv) gifts not exceeding three hundred dollars (US $300) in value.

(b) bona fide stores of the vessel or aircraft, being goods required for the use of thepassengers and crew of the vessel or aircraft while on board in such quantities as approvedby the Chief;

(c) goods imported in any one (1) consignment on which the total duties or taxesliable do not exceed twenty ($20) dollars; and

(d) goods imported by churches for their own religious, educational, or charitablepurposes, subject to satisfactory evidence or security as may be required by the Chief.

(2) Commercial travelers samples must be cut, mutilated, spoiled or otherwise treated, to thesatisfaction of the Customs Officer, so as to make them unmerchantable.

 (3) No import duty shall be levied on  lubricating oil and diesel fuel oil imported by, for, or on behalf of, or sold to the Kwajalein Atoll Joint Utility Resource, Inc. (KAJUR) solely for thepurpose of power generation. If import duties have been paid by an original importer, and residualfuel oil or diesel oil is subsequently resold to KAJUR for the purpose of power generation, then theoriginal importer shall be entitled to a refund of import duties previously paid on that residual fueloil or diesel oil.

(4) Notwithstanding any other provision in this Act to the contrary, the Marshall IslandsEnergy Company (MEC) shall be exempted from the payment of import duty tax on the importof all types of fuel into the Republic, including fuel imported for power generation and forcommercial re-sale.[P.L. 1989-49, §6; Subsection (3) amended by P.L. 1995-119, §2(1), and P.L. 1997-40,  §2;

Subsections 1(c-e) amended by P.L, 1998-68, § 2.][Amended by P.L. 2005-38, removing exemption for governmentpurchases and adding new (4)][subsection (3) and (4) amended by P.L. 2008-5]

§206A.             Exemption for Renewable Energy (RE) and Energy Efficiency (EE)equipments.

(1) No import duty shall be levied on Renewable Energy equipments (initially, warrantedsolar hot water heaters, photovoltaic (PV) panels, array frames, regulators, inverters, completesolar PV kits including batteries, or wind turbine kits) imported into the Republic of the MarshallIslands for the purposes of power generation.

(2) No import duty shall be levied on Energy Efficient equipments (initially airconditioning units, refrigerators and freezers, fluorescent and LED lightings) which have anEnergy Star label or equivalent, imported into the Republic of the Marshall Islands for thepurposes of provision of services using electrical power.

(3) Subsection (1) and (2) shall apply to the residential, commercial and government sectors.

(4) Any person who is granted exemption under Subsections (1) and (2) shall sign aprescribed form that certifies the imported RE & EE equipment complies, and declares therebyon the certificate the right of government officers to inspect the equipment. The prescribed formis set out in Schedule 2 at the end of this Chapter. [P.L. 2011-52, §6A]

§207. Reserved [“Exemptions for Industries and Hotels” repealed in entirety by P.L. 2002-52,]

§208.             Re-exports.

(1) A person who imports goods into the Republic for the purpose of re-export is entitled toa refund of import duty paid on the goods, on proof to the satisfaction of the Chief that:

(a) the goods were declared in the entry certificate presented under Section 212 (2)(b)of this Chapter to have been imported for re-export;

(b) the goods re-exported are identical with goods so declared;

(c) the goods were re-exported to a buyer outside the Republic and were purchasedby him; and

(d) the import duty due on the goods at the time of import has been paid.

(2) Notwithstanding the provisions of Subsection (1) of this Section, the Chief may, underspecial circumstances, refund an amount not exceeding seventy-five (75%) of the duty paid on any

goods re-exported on proof to the satisfaction of the Chief that:

(a) the goods were entered and import duty has been paid at the time of importation;

(b) the goods were re-exported to a buyer outside the Republic and were purchasedby him;

(c) the goods re-exported are identical with the goods referred to in Paragraph (a) ofthis Subsection; and

(d) the refund of duty claimed is over five hundred dollars (US $500).   [P.L. 1989-49, §8; amended by P.L. 1998-68, §2.]

§209. Goods in transit.

Goods that are in transit from a place outside the Republic to another place outside theRepublic are subject to the control of Customs, and are not subject to import duty. [P.L. 1989-49, § 9.]

PART V³ -ADMINISTRATION

§210. First port of entry.

(1) A vessel or aircraft entering the Republic must obtain Customs clearance from the firstport of entry before calling any other port, except in case of emergency or when authorized by theMinister, in which case Customs clearance must be obtained as soon as practicable.

(2) In this Section, “first port of entry” means an official port of entry declared under theexisting law. [P.L. 1989-49, §10.]

§211. Delivery of manifest.

(1) On the arrival of a vessel or aircraft at the first port of entry, the master, owner or agentof the vessel or aircraft shall, in accordance with Subsection (2) of this Section, deliver to a CustomsOfficer one copy of the manifest and bills of lading, and shall also deliver a true copy of anycorrection of the manifest and bills of lading, filed on the entry of his vessel or aircraft.

(2) The documentation referred to in Subsection (1) of this Section shall be delivered:

(a) in the case of a vessel, before or within one hour after it is docked and secured, and

(b) in the case of an aircraft, immediately upon its arrival and before any passengersor goods are loaded.

(3) All cargo, including ship or aircraft stores and transit cargo, but not includingaccompanied passenger personal effects, must be included in the manifest and bills of lading.

(4) In addition to the documents at Subsection (1) of this Section, the master, owner or agentshall deliver to a Customs Officer a declaration of all dutiable personal items held by each crewmember, together with the ship or aircraft stores list. [P.L. 1989-49 § 11; amended by P.L. 1998-68, §2.]

§212. Entry of goods.

(1) Except as otherwise provided in this Chapter or in the regulations made under Section224 of this Chapter, the consignee of any imported goods shall make entry of the goods, eitherpersonally or by an agent authorized by him, at the Office of the Chief, Revenue and Taxation, orsome other place designated by the Chief for the purpose, within a reasonable time after the arrivalof the importing vessel or aircraft.

(2) Entry may be made by presentation to the Customs Officer of:

(a) a non-negotiable copy of the bill of lading along with the shipper’s load and countand vendor’s invoices covering all goods arriving on the vessel or aircraft and consigned tothe consignee; and

(b) an entry certificate signed by the consignee and verified by affidavit, certifying that:

(i) the vendor’s invoices are correct;

(ii) no alterations have been made to  them; and

(iii) if appropriate, the goods are imported for the purpose of export.

(3) If proper documentation is not available within a reasonable time after the arrival of thegoods, the estimated import duty, as assessed by the Customs Officer, shall be paid, subject toadjustments when the documents arrive.  [P.L. 1989-49, §12.]