3ARoyalty

3A Royalty

(1) Subject to subsection (2), a reference in this Act to payment of a royalty, in relation to goods, is a reference to payment of an amount of royalty in respect of goods that occurs at a time when the goods are neither excluded goods nor exempt goods. (2) Where: (a) a person pays an amount of royalty in respect of goods at a time when the goods are excluded goods or exempt goods; and (b) the payment is made in connection with a scheme entered into or carried out for the purpose of enabling any person to avoid liability to pay an amount of sales tax that would have been, or might reasonably be expected to have been, payable in respect of the goods; the payment shall be deemed, for the purposes of this Act, to have been made at a time when the goods were neither excluded goods nor exempt goods. (3) For the purposes of subsections (1) and (2), an amount of royalty that is paid in respect of goods and another matter shall, to the extent to which it is attributable to the goods, be deemed to be paid in respect of the goods. (4) For the purposes of this Act, where a non‑resident pays an amount of royalty in respect of goods at the request of, or under an arrangement with, a resident, then, unless the Commissioner otherwise directs, the resident shall be deemed to pay, and the non‑resident shall be deemed not to pay, the amount of royalty. (5) A reference in this section to royalty is a reference to an amount, however described or computed, that is paid by a person (whether the payment is periodical or not) to the extent to which the amount is paid by way of royalty (or like payment) as consideration for: (a) the doing of, or the right to do, any act that would constitute an infringement of copyright if done without the licence of the owner of the copyright, other than an act consisting of: (i) performing a work; (ii) broadcasting a work, sound recording or cinematograph film; (iii) causing a cinematograph film, a work, or a television program that includes a work, to be transmitted to subscribers to a diffusion service; (iv) causing a sound recording to be heard in public; (v) causing a cinematograph film to be seen in public; or (vi) exhibiting an article in public; (b) the making, use, exercise or vending of an invention or the right to make, use, exercise or vend an invention; (c) the use of, or the right to use: (i) a design or trade mark; (ii) confidential information; or (iii) machinery, implements, apparatus or other equipment; (d) the supply of scientific, technical, industrial, commercial or other knowledge or information; (e) the supply of any assistance that is ancillary and subsidiary to, and is furnished as a means of enabling the application or enjoyment of, any matter falling within any of the foregoing paragraphs; or (f) a total or partial forbearance in respect of any matter falling within any of the foregoing paragraphs (including paragraph (e)). (6) Where goods are manufactured or sold subject to the payment of a royalty, a reference in this Act, in relation to the ascertainment of the sale value of the goods, to: (a) the amount for which the goods are sold or purchased; (b) the amount for which the goods could reasonably be expected to have been sold or purchased; (c) the amount for which identical goods could reasonably be expected to have been sold or purchased; (d) the amount charged to a person by another person in respect of the goods; (e) a particular value of the goods; (f) the amount of wages paid in respect of the manufacture of the goods; or (g) the amount payable in respect of the manufacture of the goods; shall be read as including a reference to: (h) except where paragraph (j) or (k) applies—such amount as, in the opinion of the Commissioner, is the value of the royalty; (j) in the case of a reference to the amount of wages paid in respect of the manufacture of the goods: (i) where the reference occurs in the first proviso to subsection 18 (2)—57%; or (ii) where the reference occurs in the proviso to subsection 18 (3)—83%; of the amount that, in the opinion of the Commissioner, is the value of the royalty; or (k) in the case of a reference to the amount payable in respect of the manufacture of the goods—75% of the amount that, in the opinion of the Commissioner, is the value of the royalty. (7) For the purposes of this section: (a) an expression used in paragraph (5)(a) has the same meaning in that paragraph as in the Copyright Act 1968, but cinematograph film, in addition to the meaning given by that Act, includes a video tape or video disc; (b) an expression used in paragraph (5)(b) has the same meaning in that paragraph as in the Patents Act 1990; (c) design means a design of a kind capable of being registered under the Designs Act 1906, whether or not it is registered under that Act or any other law; and (d) trade mark means a mark of a kind capable of registration under the Trade Marks Act 1955, whether or not it is registered under that Act or any other law, but does not include a mark that relates to a service. (8) In this section: