The Queen v. Lam Veng-chan

HCMA001109/1986

BETWEEN

Coram: Roberts, C. J.

Date: 2nd December, 1986

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JUDGMENT

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1. The Appellant appeals against the fines imposed by a magistrate for offences to which a plea of guilty was entered on behalf of the Imprint Company Ltd, which appeared by an appointed representative.

2. The Company was visited by officers from the Customs and Excise Department as a routine matter, and the offences to which it pleaded guilty were revealed by an examination of its records.

3. Of the ten offences, seven consisted of the giving of incorrect information, in an application for a Certificate of Origin, contrary to regulation 12(2)(b) of the Export Regulations, made under the Import and Export Ordinance. The other three were offences of making an untrue declaration in an application for the issue of an export licence, contrary to section 36(1)(a) of the Import and Export Ordinance.

4. The Magistrate, when fining the Defendant $5,000 on each charge, based his assessment of the penalty on the Marvels Clothing Co. Ltd⁽¹⁾ case, in which the Court of Appeal gave guidance to Magistrates as to the appropriate penalties to be applied for offences against section 36(1)(a). The maximum penalty for such an offence is $500,050 and imprisonment of 2 years. The Court of Appeal suggested that for this kind of offence, which can have a serious effect on Hong Kong's trading reputation abroad, it would be proper for the courts to consider a guideline of 40% of the value of the goods.

5. The Magistrate was correct to apply this scale of fines to the three offences under section 36(1). He was provided with particulars which show that the estimated value of the goods concerned was $44,000. 40% of that amount would be approximately $18,000, or about $6,000 for each of the three summons. This is so close to the actual fines of $5,000 imposed by the Magistrate that I do not think it proper to interfere with them.

6. The other seven offences, however, were against regulation 12 of the Export (Certificates of Origin and Commonwealth Preference Certificates) Regulations.

7. The maximum penalty for such an offence is $100,000 and imprisonment for one year, considerably below the maximum provided for offences against section 36.

8. This important distinction was not brought to the Magistrate's attention. If it had been, I am sure that he would have distinguished the amount of penalty imposed for offences under the Regulations from those imposed for offences under the section.

9. The Marvels⁽¹⁾ case refers to fines, for offences of this kind, being based on an assessment of the degree of profit, which the offender was likely to have secured if the transaction had been completed. This figure should be multiplied by 2½.

10. The agreed statement of facts estimates a net profit of $6,000 on all the transactions together. Counsel for the Crown has suggested that I should take an estimated net profit on the seven transactions offending the regulations, the total value of which was $98,000, as around $4,000. This is a figure I am prepared to accept.

11. On the Marvels formula, the correct level of fine should be a total of about $10,555, on the seven summons under the Regulations.

12. Rounding the amounts up, I will allow the appeal to the extent of quashing the fines on the first seven charges and imposing for the previous fine of $5,000 on each a fine of $1,500 on each. The total amount of fines to be paid by the Defendant will be $25,500 instead of $50,000.

(1) Application for Review No. 7 of 1984

Representation:

Appellant LAM Veng-chan on behalf of Imprint Co. Ltd.-in person

Mr. P.J. DYKES, s. c. c., for the Crown