Customs clarifies requirements for the duty-free importation of pharmaceutical materials imported for clinical trials

New Zealand Customs Service (NZ Customs) has reviewed the treatment of drugs and other material imported solely for the purposes of clinical trials.  Customs had previously allowed the entry of these goods as samples under Regulation 65 of the Customs and Excise Regulations 1996 (C&E Regs 1996). 

In order to meet the requirement under this regulation, goods must either be:

• A sample of the bulk of goods held subject to the control of Customs, or;
• A small sample intended for marketing purposes to indicate likely product demand, colour range, style, or similar purpose.

In either case, the chief executive may require that the goods are marked or put up in such a form as to render them unsuitable for sale as a condition for their release from the control of Customs.

Customs advises that:

• Where goods are imported under the Medicines Act 1981 for the sole purpose of obtaining clinical and scientific information with respect to its safety and efficacy, this will not normally satisfy the criteria under Regulation 65 of the C&E Regs 1996.
• Where the Chief Executive approves the release of samples from the control of Customs, Goods and Services Tax (GST) will still be payable where these have been imported by any person registered under the Goods and Services Tax Act 1985 for the purpose of carrying on that person’s taxable activity, if the person is entitled to make an input tax deduction under section 20(3) in respect of the goods.

Future importations of clinical trial material that do not meet the criteria for samples will need to be cleared through normal entry procedures. Any application of Regulation 65 will be considered on a case-by-case basis, and persons seeking release of goods as samples must provide sufficient information to satisfy the Chief Executive that the goods qualify as samples.