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Ministry of Finance Notice: Draft Amendments to Articles 4, 11, and 18 of the "Standards of Minor Breaches for the Application of Customs Anti-Smuggling Act"
On February 26, 2025, the Ministry of Finance announced the draft amendments to Articles 4, 11, and 18 of the "Standards of Minor Breaches for the Application of Customs Anti-Smuggling Act". The public notice period extends for 60 days from the day following its publication in the Executive Yuan Gazette, expiring on April 28, 2025. During this period, the public may submit opinions and inquiries to the Customs Administration of the Ministry of Finance.
Under Article 39-1 of the current Customs Anti-smuggling Act, penalties are imposed on "declared" import and export goods that infringe intellectual property rights, with no exemption for minor offenses. The provision states the following: "For import and export goods under customs declaration that infringe patent rights, trademark rights, or copyrights, excluding genuine parallel imports, a fine of up to three times the value of the goods shall be imposed, and the goods shall be confiscated, unless otherwise specified by other laws." However, for "undeclared" goods, Articles 36 (1) and 36 (2) of the Customs Anti-Smuggling Act currently apply. If the dutiable value of imported goods or the FOB value of exported goods does not exceed NT$5,000, the first paragraph of Article 4 of the "Standards for Reduction or Exemption of Penalties in Customs Anti-Smuggling Cases" allows for an exemption from penalties, with the only consequence being the confiscation of the infringing goods. This creates a disparity where "'declared goods' are subject to fines, while 'undeclared' goods may be exempted" leading to an imbalance in enforcement.
To strengthen border control measures and combat intellectual property infringement, the amendment to Article 4 of the "Standards for Reduction or Exemption of Penalties in Customs Anti-Smuggling Cases" introduces a proviso specifying that goods infringing patents, trademarks, or copyrights (excluding genuine parallel imports)" are not eligible for the NT$5,000 exemption.
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For cases subject to fines under Article 36(1), 36(2), or 37(3) of this Act, if the dutiable value of imported goods or the FOB value of exported goods does not exceed NT$5,000, the fine shall be exempted. However, this exemption shall not apply to goods such as firearms, ammunition, drugs, or those infringing patents, trademarks, or copyrights (excluding genuine parallel imports), nor to individuals who have committed the same violation three or more times within a year. |
For cases subject to fines under Article 36(1), 36(2), or 37(3) of this Act, if the dutiable value of imported goods or the FOB value of exported goods does not exceed NT$5,000, the fine shall be exempted. However, this exemption shall not apply to goods such as firearms, ammunition, or drugs, nor to individuals who have committed the same violation three or more times within a year. |
Additionally, the amendment to Article 11 of the "Standards for Reduction or Exemption of Penalties in Customs Anti-Smuggling Cases" reflects changes in the Act for the Establishment and Administration of Science Parks, updating references from "Export Processing Zone" to "Science Park" and transferring the jurisdiction from the "Export Processing Zone Administration of the Ministry of Economic Affairs" to the "Industrial Park Administration of the Ministry of Economic Affairs." The amendment to Article 18 revises certain wording related to the effective date to align with legislative drafting conventions.