´╗┐Customs 2009 year-end press conference (with photos)

4 Feb 2010

The following is a statement by the Commissioner of Customs and Excise, Mr Richard Yuen, at a Customs press conference to review its work in 2009 today (February 4):

The key responsibilities of the Customs and Excise Department are conducting customs clearance for import and export cargoes and taking enforcement action against offenders in breach of the law.

The Department's enforcement work which has direct impact on the public includes anti-smuggling, revenue protection (i.e. combatting illicit-cigarette and illicit-fuel activities), anti-narcotics, intellectual property rights protection and consumer rights protection.

In the past year, the Department detected a total of 21,074 cases, an increase of 4% over the year before, and arrested a total of 13,610 persons with seizures worth $930 million in total, a drop of 13% compared with the year before.

Similar to 2008, the duty on dutiable commodities collected by the Department in 2009 amounted to $6,240 million, half of which was from tobacco ($3,130 million), followed by hydrocarbon oil ($2,850 million).

The following is the enforcement situation of various cases in the past year:

Anti-smuggling

In 2009, the Department detected 224 smuggling cases, an increase of 3% over 2008. Goods worth $420 million in total were seized with 252 persons arrested.

The goods smuggled out of Hong Kong were mostly of high value, such as computers and related accessories, electrical appliances and electronic products (mobile phones in particular), fur and seafood, whereas those smuggled into Hong Kong were mainly illicit cigarettes and copyright infringing articles.

Revenue Protection

Since the increase of tobacco duty in February last year, the Department has stepped up its efforts to combat illicit cigarette activities at different levels. As a result, 8,419 illegal cigarette cases in connection with smuggling, storage, distribution, peddling and bringing in excessive duty-free cigarettes were effected, representing an increase of about 70% compared with the previous year. However, 61 million sticks of cigarettes in connection with these cases were seized in total, which represented a drop of about 20% compared with the previous year. This indicates that with the Department's enhanced enforcement, smugglers tended to reduce the quantity for smuggling or transaction each time in order to reduce their loss upon being detected. It is estimated that the price of illicit cigarettes also rose after the increase of the duty on tobacco, thereby reducing the demand for cigarettes to a certain extent.

To further clamp down on illicit cigarette activities, we have strengthened co-operation with law enforcement agencies on the Mainland and overseas with a view to combatting large-scale cross-boundary cigarette smuggling activities to intercept illicit cigarettes from the source. Moreover, we have strengthened publicity to encourage members of the public and the industry to report illicit cigarette activities. The public is also reminded that anyone involved in buying and selling of illicit cigarettes commits an offence. Buyers of illicit cigarettes will be charged and will have a criminal record once convicted. In 2009, buyers of illicit cigarettes were sentenced up to four months' imprisonment and fined up to $20,000, while sellers of illicit cigarettes were sentenced up to 18 months' imprisonment and fined up to $20,000.

On combatting illicit fuel, during the year, the Department effected 611 cases, a drop of 45% compared with the previous year. A total of 360 persons were arrested with seizure of 320,000 litres of illicit fuel. The duty potential involved was $720,000. The number of reports on illicit fuel dropped by 32%, indicating that the scale of illicit fuel activities is declining gradually.

Anti-Narcotics

On combating drug trafficking, the Department seized a total of 652 kilogrammes of various kinds of drugs in 2009, an increase of 8% in quantity over 2008. The largest drug seizure was ketamine, with a total of 380 kilogrammes seized, which was the largest amount in the past five years. This was attributed mainly to the seizure of 196 kilogrammes and 140 kilogrammes of ketamine by the Department at the Hong Kong International Airport and Man Kam To Control Point in July and September respectively. The second largest drug seizure was cannabis with a seizure of over 70 kilogrammes. As regards methylamphetamine (ice), the seizure recorded a 120% increase, to 31.5 kilogrammes compared with last year.

In 2009, 544 drug cases were detected with 491 persons arrested, representing a decrease of about 20% compared with 2008. Among the arrested, 49 persons were aged below 21, representing a drop of 26% compared with last year. It is believed that the stepped up enforcement at the various control points since the beginning of the year two years ago has created a deterrence to cross-boundary drug-trafficking and drug abuse activities.

Intellectual Property Rights Protection

In 2009, the Department detected a total of 7,387 copyright infringement cases, including 6,374 piracy cases, a drop of 17%, and 1,013 counterfeiting cases, comparable with the figure in 2008. In the piracy cases, articles worth about $70 million were seized and 1,105 persons were arrested. The seizures were largely pirated optical discs, with a total of 2.02 million discs. It is estimated that some 15 pirated optical disc retail shops remain at present.

For the counterfeiting cases, the Department arrested a total of 768 persons with seizures worth $93 million in total, a drop of 23% compared with the year before. The seized items were mainly electrical appliances and electronic products, clothes, watches and leather goods. The counterfeiting syndicates were mostly active in areas with heavy pedestrian flow, such as Yau Ma Tei, Tsim Sha Tsui and Mong Kok, and the sale activities were targeted mainly at tourists visiting Hong Kong.

With the increasing popularity of the Internet, a new illegal trend of selling counterfeit goods online has emerged. In 2009, the Department detected a total of 39 cases involving the sale of counterfeit goods on the Internet, a one-fold increase over 2008. Forty-four persons were arrested and articles worth $660,000 in total were seized. The counterfeit goods seized were mainly leather goods, clothes and watches. The arrestees were largely unemployed persons, housewives or students, and they were all operating on a low budget.

Consumer Rights Protection

Last year, the Department handled a total of 441 cases concerning violation of consumer protection and contravention of the Consumer Goods Safety Ordinance, an increase of 10% compared with 2008.

The Trade Descriptions Ordinance (Amendment) 2008 and its related subsidiary legislation, coming into effect in March 2009, aim to target the dishonest sales practices of retail shops (e.g. misleading price indications), and stipulated that shops selling products of diamond, gold, platinum and natural fei cui as well as five types of electronic products had to issue invoices containing clear product information. Subsequently, the Department stepped up inspection and law enforcement action. Over 3,300 inspections of shops, especially jewellery stores, shops selling dried seafood and Chinese herbal medicines and retailers of electronic products, were conducted to stop unscrupulous sales practices such as giving misleading information about prices, issuing invoices without clear product information, etc. During the year, there were seven cases in which the persons/shops involved were convicted. The maximum fine imposed for these cases was $35,000. Among them, a shop selling ginseng and dried seafood was fined $3,000 with goods worth $66,000 forfeited due to unclear displaying of weight units and price indications. Currently, we find that price indications of retail shops have improved noticeably.

In 2009, the Department took enforcement actions against short-weight activities and effected a total of 179 cases, an increase of 70% compared with 2008, and this has been on the rise for three consecutive years. The cases involved seafood, vegetables and fruits, as well as scrap for recycling. As a result, a total of 149 retailers/shop assistants and seven shops were convicted, including 45 scrap traders/shop assistants as well as 44 seafood retailers. Other industries included vegetable and fruit retailers, seafood restaurants and roasted meat retailers. The maximum fine imposed for these cases was $15,000. The weighing equipment concerned was also confiscated.

On the whole, drug trafficking, illicit-cigarette activities and intellectual property rights infringement remained under control in the past year. The Department had also stepped up enforcement action on consumer rights protection, focusing particularly on the illegal practice of short weighing.

Key Initiatives in the Year Ahead

Combatting Youth Drug Abuse

In support of the anti-narcotics activities launched by the Government, the Department will keep up its efforts against cross-boundary youth drug abuse and drug trafficking and, in particular, strengthen law enforcement during weekends and holidays. Apart from using advanced technology, including X-ray scanning system and ion scanners, to examine suspicious items, additional plainclothes officers will also be deployed at the control points to conduct surveillance on suspicious characters, and drug detector dogs will be flexibly deployed to sniff cross-boundary passengers, baggage and vehicles. Meanwhile, we shall also work more closely with law enforcement agencies on the Mainland to crack down on cross-boundary drug trafficking and interdict drug supplies at source.

Combatting Illicit-Cigarette Activities

The Department will continue to combat illicit-cigarette activities at different levels, especially direct sales activities by means of "flyers distribution and telephone orders". We shall also strengthen publicity to remind people that both buying and selling of illicit cigarettes are criminal offences, the maximum penalty for which is a fine of $1 million and imprisonment for two years, and that they should not attempt to be involved in such illegal activities.

Implementation of the Road Cargo System

The Road Cargo System (ROCARS), to be rolled out at all land boundary control points in the first quarter this year, will provide speedier and more convenient customs clearance services to cross-boundary truck drivers to achieve seamless clearance. With the full implementation of ROCARS, advance electronic customs declaration for air, road and sea cargoes can be made in Hong Kong, thereby facilitating the clearance of multi-modal transshipment cargoes. This will ensure a smooth cargo flow and enhance the efficiency of the local logistics industry, which is conducive to the trade and business development of Hong Kong and the consolidation of Hong Kong's position as a logistics centre.

Strengthening Consumer Rights Protection

In view of the situation that some shop operators still engage in business malpractices involving misleading descriptions or short weighing, the Department will step up inspections, targeting especially shops, merchandise or trades which are subjects of frequent complaints. We shall promote the message of fair dealing through the media and call on the public to report illegal practices to the Department.

Intellectual Property Rights Protection

With the rapid development of Internet services, the Government has already conducted a review and public consultation on how to "strengthen copyright protection in the digital environment". The Department will render active support at law enforcement level and continue to work closely with the Internet service providers to track down online infringement activities. At the same time, the effectiveness of surveillance on and detection of online infringement activities will be continuously enhanced through staff training and application of technology.

Stepping up Anti-Smuggling Efforts

The Department will continue to work closely and exchange intelligence with the law enforcement departments on the Mainland and conduct intensive investigation targeted at syndicated operations in a bid to stop smuggling activities. The Department will also step up joint patrols with the Police Force at sea to combat sea smuggling.

Customs Headquarters Building

Lastly, the Customs and Excise Department reached a historical milestone in 2009 as it celebrated the centenary of its establishment. This year will be another milestone for the Department as the new Customs Headquarters Building at Java Road, North Point, is expected to be completed by the end of the year. Upon the commissioning of the building, the dispersed Customs offices will be put under one roof, significantly enhancing the Department's management and work efficiency and also turning a new page in our development.

Thank you.

Ends/Thursday, February 4, 2010

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