Customs looks ahead to enhance enforcement modes with internal and external collaboration (with photos)

10 Feb 2015

The Commissioner of Customs and Excise, Mr Clement Cheung, said today (February 10) at the Customs and Excise Department 2014 year-end review that the department has sought to further enhance efficacy in terms of enforcement and trade facilitation through implementation of structural reforms and strategic adjustments.

This was achieved with an analysis of changes in the external environment and of the developments and evolution of various illegal activities as well as closer co-operation with other agencies and enhanced co-ordination within the department.

For revenue collection on dutiable commodities, duty collected by the department in 2014 amounted to $9.7 billion, representing an increase of 6 per cent over 2013. Sixty per cent of the duty was from tobacco products ($5.8 billion), 36 per cent was from hydrocarbon oil ($3.5 billion) and the remaining 4 per cent was from alcoholic products ($380 million).

Mr Cheung said that a total of 255 smuggling cases were detected in 2014, representing a drop of 10 per cent when compared to 2013. Among the cases, 85 per cent involved smuggling activities between the Mainland and Hong Kong. Items seized were mainly mobile phones, tablet computers, electronic parts and photographic equipment.

Since the implementation of export control on powdered formula in March 2013, about 9 160 cases have been detected at control points with 89 000 kilograms of powdered formula seized. On endangered species, a total of 462 cases were detected during the year, with 138 300 kilograms of items confiscated. The confiscated items were mainly wood logs, weighing 124 600 kilograms, representing an 11-fold increase. On the other hand, the quantity of ivory tusks as well as pangolin and scales confiscated dropped by 72 per cent and 12 per cent respectively.

During the peak season of the Lunar New Year holidays, the department would allocate additional manpower to various control points and work in co-operation with other departments at hot spots of parallel trading activities in order to improve passenger flow and minimise the impacts of such activities on the community.

In addition, the department has strived to achieve greater knock-on effects through expansion of collaboration with various law enforcement agencies and application of the Organized and Serious Crimes Ordinance where appropriate, as well as enhanced co-operation between control points and the Syndicate Crimes Investigation Bureau.

For anti-narcotics work, the number of cases detected increased by 57 per cent to 808, of which 70 per cent were effected at the airport. A total of 1 035 kilograms of drugs were seized, representing a 1.4-fold increase. Among the seizures, 40 per cent were methylamphetamine (ice), 22 per cent were synthetic cathinone (bath salts) and 12 per cent were ketamine (K powder), and the seized amount of the former two showed an increase of 4 times and 12 times respectively.

Mr Cheung said the Customs Drug Investigation Bureau, after restructuring, shifted its focus from the local level to networking with the Mainland and at the international level. The upgraded Airport Investigation Group was provided with 21 additional officers. Coupled with interaction with the logistics, aviation and tourism industries, notable achievements were attained with 25 cases detected and 89 kilograms of drugs seized locally while follow-up investigations conducted in the Mainland and overseas attributed to the uncovering of 45 more cases and the seizure of another 222 kilograms of drugs.

In 2014, a total of 11 546 cases of illicit cigarettes were detected, representing an increase of 3 per cent. The number of significant cases was down by 24 per cent to 19, and that of illicit cigarettes seized also dropped by 42 per cent to 52 million sticks. However, the number of telephone ordering cases detected increased by 60 per cent.

Mr Cheung said this showed that a holistic enforcement approach was effective. The department would keep close contact with the Housing Department, building management offices and telecommunication service providers with a view to taking immediate action on reports of buying or selling illicit cigarettes, provision of phone numbers and distribution of handbills. Although tobacco duty was increased by 11.7 per cent last February, the number of public complaints and retail figures both suggested that illicit cigarette activities remained under control.

On intellectual property rights protection, a total of 850 infringement cases were detected last year, representing an increase of 18 per cent when compared to 2013. Mr Cheung said 185 of the cases involved Internet crime, which would be the focus of law enforcement in future. The department has stepped up co-operation with network service providers and auction sites, and is now developing a SocNet Monitoring System for online surveillance of illegal activities on social networking platforms.

The money service operator licensing system is operating satisfactorily. The first batch of licensees has started to renew their licences. Last year, nine cases of unlicensed operation were detected and nine persons were prosecuted.

The revenue from motor vehicle first registration tax increased from $7.5 billion in 2012 to $9.6 billion last year. The department is committed to eliminating illegal practices of vehicle sales to protect this important source of public revenue and maintain a level playing field. Apart from carrying out publicity activities, a free mobile app was rolled out to allow public access to the published retail prices of different vehicle models.

Mr Cheung said the number of enterprises accredited as Authorized Economic Operators increased by 10 to a total of 25 last year. The Mutual Recognition Arrangements (MRAs) with the Korea and Mainland Customs have been successfully implemented, and the negotiations with the Indian and Singapore Customs are making good progress. This year, the department will press ahead with the conclusion of MRAs with the Thai and Malaysian Customs, and actively participate in the Smart and Secure Trade Lanes Pilot Project advocated by the Mainland and the European Union.

On consumer protection, the department detected 58 cases related to short weighing, nine related to toys and children's products and seven related to general consumer goods. For unfair trade practices, prosecutions amounted to 72 cases, written undertakings were accepted under the civil compliance-based mechanism in five cases and warning letters were issued in another 12 cases, adding up to a total of 89 cases.

Mr Cheung said that since the enactment of the amended Trade Descriptions Ordinance, there had been a reduction in the use of some of the notorious unfair trade practices. The Special Duties Team specialising in complicated cases has been upgraded to an independent unit with an establishment expanded from 27 to 55. A new round of publicity featuring real-life cases would also be launched to raise consumer awareness and alertness.

Concluding his speech, Mr Cheung said that the department cracked down on 20 346 cases in 2014, a record high since 1997. The figure outnumbered that of 2013 by 1 446, representing an increase of 8 per cent. An apparent rise was noted in cases related to drugs, intellectual property rights and consumer rights.

The department has to stay one step ahead of the situation to successfully cope with the gradual extension of duties, the ever-changing environment and the evolving modalities of crime syndicates. Noticing that illegal activities will in future be driven by vibrant e-commerce trade and intensified personnel movements, the department has promptly devoted resources to cultivating external partnerships with all relevant sectors and expanding the international intelligence network. Other areas include fine-tuning the organisational structure and reinforcing internal collaboration, as well as introducing innovative ideas and a forward-looking mindset. With all these measures in place, the department is well equipped to serve the community with flexibility and efficiency and help maintain the stability and prosperity of Hong Kong.

Ends/Tuesday, February 10, 2015

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