1 HONG KONG LEGISLATIVE COUNCIL -- 12 July 1989 HONG KONG LEGISLATIVE COUNCIL -- 12 July 1989 1
OFFICIAL REPORT OF PROCEEDINGS
Wednesday, 12 July 1989
The Council met at half-past Two o'clock
PRESENT
HIS EXCELLENCY THE GOVERNOR (PRESIDENT)
SIR DAVID CLIVE WILSON, K.C.M.G.
THE CHIEF SECRETARY
THE HONOURABLE SIR DAVID ROBERT FORD, K.B.E., L.V.O., J.P.
THE FINANCIAL SECRETARY
THE HONOURABLE DAVID ALAN CHALLONER NENDICK, J.P.
THE ATTORNEY GENERAL
THE HONOURABLE JEREMY FELL MATHEWS, C.M.G., J.P. THE HONOURABLE ALLEN LEE PENG-FEI, C.B.E., J.P.
THE HONOURABLE DONALD LIAO POON-HUAI, C.B.E., J.P. SECRETARY FOR DISTRICT ADMINISTRATION
THE HONOURABLE MRS. SELINA CHOW LIANG SHUK-YEE, O.B.E., J.P. THE HONOURABLE MARIA TAM WAI-CHU, C.B.E., J.P.
THE HONOURABLE CHAN YING-LUN, O.B.E., J.P. THE HONOURABLE MRS. RITA FAN HSU LAI-TAI, O.B.E., J.P. THE HONOURABLE PETER POON WING-CHEUNG, O.B.E., J.P. THE HONOURABLE CHENG HON-KWAN, J.P.
THE HONOURABLE CHUNG PUI-LAM, J.P.
THE HONOURABLE HO SAI-CHU, M.B.E., J.P.
THE HONOURABLE HUI YIN-FAT, O.B.E., J.P.
THE HONOURABLE DAVID LI KWOK-PO, J.P.
THE HONOURABLE NGAI SHIU-KIT, O.B.E., J.P. THE HONOURABLE PANG CHUN-HOI, M.B.E.
THE HONOURABLE POON CHI-FAI, J.P.
PROF. THE HONOURABLE POON CHUNG-KWONG, J.P. THE HONOURABLE SZETO WAH
THE HONOURABLE TAI CHIN-WAH, J.P.
THE HONOURABLE TAM YIU-CHUNG
DR. THE HONOURABLE DANIEL TSE, O.B.E., J.P. THE HONOURABLE LAU WONG-FAT, M.B.E., J.P.
THE HONOURABLE GRAHAM BARNES, C.B.E., J.P. SECRETARY FOR LANDS AND WORKS
THE HONOURABLE MICHAEL LEUNG MAN-KIN, J.P. SECRETARY FOR TRANSPORT
THE HONOURABLE EDWARD HO SING-TIN, J.P.
THE HONOURABLE GEOFFREY THOMAS BARNES, C.B.E., J.P. SECRETARY FOR SECURITY
THE HONOURABLE PETER TSAO KWANG-YUNG, C.B.E., C.P.M., J.P. SECRETARY FOR ADMINISTRATIVE SERVICES AND INFORMATION
THE HONOURABLE MARTIN GILBERT BARROW, O.B.E. THE HONOURABLE PAUL CHENG MING-FUN
THE HONOURABLE MICHAEL CHENG TAK-KIN, J.P.
THE HONOURABLE DAVID CHEUNG CHI-KONG, J.P.
THE HONOURABLE MRS. NELLIE FONG WONG KUT-MAN, J.P. THE HONOURABLE MRS. PEGGY LAM, M.B.E., J.P.
THE HONOURABLE DANIEL LAM WAI-KEUNG, J.P.
THE HONOURABLE MRS. MIRIAM LAU KIN-YEE
THE HONOURABLE LAU WAH-SUM, J.P.
THE HONOURABLE LEUNG WAI-TUNG, J.P.
THE HONOURABLE KINGSLEY SIT HO-YIN
THE HONOURABLE MRS. SO CHAU YIM-PING, J.P.
THE HONOURABLE JAMES TIEN PEI-CHUN, J.P.
THE HONOURABLE PETER WONG HONG-YUEN, J.P.
THE HONOURABLE YEUNG KAI-YIN, J.P.
SECRETARY FOR EDUCATION AND MANPOWER
THE HONOURABLE NIGEL CHRISTOPHER LESLIE SHIPMAN, J.P. SECRETARY FOR HEALTH AND WELFARE
ABSENT
THE HONOURABLE STEPHEN CHEONG KAM-CHUEN, C.B.E., J.P. THE HONOURABLE CHEUNG YAN-LUNG, O.B.E., J.P. DR. THE HONOURABLE HENRIETTA IP MAN-HING, O.B.E., J.P. THE HONOURABLE MARTIN LEE CHU-MING, Q.C., J.P. THE HONOURABLE MRS. ROSANNA TAM WONG YICK-MING, J.P. THE HONOURABLE ANDREW WONG WANG-FAT, J.P.
THE HONOURABLE RONALD JOSEPH ARCULLI, J.P.
THE HONOURABLE RONALD CHOW MEI-TAK
DR. THE HONOURABLE LEONG CHE-HUNG
THE HONOURABLE JAMES DAVID McGREGOR, O.B.E., I.S.O., J.P. THE HONOURABLE MRS. ELSIE TU, C.B.E.
IN ATTENDANCE
THE CLERK TO THE LEGISLATIVE COUNCIL
MR. LAW KAM-SANG
Papers
The following papers were laid on the table pursuant to Standing Order 14(2): Subject
Subsidiary Legislation L.N. No.
Immigration Ordinance
Immigration (Places of Detention)
(Amendment) (No.8) Order 1989......................................... 224/89
Interpretation and General Clauses Ordinance
Specification of Public
Office............................................... 225/89
Peak Tramway (Amendment) Ordinance 1989
Peak Tramway (Amendment) Ordinance
1989 (Commencement) Notice 1989...................................... 226/89
Public Health and Municipal Services Ordinance
Pleasure Grounds (Regional Council)
(Amendment) By-Laws 1989................................................ 227/89
Public Health and Municipal Services Ordinance
Pleasure Grounds (Regional Council)
(Amendment)(No. 2) By-Laws 1989..................................... 228/89
Public Health and Municipal Services Ordinance
Public Health and Municipal Services
(Public Pleasure Grounds)
(Amendment of Fourth Schedule)
(No. 4) Order
1989............................................................. 229/89
Securities and Futures Commission Ordinance 1989
Securities and Futures Commission Ordinance 1989
(Commencement) (No. 2) Notice 1989.................................. 230/89
Shipping and Port Control
(Dwelling Vessels) Regulations
Shipping and Port Control
(Dwelling Vessels) Regulations
(Amendment of First Schedule) Order 1989........................... 231/89
Shipping and Port Control
(Dwelling Vessels) Regulations
Shipping and Port Control
(Dwelling Vessels)(Closed Areas) Order 1989....................... 232/89
Tax Reserve Certificates (Fourth Series) Rules
Tax Reserve Certificates (Rate of Interest)
(No. 5) Notice
1989............................................................. 233/89
Sessional Paper 1988-89
No. 80 -- 1988 Annual Report by the Commissioner of the Independent Commission Against Corruption
Address by Member
1988 Annual Report by the Commissoner of the Independent Commission Against
Corruption
DR. TSE: Sir, as Chairman of the Advisory Committee on Corruption, I am pleased to introduce the 1988 Annual Report by the Commissioner of the Independent Commission Against Corruption, which is tabled today in this Council.
Essentially the Operations Department meets its obligations by investigating all allegations of corruption, regardless of their origins. In 1988, the commission received a total of 2 253 corruption reports, 2% less than in 1987. The healthy trend of previous years with a steadily reducing number of reports involving government departments and public bodies continued.
On the other hand, allegations involving the private sector continued to increase and now account for about half of all the allegations involving corruption received by the commission. The cases the Operations Department was able to investigate were as complex and as time consuming as ever and the investigations frequently uncovered other offences associated with the corruption. These investigations often take
considerable time to complete and contribute to the high caseload which the Operations Department carries forward from year to year.
Altogether the number of persons prosecuted as a result of investigations by the department was 404, 21% less than in 1987. The conviction rate remained high at 76%. In addition 165 persons were cautioned rather than prosecuted for their offences.
The Corruption Prevention Department, which examines practices and procedures so as to reduce opportunities for corruption, completed 70 reports involving government departments and public bodies during the year. Of particular interest was that, at the same time the number of requests private sector companies made to the department for advice on anti-corruption measures, increased by 44% to 114.
The trends in respect of the private sector reflect, I believe, the successful efforts of the Community Relations Department, which is responsible for educating the public against corruption to encourage people to report their suspicions to the commission, rather than an indication of more corrupt activity in the private sector. During the year the department continued to use every channel available to get this message across in respect of corruption in both the public and the private sectors. The department's success in this respect has been well confirmed by public opinion surveys.
Finally, the commissioner has drawn attention in the report to the great help and advice given during the year by the various advisory committees to the commission.
Oral answers to questions
Consumer protection against emigration counsellors
1. MR. PETER WONG asked: Sir, will Government inform this Council what consumer protection measures, if any, are taken to protect Hong Kong people who wish to seek assistance from emigration specialists who hawk their skills and wares for reward in Hong Kong?
SECRETARY FOR ADMINISTRATIVE SERVICES AND INFORMATION: Sir, this is an area of consumer affairs where the guiding principle must be Caveat Emptor, that is, buyers beware.
The Hong Kong Government neither encourages nor discourages emigration consultants setting up business in Hong Kong, nor does it encourage or discourage Hong Kong people from using their services. The services available vary from filling forms outside consulates to mapping out an investment strategy to qualify as an investor. The decision on whether to consult, on what to consult, and how much it is reasonable to pay for the services provided, must be one for the individual to make.
Sir, I can only suggest that the best advice can probably be provided by the consulate of the country concerned.
Of course, if there is any evidence of a criminal act such as fraud or deception, then a report should be made to the police.
MR. PETER WONG: Sir, the "caveat emptor" answer given by the Secretary suggests that the Government does nothing to protect Hong Kong people in this hour of their need. Does this mean that the Securities and Futures Commission, the Registrar General's Department, amongst others, allow the flood of advertisements in the newspapers to go completely unchecked?
SECRETARY FOR ADMINISTRATIVE SERVICES AND INFORMATION: Sir, in the famous words of one of our illustrious former Financial Secretaries, "the Hong Kong Government believes that if something is not broken, do not try to fix it"; and this is an area falling into that classification. From 1 January 1987 to date, the Consumer Council has only received 11 complaints and this shows the size of the problem.
MRS. LAM: Do consulates in Hong Kong accept responsibility for the actions of immigration specialists from the countries they represent?
SECRETARY FOR ADMINISTRATIVE SERVICES AND INFORMATION: Sir, I have no knowledge of what the consulates do with respect to particular immigration consultants.
MR. DAVID CHEUNG: Sir, many of these immigration specialists are lawyers specializing in the immigration laws of their own countries. What measure of supervision, if any, does the Law Society or the Government of Hong Kong exercise over their activities?
SECRETARY FOR ADMINISTRATIVE SERVICES AND INFORMATION: Sir, I believe we are now wading in the area of foreign lawyers. I wonder whether I should not defer to the Attorney General?
HIS EXCELLENCY THE PRESIDENT: Attorney General, do you wish to add to that?
ATTORNEY GENERAL: Sir, if a foreign lawyer wishes to establish a business in Hong Kong under the present administrative arrangements, he must deliver an undertaking to the Law Society which will in turn enable the Immigration Department to issue a work permit to that lawyer. I know of no other arrangement under which lawyers from foreign countries may come here to practise law.
MR. PETER POON: Sir, in view of the fact that there have been complaints to the Consumer Council, has the council undertaken any study of the services rendered or
the products promoted by these immigration specialists, and can it offer any avenue of redress for an aggrieved investor?
SECRETARY FOR ADMINISTRATIVE SERVICES AND INFORMATION: Sir, the Consumer Council investigated each of the 11 cases and, in most cases, the results were rather inconclusive in that it involved a complaint of the service rendered not being in accordance with the original request for service. I could go into each case, but I think that would take too much time in this Council. Perhaps I could give Mr. Peter POON a reply in writing listing out the details of the 11 cases. (Annex I)
MR. TIEN: Sir, would the Secretary inform this Council whether any investigation by Government is currently taking place concerning deliberate fraud by any immigration specialist?
SECRETARY FOR ADMINISTRATIVE SERVICES AND INFORMATION: Sir, the authorities involved in such investigations do not maintain statistics in respect of fraud with particular reference to immigration statistics. However, we do have the total number of cases involving fraud.
MR. CHUNG: Sir, concerning advice given on investment strategy by immigration consultants, problems seemed to have arisen in the past when immigration scheme funds were hawked around in Hong Kong over what were styled public offerings and private placements. The former need a formal prospectus, while the latter do not. Would the Administration clarify what public offerings are and what private placements are?
SECRETARY FOR ADMINISTRATIVE SERVICES AND INFORMATION: Sir, if I may defer to the Financial Secretary?
FINANCIAL SECRETARY: Sir, this is a complex issue and I think it depends on the circumstances of any particular case. But essentially a private offering would be made to a very limited number of people and would not be available for them to pass on to others. The advice that has recently been given by the Securities and Futures
Commission, who have been drawing attention to the fact that it is an offence to issue an advertisement for a public offering without the particular advertisement having been cleared by them, is that if any person is in any doubt, he should take legal advice. I do not think that it is easy for a layman to identify which type of offer would break the law. So legal advice is recommended in all cases so that he can then determine whether permission is required or not.
Invitation to the Prime Minister to visit Hong Kong
2. MRS. CHOW asked: Will the Government extend an invitation to the Prime Minister to visit Hong Kong during her planned visit to Kuala Lumpur in October to attend the Commonwealth Parliamentary Heads Meetings, so that she can see at first hand the mood in Hong Kong, and demonstrate to Hong Kong her continuing commitment to this territory, bearing in mind her last visit to Hong Kong was almost five years ago for the signing of the Sino-British Joint Declaration?
CHIEF SECRETARY: Sir, the Prime Minister, as indeed any Minister of the Crown, is always welcome to visit Hong Kong and does not need a specific invitation to do so.
MRS. CHOW: Given that no specific invitation is necessary, is the Government suggesting, by the Chief Secretary's answer to my original question, that there is no way in which it can take the initiative to convey to the Prime Minister our sentiment that a visit by her at this time to Hong Kong is highly desirable, and therefore prompt her to include Hong Kong in her itinerary?
CHIEF SECRETARY: Sir, I think Mrs. CHOW is seeking to enlighten the Legislative Council on what our advice might be to Ministers at this time. I am sorry to sound like a line from "Yes, Minister", but it is a well-established tradition that the advice of officials to Ministers is not made public. However, Sir, the inference of Mrs. CHOW's question is that a visit would be welcome at this time and I will certainly undertake to convey that sentiment to the Prime Minister.
MRS. LAM: Sir, what is the procedure for inviting the Prime Minister to visit Hong
Kong?
CHIEF SECRETARY: Sir, as I made it clear in my original answer, there is no requirement to invite the Prime Minister to Hong Kong. If any Minister of the Crown wishes to come here, then he or she is always welcome to do so.
MRS. FAN: Sir, I am not asking the Chief Secretary to reveal the advice that he may or may not give to the Prime Minister, but may I ask whether the Chief Secretary would consider it useful for the Prime Minister to come to Hong Kong and see for herself, at first hand, the situation in Hong Kong?
CHIEF SECRETARY: I am having a sort of "Yes, Minister" afternoon, Sir. I must refer Mrs. FAN to Standing Order 18(1)(h). She seems to be asking me for an opinion, which I think is out of order.
MRS. CHOW: Sir, it appears that there is a general lack of appreciation of the sense of urgency about Hong Kong in the United Kingdom. Will the Government undertake to put to Her Majesty's Government in the most effective way that this can best be remedied by inviting the Prime Minister to visit Hong Kong to see for herself the current mood in the territory?
CHIEF SECRETARY: Sir, as I have said in answer to an earlier question from Mrs. CHOW, I will certainly undertake to convey the sentiments expressed in the course of asking these questions.
Conservation of energy
3. PROF. POON asked: Will Government inform this Council whether it has any plans to introduce a programme for the conservation of energy in Hong Kong, including liaising with property developers on energy saving measures for adoption in major buildings and installations and nurturing a more energy- conscious community through
education?
FINANCIAL SECRETARY: Sir, in establishing an energy conservation policy for Hong Kong, we must take into account two factors which are of particular relevance to our circumstances. First, Hong Kong is a very small user of energy by international standards, and secondly, we are totally dependent on imports of raw materials for energy generation.
In normal times when supplies are adequate we do not wish to be so restrictive that industries are adversely affected in any way. It is also not our wish to impose restrictions which may affect the lifestyle of our community.
However, we cannot afford to be complacent and we certainly see scope for conserving energy. The public sector has drawn lessons from the oil crises of 1973 and 1979 and has maintained a number of energy economy measures, such as the reduction of non-essential lighting and air-conditioning. The concept of energy conservation is included also in the curricula of both primary and secondary schools to nurture a more energy-conscious community.
In 1979, the Oil (Conservation and Control) Ordinance was enacted to empower Government to take swift action in regulating the supply and consumption of energy. From time to time we have imposed restrictions on the use of electric light for advertising displays and floodlighting. We have also in the past adopted daylight saving hours and even the suspension of night race meetings.
As far as energy conservation in buildings is concerned, a detailed energy utilization study was undertaken on major buildings and installations in the early 1980s. We have since published information on energy conservation in buildings and have made it available to those involved in property development and building management. Furthermore, we are considering the commissioning of a consultancy study to recommend how energy conservation in buildings could best be achieved through legislation.
Sir, we believe that the present energy policy relying largely on the operation of market forces has served Hong Kong well and we intend to continue the current practice.
PROF. POON: Sir, since energy conservation has a direct implication on environmental protection, will the Secretary inform this Council of the environmental effect of curtain walls of buildings?
FINANCIAL SECRETARY: Sir, I think this is rather a technical question relating to the environment that I will defer, if I may, to the Secretary for Lands and Works.
SECRETARY FOR LANDS AND WORKS: Sir, I understand that curtain wall buildings are energy-high in consumption and this is among the reasons why the study proposed and mentioned by the Financial Secretary is now being considered.
MR. PETER WONG: Sir, the Government's action so far has been entirely words. What concrete measures has the Government taken actually to do something about it to set a good example to the public in Hong Kong regarding energy conservation?
FINANCIAL SECRETARY: Sir, a detailed study as I have mentioned, was undertaken in the early 1980s on buildings and installations and practical effect has been given to that. I can give some examples. There were management consultants appointed and work was done at the Queen Elizabeth Hospital, the Kowloon Government Offices, and Kai Tak Airport. As a result, energy saving measures have been implemented on various buildings and installations. Kai Tak Airport is one of the most successful examples. The energy-saving measures included the replacement of 25% of the air-conditioning main chiller plant by more efficient equipment plus the installation of a centralized switching system for the terminal lighting and air-conditioning and auxilliary plant. This has saved some 12 million units of electricity in 1984 alone, which is the
equivalent of about $7 million. There are a number of other energy-saving successes -- Mirror Tower Building, a saving of $260,000 per annum, and if Mr. Peter WONG wishes, I can write to him giving more details. (Annex II)
PROF. POON: Sir, I understand that a government working party has quite recently completed a report on energy conservation. Will the Secretary inform this Council of the major recommendations of that report, and will these recommendations be
seriously considered?
FINANCIAL SECRETARY: Sir, I am afraid I do not have with me the results from that working party, but I will give a written reply to Professor POON. (Annex III)
MR. EDWARD HO: Sir, I am glad that the Financial Secretary said that the Government is conscious of energy saving. Would the Secretary inform this Council whether Government is prepared to review daylight saving hours once again this year?
FINANCIAL SECRETARY: Sir, I understand that that was reviewed fairly recently and there was a general view in the community which did not suggest that this would have popular support. But I will once again consider whether it is worth doing anything about it. But I think the review was fairly recent.
Written answers to questions
Kindergarten teachers
4. MRS. SO asked: According to a survey conducted by the Non-profit Making Kindergarten Council, kindergarten teachers are in general seriously underpaid with an average monthly salary of less than $3,000, which is much lower than the normative salary levels proposed in the Education Commission Report No. 2, and this has resulted in a high wastage of kindergarten teachers and a decline in the quality of new recruits. Will Government inform this Council whether urgent consideration will be given to reviewing the pre-primary education policy with a view to improving the pay and conditions of the teachers and the quality of education, for example, by means of direct subsidy?
SECRETARY FOR EDUCATION AND MANPOWER: Sir, we have been reviewing pre-primary education policy in the light of the Education Commission's recommendations in its Report No. 2. We intend to seek approval shortly for a package of measures designed to raise standards of staffing in kindergartens. These include --
(a) a large-scale programme of basic training to ensure that, within a five year period, all kindergarten teachers obtain at least the minimum qualification;
(b) publishing recommended salary scales;
(c) enabling operators to meet higher staff costs by allowing higher fees to be charged, and by raising the existing level of fee assistance to eligible needy parents; and
(d) ways and means of encouraging operators to employ a higher proportion of trained staff.
Civic education
5. MR. DAVID CHEUNG asked: Will the Administration inform this Council whether, to improve civic education and the ideas of democracy among young people, it will consider amending the Education Ordinance and Regulations to permit students to receive instruction and education which is of a political or partly political nature and to participate in processions or political activities?
SECRETARY FOR EDUCATION AND MANPOWER: Sir, nothing in the Education Ordinance or Regulations prevents students from receiving instruction and education aimed at promoting political awareness and knowledge. It is only where such instruction or education is considered by the Director of Education to be prejudicial to the public interest or to the welfare of the students or of education generally that it may be prohibited.
It is true that the Director of Education may require a student who has taken part in processions, propaganda or political activities to be expelled from school. This power, however, has never been invoked.
However, since there appears to be a misconception that the Education Regulations prohibit political activity of any kind in schools, there is a case for reviewing them to make it clear that political activities are in order, so long as the welfare and interests of students are safeguarded. This will be included in our current review of the Education Ordinance and Regulations, and I hope we could reach a view before too long.
Tai A Chau detention centre
6. MR. TIEN asked: With the emergency use of Tai A Chau as a detention centre for Vietnamese boat people, will Government inform this Council what measures are being taken:
(a) to prevent deterioration of the natural environment on the island; (b) to protect local inhabitants' livestock and fish resources;
(c) to ensure the safety of the comparatively few police officers stationed on the island, bearing in mind the large number of boat people and the potential for unrest; and
(d) to ensure effective policing of the island, so that those who commit offences are identified and properly dealt with according to law?
SECRETARY FOR SECURITY: Sir, basic facilities such as water tanks and generators have been installed on Tai A Chau which is continuing to be used as a temporary holding centre for Vietnamese boat people. The conditions on the island are far from satisfactory. The boat people are intended to be held in transit only and to be moved to alternative accommodation when available. Unfortunately the continuing arrivals of large numbers of Vietnamese make it unlikely that the use of the island can be relinquished in the near future.
The main environmental threat to the island arises from the large numbers of people currently detained there and the absence of waste collection, disposal facilities, proper sewage and drains. Police have tried to mobilize the boat people to collect the rubbish themselves for disposal by incineration. The Regional Services Department have carried out pest control measures wherever possible. There are plans to launch cleansing operations shortly to prevent further deterioration of the natural environment on the island, and to install additional latrines.
The police have warned the boat people to keep away from the mariculture rafts and police patrols have been mounted to prevent access. Unfortunately, other livestock, in the form of some semi-wild cattle who tend to wander all over the island,
cannot be offered complete protection.
The safety of the police officers stationed on the island will be ensured by established operational procedures. Contingency plans have also been drawn up for dealing with any potential disturbance.
Vietnamese boat people on Tai A Chau, unlike those held in other detention centres, are not confined within a fenced area. Complete policing, given the situation on the island and the police resources available, is therefore not possible. However, the main areas where the population is concentrated are regularly patrolled and prompt action is taken against any persons who breach the law.
Paid leave for workers
7. MR. TAM asked: Will Government consider amending the Employment Ordinance to increase the number of days of annual paid leave for workers, which was last revised in 1978, and to introduce marriage leave with pay?
SECRETARY FOR EDUCATION AND MANPOWER: Sir, I understand that the Labour Advisory Board was consulted recently on a proposal to increase the provision of paid annual leave for workers from seven days to up to 10 days, depending on length of service. The Board's advice will be carefully considered and I await the Commissioner for Labour's recommendations.
We have no plans to introduce marriage leave with pay in Hong Kong.
Jordan Valley landfill
8. MR. POON asked: In view of the fact that the Jordan Valley landfill has frequently caused serious air pollution and environmental nuisance, especially in the summer season, to the nearby residents of Shun Lee and Shun On Estates and the patients of the United Christian Hospital in Kwun Tong, and that only piecemeal improvements have been made upon receipt of complaints, will Government inform this Council what measures will be taken to tackle the above problems at source; whether assurance will be given to prevent the recurrence of such nuisance to the residents;
when the landfill will be closed down or cease operation; and what steps will be taken after the closure to ensure that there will be no emission of landfill gas which is hazardous to the health and safety of the residents in the area?
SECRETARY FOR LANDS AND WORKS: Sir, may I answer Mr. POON's third question first. We propose to close down Jordan Valley landfill in 1990 when the new refuse transfer station is opened at Kowloon Bay. I mention this first because the only way in which the problem of odours in the summer will finally be solved is by closure. This is the basis of the Solid Wastes Disposal Strategy which recognizes that refuse in hot climates always smells, however well-managed.
In the meantime, in this summer and next, Government has employed a reliable and experienced landfill contractor to manage the landfill. The methods used to compact, cover and seal the refuse are up to date and properly supervised by the Civil Engineering Services Department and also monitored by the Environmental Protection Department. The leachates flow into the foul drainage system. Moreover there are special arrangements for disposing of leachate from refuse wheeling vehicles and the washing of the vehicles and the roads around the landfill sites.
Following the closure of the landfill next year a final soil cover will be placed over the landfill. A gas control system will also be installed to ensure that there will be no hazardous emission of landfill gas. The Environmental Protection Department is now preparing the specifications of the final cover and the gas control system.
Sir, I do not believe that more can be done to make Jordan Valley landfill offend less. The only real answer is removal and to ensure that the highest standards of management are maintained. Meanwhile I am confident that this is being done.
School managers
9. MR. DAVID CHEUNG asked: With reference to the reply to a question asked in this Council on 21 June 1989, will the Government advise what criteria the Director of Education adopts in order to satisfy himself that the managers proposed for a school
are suitable for managing and administering the school, and whether these criteria include a reference to the minimum academic qualification of a proposed manager, having regard to the overall rising standard of education in Hong Kong and the variety of the nature of the sponsoring bodies of schools?
SECRETARY FOR EDUCATION AND MANPOWER: Sir, the Education Ordinance does not specify any minimum academic qualification for registration as a manager of a school. In considering an application, the Director of Education takes into account various factors, including the applicant's educational background, experience in or
knowledge of education, character and age. The director may refuse the application if the applicant is not considered fit and proper, or if other stipulations in section 25 of the Ordinance are not met.
If it appears to the director at any time that a manager cannot perform satisfactorily the duties involved, the approval to be a manager may be withdrawn.
Since many members of the community now in their middle age have had limited opportunities for education, it would not be appropriate at this stage to stipulate any minimum academic requirement.
Motions
LANDLORD AND TENANT (CONSOLIDATION) ORDINANCE
THE SECRETARY FOR LANDS AND WORKS moved the following motion: "That --
(a) the Landlord and Tenant (Consolidation) Ordinance be amended -- (i) in section 10(1) by repealing "39" and substituting "43";
(ii) in section 58(2) by repealing "60" in both places where it occurs and substituting "65"; and
(iii) in section 74B(1) by repealing "1989" and substituting "1991";
(b) the amendment set out in paragraph (a)(i) above shall come into operation on 1 November 1989; and
(c) the amendment set out in paragraph (a)(ii) above shall bot apply to applications for a certificate under section 57 of the Landlord and Tenant (Consolidation) Ordinance made before 19 December 1989."
He said: Sir, I move the resolution standing in my name on the Order Paper.
Government's long-term objective which should be made to accelerate the phasing out of rent control, provided that social disruption and economic hardship can be avoided. Consequently, amending legislation has been passed by this Council each year since 1981 for pre-war premises, and every year since 1983 for post-war ones, in order to raise the controlled rents progressively, bringing them closer to
prevailing market levels and eventual decontrol.
The first proposal in the resolution seeks to raise the permitted rent of pre-war premises covered by Part I of the Ordinance, to a more realistic level. Rents of pre-war premises are derived from a standard rent as at 25 December 1941. The current permitted rent is set at 39 times this level, and it is now proposed to increase this to 43 times the standard rent.
This change would bring the average permitted rent of pre-war premises up from 71% to 79% of the prevailing market level. It would result in an average increase of about 10%, or $150 per month, on current permitted rents and would affect about 1 350 domestic premises.
The second proposal in the resolution is to raise the so-called "minimum percentage component" in the rent increase mechanism that applies to post-war domestic premises protected under Part II of the Ordinance.
Rent increases permitted in respect of tenancies protected under Part II of the Ordinance, are limited to the difference between the current rent and the prevailing market rent, but subject to a ceiling of 30% of the current rent. However, if the new rent calculated according to this formula is less than a specified percentage (which is at present 60%) of the prevailing market rent the permitted rent increase would be the amount which will bring the new rent up to this minimum percentage. The
reason for specifying this minimum percentage, which is known as the minimum percentage component is firstly to ensure that controlled rents do not fall too far out of line with the prevailing market rent and secondly to enable rent controls to be phased out within the shortest possible time without adverse social consequences.
The average controlled rents for Part II tenancies now stand at about 65% of the prevailing market rent. However, for about 55% of these tenancies, the controlled rent is below this overall average, and about 18% of them are less than 50% of the prevailing market rents. So to ensure that controlled rents do not fall behind this overall average, the Government proposes to increase the minimum percentage component from 60% to 65% of prevailing market rents. Assuming that market rents remain
relatively stable, this will have a net effect of increasing by 883 the number of tenancies affected by the minimum percentage component and increasing the average controlled rent by $18 per month. On this basis, the rent increase mechanism would bring controlled rents to the decontrol level in 1992.
The third proposal in the resolution seeks to further extend the life of Part II of the Ordinance, from 19 December 1989 to 18 December 1991.
Part II of the Ordinance provides protection of rent control and security of tenure to about 60 000 post-war domestic tenancies, plus an undetermined number of sub-tenancies. As explained earlier, Part II is allowed to expire after 18 December 1989, the tenants concerned will face, on average, an immediate rent increase of more than 35% and in some cases, of more than 100%.
These rent controls will be reviewed again next year, taking account of the state of the property market and the social and economic consequences. Any further steps towards decontrol will be carefully considered in the light of the situation at that time.
Sir, I beg to move.
At this point, the following Members declare their interests: Mrs. Selina CHOW as a director of a company which is a landlord. Miss Maria TAM as a landlord.
Mrs. Rita FAN as a landlord.
Mr. Peter POON as a landlord and a director and a shareholder of a company which is a landlord.
Mr. CHENG Hon-kwan as a director of a company which is a landlord. Mr. CHUNG Pui-lam as a landlord.
Mr. HO Sai-chu as a landlord, a tenant and a director of a comapny which is a landlord. Mr. NGAI Shiu-kit as a landlord and a director of a company which is a landlord. Mr. TAI Chin-wah as a landlord and a tenant.
Mr. LAU Wong-fat as a director of a company which is a landlord. Mr. Ronald ARCULLI as a director of a company which is a landlord. Mr. Paul CHENG as a director of a company which is a landlord. Mr. David CHEUNG as a tenant.
Mr. Daniel LAM as a landlord and a director of a company which is a landlord. Mr. Jimmy McGREGOR as a landlord and a director of a company which is a landlord. Mrs. SO CHAU Yim-ping as a director of a comapny which is a landlord. Mr. James TIEN as a director of a company which is a landlord. Question on the motion proposed, put and agreed to.
PEAK TRAMWAY ORDINANCE
THE SECRETARY FOR TRANSPORT moved the following motion:
"That this Council approves the Peak Tramway By-laws made by the Peak Tramways Company Limited on 1 July 1989."
He said: Sir, I move the motion standing in my name on the Order Paper. The motion seeks this Council's approval of the Peak Tramway By-laws.
Section 15A of the Peak Tramway Ordinance empowers the Peak Tramways Company Limited to make by-laws and provides that they shall be subject to the approval of this Council.
With the modernized peak tramway commencing operation in early August this year, the company requires a new set of by-laws to regulate the conduct of persons travelling on or in the vicinity of tramway premises such as stops. The by-laws also set out the arrangements for the issue of passenger tickets, the payment of fares and the handling of lost property. They also prohibit the carriage of firearms and dangerous substances in tramway premises.
The enforcement procedures and the penalties for the contravention of the by-laws are also prescribed, the maximum penalty being a fine of $5,000 and imprisonment for six months.
The existing Peak Tramway By-laws, which were made in 1923, will be repealed. Sir, I beg to move.
Question on the motion proposed, put and agreed to.
First Reading of Bills
SECURITIES (INSIDER DEALING) BILL 1989
SUMMARY OFFENCES (AMENDMENT) (NO. 2) BILL 1989
Bills read the First time and ordered to be set down for Second Reading pursuant to Standing Order 41(3).
Second Reading of Bills
SECURITIES (INSIDER DEALING) BILL 1989
THE FINANCIAL SECRETARY moved the Second Reading of: "A Bill to amend the law relating to insider dealing in securities; and for connected purposes."
He said: Sir, I move that the Securities (Insider Dealing) Bill 1989 be read the Second time.
The main purpose of this Bill is to provide a more comprehensive definition of insider dealing and to increase the sanctions that may be imposed by the Insider Dealing Tribunal in order to provide a more effective deterrent against insider dealing. The Bill incorporates many of the existing provisions in Part XIIA of the Securities Ordinance, particularly those in relation to the constitution of the tribunal, the scope of its inquiry and its powers of investigation. The Bill also introduces a number of important changes which are designed to improve and strengthen the present tribunal system. I shall highlight some of the more significant proposals.
First, the Bill increases substantially the sanctions which may be imposed by the Insider Dealing Tribunal. At present, the only sanction available is public censure. This is inadequate and more effective deterrents are required. To this end, the Bill empowers the tribunal to impose severe penalties upon persons found to have been involved in insider dealing. The tribunal may disqualify such persons from the directorship or the management of any company, public or private, for up to five years. The tribunal may also require the disgorgement of any profit made or loss avoided and impose a fine of up to three times the relevant amount.
We believe that tougher sanctions coupled with the flexibility of the tribunal system is the right approach in tackling the problem of insider dealing in Hong Kong. However, as I have said previously, we have not ruled out the option of criminalization entirely. We shall review the matter in three years' time in the light of experience of increased tribunal sanctions under this Bill.
Secondly, the Bill provides a more comprehensive definition of insider dealing. It now catches as an insider a person who is contemplating or has contemplated a
takeover bid as well as any person informed by an insider, commonly known as a "tippee". It also catches dealing in the securities of a related corporation and the promotion of insider dealing on an overseas stock exchange. Moreover, it adds an important new requirement that an insider or tippee must know that he is in possession of inside information.
Thirdly, the Bill grants a limited right of appeal. Persons found to have been involved in insider dealing may appeal on a point of law to the Court of Appeal. We have not proposed a general right of appeal because we believe the tribunal is best placed to decide on the facts of the case. This right will be without prejudice to the existing right of judicial review.
Fourthly, the Bill requires that sittings of the tribunal be held in public unless the tribunal considers that in the interests of justice, a sitting or any part thereof should be held in private. At present, the tribunal's proceedings are in private. We believe that it is in the wider public interest for proceedings to be held in public, as in the case of criminal and civil proceedings before a court of law.
Fifthly, the Bill empowers the tribunal to order a person found to have been involved in insider dealing to pay to Government such sums as it sees fit towards the expenses of the inquiry and any related investigation carried out by the tribunal. We consider it reasonable to require insider dealers to contribute towards the
tribunal's expenses.
Let me now turn to the question of insider dealing in futures contracts. During the Second Reading debate on the Securities and Futures Commission Bill in April this year, Sir Piers JACOBS undertook to consider whether the Securities and Futures Commission's powers of investigation should be extended to cover insider dealing in futures contracts and to report back to this Council.
We have considered whether the Bill before this Council should also bring futures contracts within the scope of insider dealing. This question raises a number of technical issues which require very careful examination. First of all, the definition of "relevant information" for the purpose of insider dealing requires some attention. Should this relate to unpublished price-sensitive information about a corporation, an industrial sector, the political situation or the economy as a whole? Secondly, we have the problem of proof. What evidence is required to show a sufficient causal relationship between particular information and a material change
or likely material change in the price of a futures contract? Thirdly, we have the question of scope. Should it embrace all financial futures or just stock index futures contracts?
These are not easy questions to answer. An indication of the difficulty involved is that futures contracts are not caught by the equivalent United States legislation and only caught in a very limited way, if at all, by the United Kingdom legislation as the relevant provisions have yet to be tested before the courts.
Having regard to the complexities involved and the need to introduce tougher penalties as quickly as possible, we have concluded that the question of futures contracts should not be addressed in the present Bill. However, I can assure Members that we will carefully examine the question with the Securities and Futures Commission in the light of our experience of the proposed new legislation in operation and will prepare legislative proposals if and when these are considered appropriate.
Sir, I move that the debate on this motion be now adjourned.
Question on the adjournment proposed, put and agreed to.
SUMMARY OFFENCES (AMENDMENT) (NO.2) BILL 1989
THE SECRETARY FOR SECURITY moved the Second Reading of: "A Bill to amend the Summary Offences Ordinance."
He said: Sir, I move the Second Reading of the Summary Offences (Amendment) (No. 2) Bill 1989.
This Bill seeks to reduce noise nuisance caused by audible burglar alarms.
Members of the public, particularly people living in areas where there are a large number of shops and businesses, frequently complain of the noise caused by burglar alarms. Such alarms often ring for very long periods, while the police try to contact the occupiers of the premises concerned to ask them to turn off the alarms.
To reduce this noise nuisance, the Bill proposes that any person in control of an alarm system must fit a device to the system to cut off the audible alarm within
15 minutes of it first ringing. The Bill further proposes that the maximum penalty for not fitting such a device should be a fine of $5,000 and three months' imprisonment.
There are an estimated 50 000 audible alarms in Hong Kong. It is therefore proposed that, following enactment, there should be a grace period of one year before the Bill's provisions come into effect. The fitting of a cut-off device to an audible alarm is a simple and inexpensive operation.
Sir, I move that the debate on this motion be adjourned.
Question on the adjournment proposed, put and agreed to.
ARBITRATION (AMENDMENT) BILL 1989
Resumption of debate on Second Reading which was moved on 28 June 1989
Question on the Second Reading of the Bill proposed, put and agreed to. Bill read the Second time.
Bill committed to a Committee of the whole Council pursuant to Standing Order 43(1).
COUNTRY PARKS (AMENDMENT) BILL 1989
Resumption of debate on Second Reading which was moved on 28 June 1989 Question on the Second Reading of the Bill proposed, put and agreed to. Bill read the Second time.
Bill committed to a Committee of the whole Council pursuant to Standing Order 43(1).
SUMMARY OFFENCES (AMENDMENT) BILL 1989
Resumption of debate on Second Reading which was moved on 24 May 1989
Question on the Second Reading of the Bill proposed, put and agreed to. Bill read the Second time.
Bill committed to a Committee of the whole Council pursuant to Standing Order 43(1).
TEMPORARY CONTROL OF DENSITY OF BUILDING DEVELOPMENT (KOWLOON) BILL 1989 Resumption of debate on Second Reading which was moved on 31 May 1989 Question on Second Reading proposed.
MR. CHENG HON-KWAN: Sir, in view of the potential controversy over this new piece of legislation, an ad hoc group was set up to scrutinize the Temporary Control of Density of Building Development (Kowloon) Bill 1989.
Under the Hong Kong Airport (Control of Obstructions) Ordinance, airport height restrictions (AHR) are imposed on buildings to ensure aircraft safety. With the introduction of new obstacle clearance criteria by the International Civil Aviation Organization in 1982, the Civil Aviation Department has initiated a review of AHR in 1983. Phase I of the review was implemented in 1986. The Phase II review has now been completed.
Implementation of the recommendations of the Phase II review will result in the relaxation of existing AHR in many areas of Kowloon which could lead to a significant increase in existing plot ratio. It will also involve the imposition of AHR for the first time in parts of Hong Kong Island and Lantau Island and the tightening up of existing AHR in some areas of Kowloon. The development of those areas with relaxed AHR to their maximum permitted density under the new AHR will put severe strain on existing and planned infrastructure and community facilities. On the other hand, it will be unlikely that land is available for the construction of new roads and other facilities to cater for the additional development density that the relaxed AHR will permit.
The Bill seeks to impose temporary control on the density of building development by ensuring that after the implementation of the new AHR recommended by the Phase
II review, new buildings are not developed to a plot ratio greater than that that can be achieved under the present AHR. The present intention is that the Bill will expire on 31 December 1990, unless extended by a resolution of the Legislative Council.
Hong Kong is one of the most populous and crowded cities in the world. The problem of overcrowding and inadequate facilities is most serious in the old urban areas. Much needs to be done in the field of town planning to thin out population density in the older built-up areas to enable better provision of infrastructure and community facilities, and thereby improved quality of life. The formulation of a comprehensive planning strategy for the metropolitan area is currently undertaken by the Metroplan study.
Against such background, the Government is highly concerned that the substantial increase in plot ratio arising from the relaxed AHR would give developers a significant incentive to develop or redevelop to the maximum permitted density, thus causing unacceptable strain on the already overloaded infrastructure in Kowloon and New Kowloon. Although it is still difficult to assess the impact of the recent events in China on the property market, Members share the Administration's view that a freeze on the existing development density is necessary until a comprehensive planning strategy for the metropolitan area is formulated by the Metroplan.
Since the main purpose of the Bill is to impose some form of interim development control until the conclusions and implementational details of the Metroplan study are known by the end of 1990, Members have questioned whether the implementation of the new AHR can be deferred until such date. According to the Administration, it will be unacceptable to defer the imposition of new height restrictions on parts of Hong Kong and Lantau Island. Besides, according to legal advice, the Governor in
Council's power to impose AHR should be circumscribed to civil aviation safety ground and should not be exercised for town planning control. Thus, it is reckoned that a new manner of statutory control over building density in areas where the AHR are to be relaxed needs to be instituted, no matter how temporary its nature.
Members have questioned the possible effects of the relaxed AHR on the flight path of the replacement airport. The Administration has assured Members that although the review of AHR is done as a separate exercise from the Port and Airport Development Study, judging from the locations of the shortlisted replacement airports, the relaxation of AHR resulting from the review will not cause obstacle problems
to the new airport.
The group has also identified several technical points in relation to the drafting of the Bill on which the Administration has agreed that amendments should be made. I shall be elaborating on the reasons behind these amendments during the Committee stage.
Sir, with these remarks, I support the Bill.
MISS LEUNG (in Cantonese): Sir, height restrictions on building development in some districts of the territory are determined with reference to the Hong Kong Airport (Control of Obstructions) Ordinance which seeks to ensure the safe landing and take-off of aircraft. The Ordinance is principally based on the International Civil Aviation Organization's guidelines on safe landing and take-off. However, revisions to the guidelines in 1982 have introduced new standards as to the safe distance between the flight path and an obstruction. Hong Kong is obliged therefore to re-determine the height restrictions according to the new standards.
In 1983 the Civil Aviation Department started a two-phase review of obstructions control. The first phase was completed quite some time ago and the recommendations emanating from it have been implemented since November 1986. The second phase has lately been completed. Part of the recommendations of the latter-phase review
propose generous relaxation of height restrictions on building development in some of the districts concerned, that is, in most parts of Kowloon and New Kowloon.
Sir, generous relaxation of building height restrictions in most parts of Kowloon and New Kowloon will mean that the density of building development in these already densely built up areas will be further and considerably increased. Old developed areas have all along been suffering from over-dense building development, lack of certain community facilities, and inadequate communal space and roads. If density of building development in these areas is to be substantially heightened, developers will find it worthwhile to apply for redevelopment of individual sites or undertake new development projects based on the higher density criterion to beat the Metroplan which is expected to be put into effect by the end of next year. In the districts concerned, many land lots not subject to express provisions as to height and plot ratio under the Crown lease will be hotly sought after for redevelopment purpose. This will lead inevitably to a surge in demand on the already stretched community
and infrastructural facilities in these old developed areas.
Sir, height control of obstructions in or under the flight path is meant to ensure flight safety. In the context of flight safety, however, height control of obstructions in some districts has nowadays been proved to be outmoded and need to be revised. However, the Administration is worried lest a revision in that regard should heighten or otherwise affect the density of building development in most districts of Kowloon and New Kowloon, not to mention the indirect impact it would have on the Metroplan expected to be implemented from 1 January 1991. It is with this in mind that the Administration has put forward this Temporary Control of Density of Building Development (Kowloon) Bill 1989 to seek to impose temporary control on the density of building development in the affected districts and to ensure that the plot ratio of new buildings will not exceed the level allowed under the present regime of height control of obstructions in or under the flight path.
It should be patent to all that the Bill, in its over-concern to dovetail with the regime of height control, has imposed on itself unnecessary limitations. As a result, the Bill, while seeking to restrict the plot ratio of new buildings in the affected districts, still leaves room for new buildings to exceed the height allowed under the present control of obstructions in or under the flight path.
This arrangement will obviously create loopholes. Once height control of buildings is relaxed, the gross area of new developments on some land lots in affected districts will, notwithstanding restrictions on plot ratios, vastly increase over that of existing developments. This will lead to heightened density of building development in the districts concerned. In certain cases, even if the gross area of new developments on some land lots is to remain as before, "tall thin" buildings,
deliberately designed to optimize utilization of height, will be erected, compromising the environment and the future Metroplan.
Sir, I believe the loopholes could be plugged if we could overcome the Bill's obsessive concern to dovetail with the regime of height control of obstructions in or under the flight path and reconsider revising the Bill based on practical town planning or Metroplan principles. As most of the affected districts in Kowloon and New Kowloon are old developed areas with inadequate basic community facilities and high built-up density, we therefore cannot allow any denser building development. Based on the above observations, there should be adequate town planning and
metroplanning reasons to restrict the height of new buildings in the affected
districts to a level consistent with the present regime of height control of obstructions in or under the flight path, and hence to control the density of building development. I believe that this suggestion is substantially better than the present Bill's proposal to impose plot ratio restrictions on new buildings but relax height restrictions.
Sir there is no doubt that we are in urgent need of an overall planning strategy or guideline for redevelopment programmes to follow. Only with such a guideline in place can redevelopment programmes effectively and meaningfully proceed. The Metroplan now under study should be able to provide an overall policy framework within which redevelopment in old urban areas will proceed. As the Metroplan is expected to be in place by early 1991 I believe the Administration should now refrain from encouraging small-scale or unco-ordinated redevelopment projects to go ahead. I should like also to take this opportunity to urge the authorities concerned to expedite and to ensure the completion of the Metroplan on or even ahead of schedule, so that there will be a firm basis on which development of our metropolitan areas can proceed.
Sir, in view of what I perceive to be patent loopholes in the present Bill I will not support the motion but neither will I oppose it because the Bill aims at controlling the density of building development.
Sir, with these remarks, I beg to abstain.
SECRETARY FOR LANDS AND WORKS: Sir, I would like to take this opportunity to thank the OMELCO ad hoc group for considering this Bill in detail and their suggestions for improvement. The minor amendments to the Bill which will be moved by the Honourable CHENG Hon-kwan at the Committee stage have the full support of the Administration. I was not aware, prior to a minute ago, that Miss LEUNG in fact would not support this Bill. But I would like to assure her that the purpose of this Bill is a temporary measure; it is in order to provide that development in future shall be in accordance with an appropriate planning strategy and that, in the view of the Administration, it is most unlikely to give rise to buildings of a greater density than could have been achieved under the existing or rather previous airport height restrictions, or to a lot of tall, thin buildings.
Question on the Second Reading of the Bill put and agreed to.
Bill read the Second time.
Bill committed to a Committee of the whole Council pursuant to Standing Order 43(1).
DRUG TRAFFICKING (RECOVERY OF PROCEEDS) BILL 1989
Resumption of debate on Second Reading which was moved on 8 March 1989 Question on Second Reading proposed.
MISS TAM: Sir, the Drug Trafficking (Recovery of Proceeds) Bill 1989 was read for the First time in this Council on 8 March 1989. The objective of the Bill is to curb drug money laundering by introducing new investigative powers to facilitate the identification of proceeds derived from drug trafficking, and by creating a new offence of assisting in the retention and concealment of such proceeds. The non-government Members of this Council welcome the new initatives aimed at attacking the assets of drug traffickers and preventing profits derived from drug trafficking to be siphoned to other legitimate lines of business. However, in view of the extensive powers provided under the Bill which enables the courts to freeze and confiscate proceeds derived from drug trafficking, sometimes from persons other than the defendant, an ad hoc group was set up by this Council to examine its provisions. The Honourable Ronald ARCULLI, the Deputy Convener, and the Honourable Mrs. Miriam LAU chaired a Chinese text sub-committee to work alongside with the group to study the Chinese version of this Bill.
The ad hoc group met a total of 15 times, including five times with the Administration, once with the banking sector and nine internal discussions before we made the recommendations to the Legislative Council in-house meeting. The Chinese text sub-committee, with assistance from the OMELCO Legal Unit, met 13 times with Law Draftsmen from the Legal Department before completing its task. I would like to register a note of thanks to all of them for the quality of their work. The group and the Administration has now agreed on a package of 21 amendments to the English version and 50 amendments to the Chinese version of the Bill and I will briefly go through some of these amendments which concern major principles, whilst my colleague, the Honourable Peter WONG, will elaborate on other points which are more of a technical
nature.
This package of amendments represents a compromise reached between many different and sometimes conflicting considerations. We began our task by inviting views from professional bodies involved in an earlier draft of the Bill. These include the Hong Kong Association of Banks, the Hong Kong Association of Deposit Taking Companies, the Hong Kong Bar Association, the Law Society of Hong Kong, and the Hong Kong Society of Accountants. We received lengthy and detailed written submissions from all these professional bodies, and met representatives of the banking sector to exchange views on specific provisions in the Bill and the contents of their guidelines. The
Honourable David LI will no doubt explain the position of the bankers. Our main concern is that those offering professional service to their clients in good faith should not be unfairly prejudiced by any draconian measures of the law whilst on the other hand the law must be made effective.
The first issue to which I wish to address concerns clause 3(1) of the Bill which allows the confiscation investigations to proceed after the defendant has appeared before the High Court or the District Court. Upon closer examination the ad hoc group identified a potential loophole in that since the word "appear" will be construed as physical appearance, a drug trafficker could frustrate the confiscation
investigations by absconding before he is due for appearance in the court. To remove this potential loophole, the reference to appearance will be replaced by a reference to proceedings in the High Court or the District Court.
The second issue concerns clause 3(4) of the Bill which provides that, before sentence can be imposed upon a convicted person, the court will have to determine whether he has benefited from drug trafficking and, if so, to assess the amount involved and make consequent confiscation orders. The ad hoc group shares the legal profession's concern that determination of the appropriate sentence would be unduly delayed in complex cases where lengthy investigations are necessary to ascertain the assets involved, and that the court could be influenced, or at least perceived to have been influenced, by the extent to which the defendant is determined to have benefited from drug trafficking before passing sentence on him. In this respect, it is useful to point out that for a criminal conviction, the prosecution must prove beyond reasonable doubt that an offence has been committed by the defendant whereas for a confiscation order, the court only needs to be satisfied on the balance of probabilities, that the defendant has benefited from drug trafficking.
Apart from the arguments cited by the legal profession, the ad hoc group also understand that the identification and confiscation of assets derived from drug trafficking is totally independant from the determination and imposition of sentence for the convicted drug trafficking offence which triggered off the whole process of investigation, and recognizes the common law principle that power to delay sentence should only be exercised in limited circumstances. A proposal was therefore put forward to the Administration to remove the requirement that sentencing should be held up pending the completion of confiscation investigations. An amendment will be moved at Committee stage in this connection.
The third issue, raised by the banking sector, is of a very different nature. It relates to clause 25(1) of the Bill, which creates an offence for a person who enters into or is otherwise concerned in an agreement to retain or control on behalf of another person proceeds of drug trafficking if he entered into the agreement
"knowing or suspecting" that the latter person was a drug trafficker or had benefited from drug trafficking.
The banking sector is concerned that given the large volume of cash transactions in Hong Kong, tellers would be exposed to undue risks of contravening the law since they might not have the expertise to determine, under prevailing circumstances, what constitutes a suspicious transaction. It is also argued that suspicion, being a state of mind, should not lead to criminal liability. A proposal was therefore made that the requirement for banks to report such transactions be replaced by a cash limit, above which all transaction should be reported, or to replace the word "suspect" by "believe". This proposal is aimed at removing the uncertainty by stating clearly the potential liability of the banks.
The ad hoc group has discussed this point thoroughly and agreed that although the cash limit approach would lead to abuse; nevertheless, an alternative formulation of "having reasonable grounds to believe" should produce an acceptable balance between the need to minimize the burden placed upon innocent parties on the one hand, and the need to encourage people to report suspicious transactions on the other. Here the Legislative Council in-house meeting has given us the full support and at the end our suggestion was accepted by the Administration and a Committee stage amendment will be moved to effect this agreement.
The final issue which I would like to mention concerns the definition of "broadcast" under clause 26(9). The ad hoc group is of the view that the existing
definition which covers the specific means of radio, film, video tape or television may not provide adequate protection against the revelation of the identity of a person who has made disclosure of a suspicion or belief that any funds or investments are derived or used in connection with drug trafficking. The definition also appears too rigid and may not be able to keep pace with advances in the field of communication technology. Accordingly an amendment will be moved at Committee stage to widen the definition so that it covers not only those means specifically mentioned, but also other similar means of broadcasting. This should be able to give better protection to the informant and subject the definition to a more flexible interpretation.
Sir, my colleagues believe that the introduction of this Bill is not only aimed at discharging our obligations towards international efforts in investigating drug trafficking. We simply do not believe that drug traffickers should be allowed to enjoy their ill-gotten gains and we are now taking effective measures so that their wealth could be investigated and confiscated if the court sees fit. We call upon the private sector including the banking and professional sector to support this effort in our fight against drug trafficking.
With these remarks, Sir, I support the motion.
MR. LI: Sir, when enacted, the Drug Trafficking (Recovery of Proceeds) Bill 1989 will be a powerful weapon in Hong Kong's fight against crime and, in particular, against the drug trade. Hong Kong must use every legitimate method at its disposal to stamp out this evil trade.
The financial sector recognizes that it has a crucial role to play in the war against drug trafficking, and it welcomes the principle behind the Bill we are now debating. Financial institutions in Hong Kong are already doing their utmost to assist law enforcement agencies in this fight, and are prepared to co-operate fully with the authorities.
The banks of Hong Kong, through the Hong Kong Association of Banks, have made submissions and representations on this Bill to the Legislative Council and the Government. The present version of the Bill is a significant improvement on the original draft. For such an important subject, it is vital to draft legislation that will be effective -- and effective legislation is legislation which adequately reflects the specific operational conditions of Hong Kong.
As far as the financial industry is concerned, the most significant change in the Bill has been in section 25. In determining whether a transaction should be reported, the wording "having reasonable cause to believe" was substituted for a mere "suspicion".
While it would be better if the standard of judgment in section 25 were tightened further by using a more definitive word "belief", the new phrasing does provide a measure of protection to banks and their employees. It should, therefore, help to put implementation of this legislation on a firmer footing.
However, the financial industry still has a number of objections to the Bill, which the Government, most regrettably, has adamantly refused to alter. The three areas are of particular importance.
First, the Bill as now drafted contains no specific defences for bank employees, compliance officers and banks which operate in good faith. While the first of these groups, bank employees, can draw some comfort from the proposed letter to be given by the Secretary for Security, the truth is that such a letter would not be binding on the Attorney General or the Crown Prosecutor.
The argument against providing specific defences seems to turn largely on the difficulty of drafting language that gives protection without opening more loopholes. However, as in the case of the word "suspicion", the lack of protection for the financial industry could well undermine the effectiveness of this legislation. Specific defences should be made available in each of the cases just cited.
A second point of concern is the issue of criminal liability in Hong Kong. The current draft of the legislation fails to clarify what the territorial limitations of the Bill will be and whether or not persons in Hong Kong will be held liable for participating indirectly in or simply having knowledge of illegal activities outside the territory.
Under the legislation as now drafted, it is arguable that banks which receive reports from or make credit decisions for branches outside Hong Kong may inadvertently incur liability even though the illegal act took place abroad. The Government disagrees and takes the view that criminal liability can only be incurred in respect of transactions within the territory. If that is the Government's position, why will
they not agree to a simple amendment stating that position?
Third, there is the question of guidelines. It would give the financial industry a far greater degree of comfort if the guidelines for the implementation of this Bill were referred to specifically in the legislation. I understand that the Government will give assurances regarding how it will operate the legislation now, with
particular regard to the guidelines. But these assurances are of an informal nature. As such, they may not be binding in the future.
The financial industry would prefer to see the guidelines referred to in the legislation and specific defences tied to observance of the provisions of the guidelines.
The Government has indicated that it is prepared to review the Bill at some point in the future. Hong Kong's financial industry strongly believes that a date should be fixed now for this review.
The review should occur within two years after the legislation comes into force. It should involve a thorough, independent evaluation of the operation of the law, and should recommend any amendments needed to eliminate ambiguity and improve the efficiency of enforcement.
Sir, I wholeheartedly endorse the general motive of this Bill, but I would again express my disappointment that the Administration is not prepared to take full account of the objections of the financial industry.
Sir, with these remarks, I support the motion.
MRS. LAU (in Cantonese): Sir, the Drug Trafficking (Recovery of Proceeds) Bill 1989 is the first piece of legislation concerning criminal liability since the introduction of bilingual legislation in Hong Kong. To the general public, criminal law is of particular significance because it has a direct bearing on personal freedom and rights.
The Drug Trafficking (Recovery of Proceeds) Ordinance is a draconian criminal statute introduced with the aim of deterring people from engaging, participating or assisting in drug trafficking activities by confiscating the property derived from
drug trafficking in addition to the appropriate penalties imposed on the offenders. The provisions of the Bill confer extensive powers on the court which may issue restraint orders, charging orders and confiscation orders and so on. The court may also give authorization for the seizure and detention of any material conducive to the investigation of drug trafficking activities. A number of assumptions have also been provided in the Bill against drug traffickers, so that they can hardly escape from punishment and those who have assisted others to retain the benefit of drug trafficking and knowingly concealed the facts are also liable to criminal prosecution.
The Legislative Council ad hoc group is in full support of the spirit of this piece of legislation which on the one hand enables Hong Kong to take an active role in fulfilling its obligation to the international effort in eradicating drug trafficking activities, and on the other hand, fully expresses our determination to combat the notorious drug traffickers with draconian legislation and severe penalties. In the fight against crimes, we have to maintain the fairness of the law and avoid causing any unnecessary hardship to the innocent parties. In this respect, the ad hoc group has, after careful deliberation, made a number of recommendations to ensure that the Bill is in line with the spirit and principle of common law.
In scrutinizing this Bill, the major task of the Chinese Text Sub-committee under the ad hoc group is to avoid the existence of any discrepancies between the legal meaning of the Chinese and the English texts because both texts will become authentic versions and enjoy equal legal status. Any contradiction or ambiguity will cause unnecessary difficulties to the enforcement staff and be unfair to the accused
although, in principle, the court may decide on the true meaning of the legislation in accordance with the Interpretation and General Clauses Ordinance. The Chinese Text Sub-committee was fully aware of the importance of this and carefully studied the Chinese text of the Bill so as to ensure that the diction adopted will accurately reflect the full meaning of the English text.
Most of the existing criminal statutes of Hong Kong are based on or even borrowed from the criminal statutes of the United Kingdom for two reasons:
First, the United Kingdom criminal statutes which have been in force for many years are well-defined in legal principles, compact in their formulation and functioning well. Since both Hong Kong and the United Kingdom are following the same legal principles, there is no reason why Hong Kong should not borrow from the United
Kingdom in drafting its own laws.
Second, the court has to make reference to case law when trying cases. Although the courts of Hong Kong are not bound by the judicial precedents in the United Kingdom, they can refer to such precedents if the legislation concerned is similar in terms of language, content and legal principles to the United Kingdom legislation and it will be much easier for the parties concerned to invoke the relevant legislation and rely on the precedents.
The English text of the Drug Trafficking (Recovery of Proceeds) Bill was drafted by making reference to the Drug Trafficking Offence Act 1986 of the United Kingdom. A number of provisions in the Bill borrowed word for word from the United Kingdom legislation. Apparently, a characteristic of the United Kingdom statutes is that most of them have been drafted in the archaic style and the legal principles are expressed in a circumlocutory or convoluted manner. As a result, the provisions of United Kingdom legislation appear to be very complicated.
Such drafting style is understandable. The intention of the law draftsmen is to ensure that the legislation so drafted can accurately express the spirit of the legislation and avoid loopholes as far as possible. This principle is particularly important in drafting criminal statutes. In a statute such as this one which involves complicated legal principles, the provisions will inevitably be complex and
cumbersome.
Some provisions of the Drug Trafficking (Recovery of Proceeds) Bill 1989 are drafted in a circumlocutory and convoluted manner, for example:
(a) clause 2(9): "References to an interest held by a person beneficially in property include, where the property is vested in his trustee in bankruptcy or in a liquidator, a reference to an interest which would be held by him beneficially if the property were not so vested."
(b) The English text of clause 4(2): "the High Court or the District Court as the case may be, may for the purpose of determining whether the defendant has benefited from drug trafficking and, if he has, of assessing the value of his proceeds of drug trafficking, make the following assumptions, except to the extent that the defendant shows that any of the assumptions are incorrect in his case."
The above provisions indicate that it is really a hard job to translate the complicated English sentences into Chinese while preserving their legal meaning at the same time. Moreover, as most clauses are sub-divided into a number of sub-clauses which are then further split into paragraphs, it would be a highly formidable task to follow the common grammatical rules in the Chinese language by formulating the clauses in a cohesive manner. The Chinese Text Sub-committee wishes to take this opportunity to express our appreciation towards the officers responsible for law drafting in Chinese for they have really devoted their greatest effort to convey the original English meaning in the Chinese text. Throughout the Bill, there are quite a number of long sentences and some are written in a clumsy style which makes comprehension difficult. However, as we have to adhere closely to the real legal meaning in the English text, there seems to be no other alternatives.
The major concern of the Chinese Text Sub-committee was not merely on the readability of the Chinese text, but rather the question of whether the text could meet the basic requirement of conveying the legal meaning with clarity and accuracy. If this requirement was met, the sub-committee still consider it acceptable even if one had to read the text several times carefully before grasping the meaning.
The Chinese Text Sub-committee had held 13 meetings before a package of about 50 amendments could be agreed. Most of the amendments are proposed to rectify the discrepancies relating to the legal meaning and semantic aspects of the provisions. Here are some examples:
(1) The Chinese text of clause 14(2) originally went like this: "除第(3)、 (4)、(5)及(6)款另有規定外，上述權力須予行使，以期把任何人持有的可變現財產變 現，從而獲有該等財產當時的價值，用作圓滿執行就被告所發出的任何沒收令。" while the English text reads: "Subject to
subsection (3), (4), (5) and (6), the powers shall be exercised with a view to making available for satisfying the confiscation order or, as the case may be, any confiscation order that may be made in the defendant's case the value for the time being of realizable property held by any person by the realization of such property." The original meaning in the English text does not imply that the powers must be exercised, but rather the exercise of the powers with a view to achieving certain proposes. And "satisfying the confiscation order" does not mean that the confiscation order has to be enforced satisfactorily, but rather "to effect payment under the confiscation order". The sub-committee therefore proposed to amend this clause to read: "當行使上述權力時，須以把任何人持有的可變現財產變現，從而獲取
該等財產當時的價值，用作繳付就被告而發出的沒收令所須付的款項為目標。
(2) The English text of clause 8(1)(b) reads "Section 114 of the Criminal Procedure Ordinance (Cap. 221) shall apply as if ...", but it has been rendered in Chinese as "在引用 刑事訴訟程序條例 (第 221 章)第 114 條時，須當作—". In fact, the English of this sub-clause does not provide for any discretionary power
relating to the application of the law. It simply states that the law has to be applied under circumstances specified. Therefore, the sub-committee proposed the Chinese text be amended to read "須引用 刑事訴訟程序條例 (第 221 章)第 114 條，猶如—".
(3) The Chinese text of clause 21(3) (c) (i) originally went like this: "如要 聯絡任何有權提交有關物料的㆟，在實行㆖有困難；或". The phrase "在實行㆖有困難" was used to render
the meaning of "it is not practicable". However, the Sub-committee was of the view that "not practicable" did not only imply "difficulty", it should also cover the meaning of "doing something that is impracticable and ineffective". As a result, it was proposed to amend this phrase to read "並不切實可行".
(4) The phrase "宣告破產" has been used repeatedly in clause 16. Under the Bankruptcy Ordinance, the court may adjudge a person as being bankrupt after a court hearing at the instance of any person. But a person cannot declare himself bankrupt. Thus the sub-committee was of the view that "宣告破產" should be amended to read " 被裁定破產".
On the other hand, there are a number of unfamiliar terms in the Chinese text of the Drug Trafficking (Recovery of Proceeds) Bill, for example:
(a) The Chinese text of "a gift caught by this Ordinance" is "受本條例囿 制饋贈". The word "囿" means a place enclosed by walls where animals are kept in captivity to prevent them from escape. Thus the term "囿制" is aptly applied to refer to a gift which cannot avoid the legal restraints intended by the Ordinance.
(b) "Seriously prejudice" has been rendered as "嚴重妨害". Although "prejudice" is normally rendered as "損害" 或 "不利 ", the term "妨害" which means "to prevent any obstruction which may in turn cause any harm" appears to be a more appropriate rendition for "prejudice".
(c) The penalties in the Bill are denoted by the phrases "可處罰款若干元" and "監禁若干年". Regarding the word "處", the sub-committee has made in-depth study on whether it should be replaced by "處罰" 或 "判處". The word "處" can be interpreted as to determine or to deal with. In Chinese, there is a phrase "處以 嚴刑" which means "to impose heavy punishment on criminals according to law".
Therefore, "處" is an extremely appropriate word to convey the meaning of "sentence".
In the debate on the Second Reading of the Securities and Futures Commission Bill 1989, I mentioned that the Legal Department were preparing for the compilation of a glossary on all the new terms and some unfamiliar expressions used in the Chinese texts of the Ordinances. Several pieces of bilingual legislation have now come into being and they have adopted numerous new terms like those mentioned above or
unfamiliar expressions which have been seldom used. I hope that the first edition of this glossary will be published soon, so that it may serve as a reference to be used by officers in the course of law drafting and law translation in future. Moreover, it will
enable consistency in the use of Chinese expressions and terms in different pieces of legislation, where appropriate.
Sir, with these remarks, I support the motion.
MR. PETER WONG: Sir, my colleague the Honourable Maria TAM has already explained in great detail the approach adopted by Members in studying the Bill. I will not therefore attempt to say anything further on general aspects but will instead concentrate on several technical points which arose during our examination of the Bill.
I would like to begin by referring to clause 8(1) of the Bill which allows an imprisonment term fixed in accordance with the amount charged against a person under the confiscation order, as if it were a term fixed under section 114(c) of the Criminal Procedure Ordinance. The ad hoc group finds this unsatisfactory because by so doing the court will appear to have a discretion to order an imprisonment term associated with the confiscation order to run either consecutive to or concurrent with an
imprisonment term arising from the drug trafficking offence. This ambiguity is deepened by the stated intention in the Legislative Council brief on the Bill that the former imprisonment term should be served in addition to the latter imprisonment term. The Administration agreed with the group's observation and an amendment will
be moved at Committee stage.
The second point relates to clause 20(4) of the Bill which spells out a number of conditions required to be satisfied before a person can be ordered to produce or allow access to certain material to an authorized officer. One of these conditions, under sub-clause 4(a), involves "reasonable grounds for suspecting" that a person has carried on or has benefited from drug trafficking. In line with the ad hoc group's thinking that the liability of and inconvenience to innocent third parties should be minimized as far as possible, an amendment will be made to alter this condition to "reasonable grounds for believing" that a person has carried on or has benefited from drug trafficking. Since the standard of proof required to establish there being a "belief" is higher than that of there being a "suspicion", the invocation of this power will therefore be confined to more limited circumstances.
Nowadays when office automation is the synonym for business efficiency, the capability of information technology is also fully exploited by drug traffickers. Thus it becomes inevitable that the Bill must allow authorized officers to gain access to data contained in computers or other electronic storage devices. The present provision under clause 20(7) only covers "information contained in a computer". This is clearly inadequate and out of step with the rapid technological advances prevailing today. The ad hoc group feels that a more comprehensive definition should be drawn up with reference to relevant provisions in the Securities and Futures Commission Ordinance. Accordingly, a new provision containing the definition of "data equipment" will be introduced at Committee stage to replace the present provision.
Finally, I wish to mention about clause 25(3) (b) of the Bill which accords protection to a person disclosing a suspicion or belief in connection with drug trafficking against the liability arising from a breach of restriction imposed by contract. Bearing in mind that those who are most likely to come across information or document from which such suspicion or belief can be derived are professionals bound by their own code of practice, the ad hoc group suggested that the protection be extended to liabilities arising from breach of professional ethnics. This was agreed by the Administration and will be addressed at Committee stage.
Having dealt with the technical points, I wish to highlight one aspect of the Bill from which possible inequalities or hardships could arise.
As we know, the whole purpose of the Bill is to deprive the drug trafficker of
his ill-gotten gains and not to enrich the government coffers at the expense of bona fide creditors. However, in calculating the monetary value of a restraint order, the vagaries of such an exercise can quite easily underestimate the amount available to satisfy creditors. An example could be a utility bill for an apartment rented by the trafficker. I do not think that it is the intention to prejudice the rights of such creditors and I would welcome an assurance from the Administration that
procedures will be put in place to prevent such an unfair treatment.
Sir, drug trafficking is a heinous crime and I personally have much sympathy for our Asian neighbours that prescribe the death penalty for it. However, the punishment appears to have little deterrent effect on the Mr. Bigs that control and finance such activities. The ones that have been caught are more to be pitied than objects of condemnation.
This legislation should allow our enforcement agencies to attack the traffickers where it hurts, by getting at the proceeds. In order to achieve that, I would have been happy to stick to the original much higher duty from bankers and other professionals to report on mere suspicion and not the lesser duty of "having reasonable grounds to believe".
Since the Administration is prepared to accept this lesser duty, I am also prepared to follow the majority but will watch the success rate of the legislation to put the Mr. Bigs out of business. We should not hesitate to use all appropriate means to tackle this hitherto unsolvable problem because we only have to see the way the cocaine barons of South America override even governments in their pursuit of the fast buck.
Sir, with these words, I support the motion.
SECRETARY FOR SECURITY: Sir, I am most grateful to Members for their support of this Bill. I am also indebted to Miss TAM and her ad hoc group for their in-depth scrutiny of the Bill during the past four months which has resulted in a number of amendments which will be moved during the Committee stage. I should also like to record my appreciation of the work of the Law Draftsman and those government officers who have been associated with this complex piece of legislation.
I should now like to address some of the points which have been raised today.
During the drafting and consultation stages there has been particular concern about the anti-money laundering provisions namely, clause 25. Miss TAM has mentioned the amendment, which has been agreed, which will replace the words "knowing or suspecting" with "knowing or having reasonable grounds to believe" in subclause (1). Clause 25 has two main objectives. First, in creating an offence with substantial penalties, it is intended to deny drug traffickers the banking and professional services through which their profits are channelled into legitimate investments. Secondly, in providing the defence of reporting, it is intended that the reporting of suspicions should be encouraged. This will assist in the investigation of drug trafficking offences. The Administration accepts the need to reduce the level of uncertainty as to what is required to be reported, and therefore considers the proposed amendment to be an acceptable compromise.
Mr. LI has raised three points on clause 25 which he thinks are unsatisfactory. His first point is that specific defences should be provided for bank employees, compliance officers and the banks themselves.
The Administration has been made aware of and appreciates the concern felt by financial institutions over the liability of their employees. However, it is not true that the Bill provides no defence for a person prosecuted under clause 25. Subclause (4) provides the defence that he did not know or suspect that the arrangement, as defined in subclause (1), into which he entered, related to the proceeds of drug trafficking. It also provides the defence that he intended to report the matter to an authorized officer but had a reasonable excuse for not doing so.
It is true that these defences are not designed specifically for bank transactions. But the clause is not directed solely at banks. Nevertheless, recognizing that banks and deposit-taking companies will be a major group of institutions to be affected, the Hong Kong Association of Banks and the Hong Kong Deposit-taking Companies Association, working closely with the Administration, have drawn up model guidelines which they will recommend to their member institutions. These guidelines aim to ensure that internal procedures are in place for individual staff members to report to the management transactions which are suspected or believed to be drug related. If the suspicion or belief is shared by the management, as represented by compliance officers, it will be further reported to the authorities. Where such guidelines are in place in an institution and an employee has followed them in good faith, but a tainted transaction has nevertheless not been relayed to the authorities, there would
be a good case for him, if indeed he was prosecuted at all to invoke the defence that he had reasonable excuse for failing to report to the authorities. In fact, it is highly unlikely that under such circumstances an employee would be prosecuted. The Attorney General has indicated that he will have regard to the existence and content of the model guidelines when considering whether to prosecute in individual cases. But it is, of course, not possible to fetter the discretion of the Attorney General whether or not to prosecute.
While still on this subject of guidelines for financial institutions, Sir, I wish to address Mr. LI's third point, which is, that the model guidelines drawn up by the two associations should be referred to in the legislation. Bearing in mind that the Bill is not directed solely at the banks, and that it would be entirely voluntary for any person or institution to draw up any guidelines for their staff, it would be very difficult to devise a legislative scheme having reference to such guidelines which could apply to all parties that may be affected by clause 25 of the Bill, and which would not significantly impair the effectiveness of the legislation.
Mr. LI has also referred to the need for specific defences for compliance officers and the banks themselves. I do not think it is necessary to provide any statutory defence for the compliance officer because he is not a person who would enter into an arrangement as such and hence would not attract any liability, unless complicity could be proved on his part. Furthermore, to give blanket immunity to banks which might be tainted by any offences committed by compliance officers would be unsatisfactory, as this would create a major loophole, having regard to the fact that a compliance officer is designated by the institution to represent the management, and given the general absence of liability on his part.
Mr. LI's second point is his wish to limit specifically the application of this law to transactions taking place in Hong Kong. Clause 25(1) clearly states that a person must enter into an arrangement before he can commit an offence. There is no need for the law to state that entering into an arrangement must take place in Hong Kong because there is a common law presumption that, in the absence of clear and compelling words, statutes will not be given extra-territorial effect. Laws in Hong Kong are all drafted on the basis of this presumption and there is no reason to depart from the principle in this case.
With the foregoing explanation and assurance, Sir, there is no need for bank employees to fear that they will be put into a difficult position by the proposed
legislation. Nevertheless, in view of the continuing concern of the financial sector, I agree that this part of the legislation should be kept under review in the light of practical experience gained from its operation and that a report should be made to this Council in due course.
Turning to the points made by Mr. Peter WONG, I note his concern that the operation of restraint orders should not be allowed to hurt bona fide creditors. I can assure Mr. WONG that this is not the intention of the legislation. In the United Kingdom it has been accepted by the courts that restraint orders made under the Drug Trafficking Offences Act, the legislation corresponding to our own Bill, operate on similar principles to the legally well-known "Mareva" injunctions in civil law. Thus, in making a restraint order, the court will ensure that it does not operate oppressively against third party creditors in respect of a defendant's bona fide business and trade debts, living expenses, legal expenses and other similar expenses. Provision will be made in the Supreme Court rules for conditions and exceptions to be attached to restraint orders. The courts should thus ensure that bona fide creditors are not prejudiced.
Miss LAU has discussed in detail various issues relating to the Chinese text which have been examined by the sub-group on the Chinese text which she has chaired. I wish to express my gratitude to her and her sub-group for the amendments which have resulted from their painstaking work and for the skill in which they have matched the Chinese wording to the complexities of English text.
Sir, I have two final points to make. Firstly, the financial institutions, being justifiably concerned about the possible effects of clause 25 on their operations, have asked that the legislation should not be implemented for at least three months after its enactment. However, because the major impact of the legislation on the financial sector arises only from clause 25, and considering the desirability of bringing the other provisions into effect as early as possible, the ad hoc group and the Administration have agreed that clause 25 should come into effect on a date later than the main part of the legislation. For this purpose I shall move an enabling amendment to clause 1(2) during the Committee stage.
Secondly, Sir, 1 wish to mention that the 1986 Drug Trafficking Offences Act was amended in 1988 in the United Kingdom. Some of these amendments, largely refinements, are considered suitable for Hong Kong and are included in the proposed Committee stage amendments.
Question on the Second Reading of the Bill put and agreed to. Bill read the Second time.
Bill committed to a Committee of the whole Council pursuant to Standing Order 43(1).
PRIVILEGES AND IMMUNITIES (THE INTERNATIONAL COMMITTEE OF THE RED CROSS) BILL 1989 Resumption of debate on Second Reading which was moved on 28 June 1989 Question on Second Reading proposed, put and agreed to.
Bill read the Second time.
Bill committed to a Committee of the whole Council pursuant to Standing Order 43(1).
BETTING DUTY (AMENDMENT) BILL 1989
Resumption of debate on Second Reading which was moved on 28 June 1989 Question on Second Reading proposed, put and agreed to.
Bill read the Second time.
Bill committed to a Committee of the whole Council pursuant to Standing Order 43(1).
PROTECTION OF WAGES ON INSOLVENCY (AMENDMENT) BILL 1989
Resumption of debate on Second Reading which was moved on 21 June 1989 Question on Second Reading proposed.
MR. CHUNG: Sir, I have first to declare that I am the chairman of the Protection of Wages on Insolvency Fund Board, which is charged with, among other things, the
duty of administering the fund established by the Protection of Wages on Insolvency Ordinance. The Ordinance provides for payments of wages in arrears and unpaid wages in lieu of notice from the fund to employees whose employers have become insolvent.
Financing of the fund is by way of a levy of $100 per annum on each Business Registration Certificate.
When the Ordinance came into effect in April 1985, it only provided for payment of wages in arrears on the insolvency of employers. Employees might seek payment from the fund of an amount up to four months' wages but not exceeding $8,000, as stipulated in the Bankruptcy and Companies Ordinance for preferential treatment of claims in cases of bankruptcy and liquidation.
In July 1987, the fund was extended to cover seven days' wages in lieu of notice or an amount not exceeding $2,000.
The purpose of the amendment Bill is to extend the scope of the fund to cover severance payments.
A Legislative Council ad hoc group was formed to examine the Bill. Two representations from concerned labour organizations have been received mainly on the setting of the maximum limit of payment for each applicant. They have requested that the limit should be set at $8,000, which is the amount stipulated in the Bankrupty and Companies Ordinance for preferential treatment of claims, or in another case $16,000. The ad hoc group, having duly considered the views conveyed in such representations, the views of the administration, the financial situation of the fund and the seemingly uncertain economic outlook ahead, has agreed to take a cautious approach by setting the limit of $4,000 as proposed in the Bill, subject to the Administration's promise to review the situation one year after the extension comes into effect.
It is gratifying to learn that the fund at present has an accumulated surplus of about $160,000,000. Nevertheless such surplus is the result of accumulation over the past few years during which Hong Kong enjoyed an economic boom. In order to prepare for the possible turn of the tide, it is vital to build up a reserve to cater for a possible downturn in the event of which payments from the fund could increase
tremendously. After the extension to cover severance payment, the fund's current maximum limit of payment per applicant would amount to $14,000, inclusive of $8,000
as arrears of wages, $2,000 as wages in lieu of notice and $4,000 as severance payment. The accumulated surplus so far would be wiped out by payments to about 11 500 employees or 0.40% of the entire labour force of about 2.7 million in certain scenario which, of course, no one would like to see happen.
As the Bill would give added protection to employees, the passage of this Bill is most welcome.
Sir, with these remarks, I support the Bill.
MR. PANG (in Cantonese): Sir, it can be said that the Protection of Wages on Insolvency (Amendment) Bill 1989 has rectified to a certain extent the inadequacies of the existing Ordinance.
The Bill seeks to extend the scope of the Protection of Wages on Insolvency Fund to cover severance payments. While the spirit of the Bill is encouraging, its actual effects are rather disappointing. Those employees who apply to the fund for severance payments as a result of their employers' insolvency can only admit with sighs that receiving a little compensation is better than none at all. It is because if for any reasons an employer goes bankrupt, those employees who have worked for him for a long time may lose almost all their wages, payments in lieu of notice as well as their long service gratuity, let alone severance payments.
It is, of course, unfortunate that employers become bankrupt, but we should have even greater sympathy for the employees concerned, for they are afforded very little protection by the meagre payments advanced from the fund.
During the Second Reading of the Bill, the Secretary for Education and Manpower has undertaken to conduct a review one year afterwards. I earnestly hope that within one year from the introduction of the new measures the authorities concerned will conduct a comprehensive review and make further amendments as necessary.
Sir, with these remarks, I support the motion.
MR. TAM (in Cantonese): Sir, being a member of the Protection of Wages on Insolvency Fund Board, I have stated time and again in this Council and at other public venues
that the scope of the fund should be further extended to cover severance payments. At long last, the Protection of Wages on Insolvency (Amendment) Bill 1989 is now introduced by the Administration into this Council for scrutiny before passing into law. Theoretically I should be very pleased with that move, but actually it is not the case.
It is not that I do not welcome the extension of the fund to cover severance payments, but I feel that it is unreasonable and too conservative for the fund to cover severance payments only up to the maximum limit of $4,000.
To criticize this limit as unreasonable is not an overstatement. Under the Companies Ordinance, in the case of companies becoming insolvent, the employees shall have preferential treatment of claims in the following areas: payment of wages in arrears up to $8,000, payment in lieu of notice up to $2,000 and severance payment of $8,000. All these payments are only meagre remunerations for the employees' hard work over the past years. The ceilings of claims were set 12 years ago, that is, in 1977, and they have not been adjusted in line with the inflation rate all these years. Hence, the protection afforded by the preferential treatment of claims is not so strong as before. Under the existing Bill, the maximum coverage of severance payment is limited to $4,000, which is contrary to the purpose of preferential treatments of claims, and the entitlements due to workers are thus undermined.
On the other hand, I also consider the proposed amendments to be too conservative. Over the past years, the fund has accumulated surpluses which have already accrued to some $160 million up to now. To adopt the existing proposal appears to be prudent, because a surplus of nearly $15 million will accrue annually. However, even if the coverage limit is set at $8,000, rough computation shows that the fund will still accumulate a surplus of several million dollars annually. I agree that it is safe to be prudent, but excessive prudence will lead to an over cautious approach which renders the fund unable to operate efficiently to the benefit of the majority. I have always subscribed to the view that the Protection of Wages on Insolvency Fund should put its "handsome" sum of surpluses to proper use and therefore I have
repeatedly insisted on extending its scope of protection. If the fund is not put into effective use, the result will be the continuous growth of the accumulated surpluses, and eventually it will meet with the fate of having the source of the fund "being cut". In view of the fund's "handsome" sum of surpluses, the Director of Accounting Services time and again wrote to the Protection of Wages on Insolvency Fund Board, requesting the reduction of the rate of levy on Business Registration
Certificate, which is tantamount to cutting the annual normal revenue of the fund. The proposal of cutting the revenue of the fund in order to reduce accumulation of surpluses can undoubtedly be likened to "chopping off one's toe to avoid the bite of worms". Can we not adopt a more constructive attitude by making effective use of the fund's revenue and maintaining surpluses at a reasonable level? A reasonable and suitable way of achieving this purpose is to set the coverage ceiling of severance payment at $8,000.
Due to the foregoing two reasons, I indeed have reservations about this Bill. However, during my absence from Hong Kong in the past three weeks, the ad hoc group came to a decision to support this Bill. Out of respect for the decision for the ad hoc group, I will support the motion, but I request the authorities to review this piece of legislation one year after its implementation, and to raise the coverage limit of the protection of wages in lieu of notice and severance payment.
Sir, with these remarks, I support the motion.
SECRETARY FOR EDUCATION AND MANPOWER: Sir, I would like to thank Mr. CHUNG Pui lam and members of his ad hoc group for their support of the Bill.
I am glad that the proposal to extend the ambit of the Protection of Wages on Insolvency Fund to include severance payments has been well received. The fund will now protect three main elements of an employee's entitlement under the Employment Ordinance, namely, wages in arrears, wages in lieu of notice and severance payments.
As regards the amount of severance payments to be borne by the fund, Mr. TAM Yiu-chung has argued that the proposed figure of $4,000 should be raised to $8,000, at least in keeping with the preferential limit for severance payments made under existing insolvency legislation.
Sir, I would point out that the purpose of the Protection of Wages on Insolvency Fund is to provide quick relief to employees who have suddenly lost their employment. When the proposed figure of $4,000 for severance payments is taken together with wages owed in arrears and wages payable in lieu of notice, the immediate relief can be as high as $14,000. Seen in this light, and having regard to the resources of the fund, it would seem prudent in the first instance to set the limit for severance payments at $4,000 per employee. This view is generally shared by the board controlling the
fund. We will, however, review the $4,000 limit after one year in the light of experience and the resources of the fund.
Question on the Second Reading of the Bill put and agreed to. Bill read the Second time.
Bill committed to a Committee of the whole Council pursuant to Standing Order 43(1).
4.23 pm
HIS EXCELLENCY THE PRESIDENT: Before we go on to the Committee stage and the debate, Members might like to take a short break.
5.01 pm
HIS EXCELLENCY THE PRESIDENT: Council now resumes.
Committee stage of Bills
Council went into Committee.
ARBITRATION (AMENDMENT) BILL 1989
Clauses 1 and 2 were agreed to.
COUNTRY PARKS (AMENDMENT) BILL 1989
Clauses 1 and 2 were agreed to
SUMMARY OFFENCES (AMENDMENT) BILL 1989
Clauses 1 to 5 were agreed to.
TEMPORARY CONTROL OF DENSITY OF BUILDING DEVELOPMENT (KOWLOON) BILL 1989 Clauses 1 to 3
MR. CHENG HON-KWAN: Sir, I move that the clauses specified be amended as set out in the paper circulated to Members.
The reference to "maximum height" in the definition of maximum plot ratio under clause 2(1) is misleading. The building heights shown on the deposited plans, for the purpose of calculating the maximum plot ratio, are the existing airport height restrictions (AHR) and can be exceeded under the relaxed AHR provided that the maximum plot ratio remain unexceeded. To avoid any possible confusion that this "maximum height" is the relaxed AHR, the ad hoc group suggested and the Administration agreed to add the word "notional", before "maximum height". The annotation to the deposited plans will be amended accordingly.
To achieve precision and to provide clarity to the readers, the phrase "to which regulation 19(1) applies" in clause 3 is also suggested to be deleted.
With these remarks, Sir, I beg to move.
Proposed amendments
Clause 1
That clause 1 be amended, by deleting "Kowloon" and substituting "Kowloon and New Kowloon".
Clause 2
That clause 2(1) be amended, in the definition of "maximum plot ratio"
( ) --
(a) by adding "notional" before "maximum height"; and
(b) by deleting "as permissible".
Clause 3
That clause 3(1) be amended, by deleting "to which regulation 19(1) applies,". Question on the amendments proposed, put and agreed to.
Question on clauses 1 to 3, as amended, proposed, put and agreed to. Clause 4 was agreed to.
Long title
MR. CHENG HON-KWAN: Sir, I move that the long title be amended as set out in the paper circulated to Members.
The ad hoc group is of the view and the Administration agreed that "New Kowloon" should be added to the title of the Bill to accurately reflect the physical scope of the controls to be imposed.
Sir, with these remarks, I beg to move.
Proposed amendment
Long title
That the long title be amended --
(a) by deleting "Kowloon" and substituting "Kowloon and New Kowloon"; and
(b) by deleting " ".
Question on the amendment proposed, put and agreed to.
Question on long title, as amended, proposed, put and agreed to.
DRUG TRAFFICKING (RECOVERY OF PROCEEDS) BILL 1989
Clauses 9 and 30 to 32 were agreed to.
Clauses 1 and 28
SECRETARY FOR SECURITY: Sir, I move that clauses 1 and 28 be amended as set out in the paper circulated to Members.
As I have said earlier this afternoon, having considered the request of the financial sector, the ad hoc group have agreed that clause 25 should be implemented three months after the rest of the legislation has come into effect. The amendment to clause 1 will enable this to be done. It is intended that only subclauses (1), (2), (3)(a), (4) and (5) of clause 25 will have a later commencement date, but not subclause (3)(b) and (c). The effect of this is that, during the three-month period, a person will not be required by law to report any transactions known or believed to be related to proceeds of drug trafficking. However, if he should report, he would not breach any duty of confidentiality that he may owe to his clients, or attract any liability for any loss arising from such reporting.
The amendments to clause 28 serve three purposes: first, to extend the possible application of the legislation to external confiscation orders and proceedings to include, in particular, the investigative provisions in Part IV of the Bill; second, to clarify that a modification to the legislation for the purpose of such application includes a modification to confer a discretionary power; and finally, to simplify the language. These amendments are similar to those made to the 1986 Drug Trafficking Offences Act in the United Kingdom.
With these remarks, Sir, I beg to move.
Proposed amendment
Clause 1
That clause 1 be amended, in subclause (2) by adding "and different days may be so appointed for different provisions and for different purposes" after "Gazette".
Clause 28
That clause 28 be amended --
(a) in subclause (1) by deleting paragraph (a) and substituting --
"(a) direct in relation to a country or territory outside Hong Kong designated by the order ("a designated country") that, subject to such modifications as may be specified, this Ordinance shall apply to external confiscation orders and to proceedings which have been or are to be instituted in the designated country and may result in an external confiscation order being made there;";
(b) by adding after subclause (2) --
"(3) The power to make an order under this section includes power to modify this Ordinance in such a way as to confer power on a person to exercise a discretion.
(4) In this section and section 29 -
"external confiscation order" means an order made by a court in a designated country for the purpose of recovering payments or other rewards received in connection with drug trafficking or their value;
"modifications" includes additions, alterations and omissions.". Question on the amendment proposed, put and agreed to.
Question on clauses 1 and 28, as amended, proposed, put and agreed to. Clauses 2, 13 and 14
MRS. LAU (in Cantonese): Sir, I move that the clauses specified be amended as set out under my name in the paper circulated to Members.
The insertion of "已"before "被定罪" in the definition of defendant is to convey more accurately the English meaning of "has been convicted".
In relation to the proposed amendment to the definition of drug trafficking, we consider that "取得" reflects more accurately the meaning of "acquire". The original version "購置" has a narrower meaning than "acquire".
As regards the proposed amendment to clause 13(1) (c) (ii) in the Chinese text, it serves to spell out clearly that the burden to satisfy the confiscation order is on the defendant.
Proposed amendments
Clause 2
That clause 2 be amended --
(a) in subclause (1) --
(i) in the definition of "被告" (defendant) by adding "已" after "是 否";
(ii) in paragraph (ii) in the definition of "販毒" (drug trafficking) by deleting "購買" and substituting "取得";
(b) in subclause (4) by deleting "本條例對任何法庭並無委予法庭任何職責"and " 本條例並無 委予法庭任何職責"; and
(c) in subclause (7) by deleting "任何" from "任何財產".
Clause 13
That clause 13 be amended --
(a) in subclause (1) --
(i) by deleting " " from "第 條或抵押令" and substituting in its place "或";
(ii) in paragraph (ii) by deleting "為被告用以圓滿執行沒收令" and substituting
"為被告繳付根據沒收令所須付的款項"; and
(b) in subclause (2) --
(i) by deleting "給予" and adding "獲得" after "有關㆟等";
(ii) in paragraph (a) by deleting " " and substituting "而". Clause 14
That clause 14 be amended --
(a) in subclause (2) by deleting "㆖述權力須予行使" and all the words that follow them and substituting "當行使㆖述權力時 須以把任何㆟持有的可變現財 產變現 從而獲取該等財產當時的價值 用作繳付就被告而發出的沒收令所須付的款項 為目標 "
(b) in the Chinese version by deleting subclauses (3) and (4) and substituting--
" 3 如某㆟持有的可變現產是由被告直接或間接向他作出的饋贈 而 該饋贈是受本條 例囿制的 當行使㆖述權力時 須以變現可得款額不超逾該饋贈 當時的價值為目標 ".
Question on the amendments proposed, put and agreed to.
SECRETARY FOR SECURITY: Sir, I move that the clauses specified be further amended as set out under my name in the paper circulated to Members.
The amendments to clause 2 are mainly drafting amendments to improve style and
clarity of meaning. The amendment to subclause (12)(e) of clause 2 is consequential to the amendment to clause 3 to be moved by Miss TAM.
The amendments to clause 13 follow similar amendment to the corresponding law in the United Kingdom. They are to provide for the payment from realized property of the expenses of a receiver or liquidator appointed other than for the purposes of a confiscation order, in priority over any other payment. This will further protect the interests of such receiver or liquidator when their functions may come into
conflict with the functions of receivers appointed under the Bill.
The amendment to clause 14 is to use the word "Government" rather than "Crown", to make it clear that the reference is to the Government.
Proposed amendment
Clause 2
That clause 2 be further amended --
(a) in subclause (1) in the definition of "drug trafficking offence" by deleting "the offence of" where it occurs in paragraphs (b), (c), (d) and (e);
(b) in subclause (5) by deleting "anything" in both places where it occurs and substituting, in each case, "property";
(c) in subclause (12) --
(i) in paragraph (b) by adding "within the meaning of subsection (13)" after "review";
(ii) in paragraph (e) by deleting "without the making of a confiscation order" and substituting "where the Attorney General either does not apply for a confiscation order, or applies for a confiscation order and the order is not made".
Clause 13
That clause 13 be further amended --
(a) in subclause (1) by adding "first be applied in payment of such expenses incurred by a person acting as an insolvency officer as are payable under section 18(2) and then shall" after "shall";
(b) by deleting subclause (3) and substituting --
"(3) The receipt of any sum by the Registrar on account of an amount payable under a confiscation order shall reduce the amount so payable, but the Registrar shall apply the sum received for the purposes specified in this section and in the order so specified.
(4) The Registrar shall first pay any expenses incurred by a person acting as an insolvency officer and payable under section 18(2) but not already paid under subsection (1).
(5) If the sum was paid to the Registrar by a receiver
appointed under section 10 or 12 or in pursuance of a charging order the Registrar shall next pay the receiver's remuneration and expenses.
(6) After making --
(a) any payment required by subsection (4); and
(b) in a case to which subsection (5) applies, any
payment required by that subsection, the Registrar shall reimburse any amount paid under section 19(2).
(7) Any balance in the hands of the Registrar after he has made all payments requird by the foregoing subsections shall be disposed of under section 93 of the Interpretation and General Clauses Ordinance (Cap. 1) as if it were a fine imposed under the authority of an Ordinance.".
Clause 14
That clause 14 be further amended, in subclause (5) by deleting "Crown" and substituting "Government".
Question on the amendments proposed, put and agreed to.
Question on clauses 2, 13 and 14, as amended, proposed, put and agreed to.
Clause 3
MISS TAM: Sir, I move that clause 3 be amended as set out under my name in the paper circulated to Members.
The proposed amendment to clause 3(1)(c) aims to cater for cases where the defendant absconds after conviction and before a confiscation has been made.
The ad hoc group has given careful consideration to and expressed reservation on the original provision in this clause about the Court having to delay passing sentence on a person until the completion of the confiscation investigations. After discussion with the Administration, it was agreed that to provide flexibility, the clause should be amended to allow sentencing for specific drug trafficking offence to be imposed and any other order to be made by the Court before the completion of confiscation procedures.
Sir, with these remarks, I beg to move.
Proposed amendment
Clause 3
That clause 3 be amended --
(a) in subclause (1) (a) --
(i) by deleting "a person appears before the High Court or the District Court" and substituting "in proceedings before the High Court or the District Court a person is";
(ii) by deleting "or otherwise dealt with"; and
(b) by adding after subclause (1) --
"(1A) The court shall first --
(a) impose such period of imprisonment or detention (if any);
(b) make such other order in relation to sentence, not being an order provided for or referred to in subsection (5), as is
appropriate in respect of the offence, or as the case may be, the offences concerned.";
(c) in subclause (2) by deleting "first" and substituting "then";
(d) in subclause (4) by deleting ", before sentencing or otherwise dealing with him in respect of the offence, or, as the case
may be, any of the offences concerned,";
(e) in subclause (5) --
(i) by adding "or offences" after "offence";
(ii) by deleting "; and" at the end of paragraph (b)
(iii);
(iii) by deleting paragraph (c); and
(f) by adding after subclause (5) --
"(6) For the purposes of any Ordinance conferring
rights of appeal in criminal cases, an order made against
a person under this section shall be treated as a sentence
passed on that person in respect of the offence or
offences concerned.".
Question on the amendments proposed, put and agreed to.
Question on clause 3, as amended, proposed, put and agreed to.
Clause 4
MRS. LAM (in Cantonese): Sir, I move that clause 4 be amended as set out under my name in the paper circulated to Members.
Proposed amendment
Clause 4
That clause 4 be amended --
(a) in subclause (2) by adding "該等假設" before "不能成立";
(b) in subclause (3) (a) by deleting "看來是"and "看來為" and substituting in each case "認為是";
(c) in subclause (5) by deleting "則須 在法庭見到證明後 " and substituting " 則 法庭在見到證明後 須".
Question on the amendment proposed, put and agreed to.
MRS. LAU (in Cantonese): Sir, I move that clause 4 be further amended as set out under my name in the paper circulated to Members.
Sir, I beg to move.
Proposed amendment
Clause 4
That clause 4 be further amended, in the Chinese version by deleting subclause (3) (c) and substituting --
" 為評定被告在任何時間收受或假設他曾經收受有關款項或酬賞的財產價值 該財產
須視作不存有 任何其他權益 "
Question on the amendment proposed, put and agreed to.
MR. PETER WONG: Sir, I move that clause 4 be further amended as set out under my name in the paper circulated to Members.
Sir, I beg to move.
Proposed amendment
Clause 4
That clause 4 be further amended --
(a) in subclause (3) (c) by deleting "presumed" and substituting "assumed"; (b) in subclause (4) --
(i) by deleting "appears before the court" and substituting "is"; (ii) by deleting "26" and substituting "25".
Question on the amendment proposed, put and agreed to.
Question on clause 4, as amended, proposed, put and agreed to. Clauses 5 and 7
MRS. LAM (in Cantonese): Sir, I move that clauses specified be amended as set out under my name in the paper circulated to Members.
The proposed amendment to clauses 5(4) and 7(3) to replace "可變現的款額" by " 變現可得的款額" would remove the ambiquity of being taken to mean that the cash is to be realized which in reality is not quite possible.
Sir, with these remarks, I beg to move.
Proposed amendments
Clause 5
That clause 5 be amended --
(a) in subclause (1) by adding "為" after "及" and by deleting "的目的" after "價值"*;
(b) in subclause (4) by deleting "可變現的款額" in both places where it occurs and substituting "變現可得的款額".
Clause 7
That clause 7 be amended, in subclause (3) by deleting "可以變現的款額" and substituting "變現可得的款額".
Question on the amendments proposed, put and agreed to.
MRS. LAU (in Cantonese): Sir, I move that the clauses specified be amended as set out under my name in the paper circulated to Members.
The proposed amendment to clause 7(4)(a)(i) would help to clarify who is the "first mentioned person" as it is in the English version.
As to subclause 7(7)(b), the replacement of "宣告破產" by "被裁定破產" aims to reflect more accurately the legal procedure in bankruptcy prcoeedings.
Sir, I beg to move.
Proposed amendments
Clause 5
That clause 5 be further amended, in subclause (6) by deleting "作為" and substituting "接受為".
Clause 7
That clause 7 be further amended --
(a) in subclause (4) (a) (i) by deleting "該㆟" and substituting "該財產持有 ㆟";
(b) in subclause (7) (b) by deleting "宣告破產" and substituting "被裁定破產 ".
Question on the amendments proposed, put and agreed to.
Question on clauses 5 and 7, as amended, proposed, put and agreed to.
Clauses 6, 21 and 23
MRS. LAM (in Cantonese): Sir, I move that clauses specified be amended as set out in the paper circulated to Members.
The purpose of the amendment to clauses 6(2) and (3) is similar to clauses 5(4) and 7(3). My previous comments therefore also apply to these amendments.
In clause 21(3)(c)(i), we consider that "在實行㆖有困難" cannot convey fully the meaning of "it is not practicable to communicate....." in the English text. The aforesaid English phrase may also carry the meaning that it is not wise to communicate with the person concerned. Hence, we propose to replace "在實行㆖有困難" by "並 不切實可行".
Proposed amendments
Clause 6
That clause 6 be amended, in subclauses (2) and (3) by deleting "可變現的款額"
wherever it occurs and substituting "變現可得的款額".
Clause 21
That clause 21 be amended --
(a) in subclause (3) (c) (i) and (ii) by deleting "在實行㆖有困難" wherever it occurs and substituting "並不切實可行";
(b) in subclause (4) --
(i) in paragraph (b) by deleting " 不論是由於物料本身或因為與其他物 料㆒ 起 對與該項申請有關的偵查可能有重大價值" and substituting " 不論是 物料本身 或連同其他物料 對與申請有關的偵查 相當可能有重大價值";
(ii) in paragraph (c) (i) by deleting "在實行㆖有困難" and substituting "並不切實可行";
(c) in subclause (5) --
(i) by deleting "檢取及扣押" and substituting "扣押及扣留";
(ii) by deleting " 不論是由於物料本身或與其他物料㆒起 可能對與該 令狀有關 的偵查有重大價值的物料" and substituting " 不論是物料本身或連同 其他物料 對 與該令狀有關的偵查相當可能有重大價值的物料".
Clause 23
That clause 23 be amended--
(a) In subclause (2) by deleting "可單獨憑藉(b)段行使" and substituting "是單 獨 憑藉(b)段而可行使";
(b) in subclause (3) (b) by deleting "提供" and substituting "造"; (c) in subclause (4) by adding "相當" before "可能";
(d) in subclause (6) by deleting "在本條例㆘的職能的目的" and substituting "
履行 本條例㆘的職能";
(e) in subclause (10) by deleting "㆒如控告官方的民事訴訟程序" and substituting "恰如在控告政府的民事訴訟程序所採用的".
Question on the amendments proposed, put and agreed to.
Question on clauses 6, 21 and 23, as amended, proposed, put and agreed to.
Clause 8
MR. PETER WONG: Sir, I move that clause 8 be amended as set out in the paper circulated to Members.
In clause 8(3), the proposed inclusion of a new clause (3A) aims to specify that the term of imprisonment fixed in respect of a confiscation order shall not begin to run until after the end of the term of imprisonment the defendant has served in respect of the offence or offences concerned. It further specifies that consecutive terms and terms which are wholly or partly concurrent shall be treated as a single term.
Sir, with these remarks, I beg to move.
Proposed amendment
Clause 8
That clause 8 be amended --
(a) in subclause (1) --
(i) in paragraph (a) by deleting "undergo" and substituting "serve";
(ii) in paragraph (b) by adding "(1), (3), (4), (5), (6) and (7)" after "section 114" where it first occurs;
(b) in subclause (2) by deleting "periods" in both places where it occurs and substituting, in each case, "terms";
(c) by adding after subclause (3) --
"(3A) Where the defendant --
(a) becomes liable to serve a term of imprisonment fixed
under this section in respect of a confiscation order; and
(b) is also liable to serve a term of imprisonment or
detention in respect of the offence or offences concerned, the term of imprisonment mentioned in paragraph (a) shall not begin to run until after the end of the term of imprisonment or detention mentioned in paragraph (b).
(3B) For the purposes of subsection (3A) --
(a) consecutive terms and terms which are wholly or partly
concurrent shall be treated as a single term; and
(b) there shall be disregarded --
(i) any sentence suspended under section 109B of
the Criminal Procedure Ordinance (Cap. 221) which has
not taken effect at the time the defendant becomes liable
to a term of imprisonment under this section; and
(ii) any term of imprisonment fixed under section
114(1) of the Criminal Procedure Ordinance (Cap. 221)
for which the defendant has not at that time been
committed.";
(d) in subclause (4) by deleting "period" and substituting "term". Question on the amendment proposed, put and agreed to.
Question on clause 8, as amended, proposed, put and agreed to. Clauses 10, 15, 16, 18 and 19
MRS. LAU (in Cantonese): Sir, I move that the clauses specified be amended as set out in the paper circulated to Members.
In clause 10, we consider that " 可由法官在 內 庭 應單方面的聆訊形式申請而發 出 " reflects
more clearly and accurately the legal procedure of an ex-parte application. We therefore propose that the Chinese version as originally proposed by the Administration should be amended.
The purpose of the amendments to clauses 15(2)(a), 16(1), 16(1)(a), 16(2), 16(4) and 16(6) are similar to those proposed to clause 7(7)(b). My previous comments therefore also apply to these amendments.
The reason for the proposed amendment to clause 14(2) has been explained by me during the Second Reading debate on the Bill.
Sir, I beg to move.
Proposed amendments
Clause 10
That clause 10 be amended, in the Chinese version by deleting subclause (4) (b) and substituting --
"(b)可由法官在內庭應單方面的聆訊形式申請而發出; 及".
Clause 15
That clause 15 be amended, in subclause (2) -
(a) in paragraph (a) by deleting "宣告破產" and substituting "被裁定破產"; (b) in paragraph (b) by deleting "使不因" and substituting 使其不因". Clause 16
That clause 16 be amended --
(a) in subclause (1) --
(i) by deleting "宣告破產" and substituting "被裁定破產";
(ii) in paragraph (a) by deleting "宣告破產令" and substituting " 裁定破產 令";
(b) in subclause (2) by deleting "宣告破產" and substituting "被裁定破產"; (c) in the Chinese version by deleting subclause (4) and substituting - " (4) 抵押令如 —
(a) 在裁定有關的㆟破產的命令發出之前已發出；或
(b) 在裁定破產令發出時，供抵押的財產已經受到限制令所限，
則第(2)款不影響該抵押令的執行。";
(d) in subclause (6) by deleting "宣告破產" and substituting "被裁定破產"; (e) in subclause (6) (b) by deleting "考慮及" and substituting "顧及". Clause 18
That clause 18 be amended, in subclause (1) by deleting "有權留置以支付他用於有關 的清盤、破產或其他訴訟㆖的開支" and substituting "有權留置足以支付他用於有關的 清盤、破產或其他指 稱是與扣押或處置該財產有關的訴訟㆖的開支". Clause 19
That clause 19 be amended --
(a) in subclause (1) -
(i) in "第10、12 條例或抵押令" by deleting "、" and substituting "或";
(ii) by deleting "作出" and "行為" wherever it occurs and
substituting respectively "採取" and "行動";
(b) in subclause (2) by adding "就其申請" after "須由提出申請而". Question on the amendments proposed, put and agreed to.
Question on clauses 10, 15, 16, 18 and 19, as amended, proposed, put and agreed to.
Clause 11
SECRETARY FOR SECURITY: Sir, I move that clause 11 be amended as set out under my name in the paper circulated to Members.
Paragraph (a) of the amendment is to substitute the word "Government" for "Crown". Paragraph (b) is to make the provision consistent with similar charging order provisions in the Supreme Court Ordinance, so that a charging order under the Bill will not be applied to rent or royalty income from property. There are other means in the Bill, by restraint orders for example, for preserving income for the satisfaction of a confiscation order.
Sir, I beg to move.
Proposed amendment
Clause 11
That clause 11 be amended --
(a) by deleting "Crown" where it occurs in subclauses (1) and (2) and substituting, in each case, "Government";
(b) in subclause (5) by deleting "rent, royalty,".
Question on the amendment proposed, put and agreed to.
MR. CHAN (in Cantonese): Sir, I move that clause 11 be further amended as set out
under my name in the paper circulated to Members.
The proposed amendment to clause 11(6) by deleting "完結" and substituting " 結束" aims to achieve better consistency with clauses 2(12), 9(1)(b), 16(6)(a) and (b) where "訴訟結束" are used for "conclusion of proceedings".
Sir, with these remarks, I beg to move.
Proposed amendment
Clause 11
That clause 11 be further amended --
(a) in subclause (1) (a) by deleting "經常" and substituting "不時 "; and (b) in subclause (6) by deleting "完結" and substituting "結束". Question on the amendment proposed, put and agreed to.
MRS. LAU (in Cantonese): Sir, I move that clause 11 be further amended as set out under my name in the paper circulated to Members.
The purpose of the amendment to subclause 3(b) is similar to that proposed to clause 10(4)(b). My previous comments therefore also apply to this amendment.
Sir, I beg to move.
Proposed amendment
Clause 11
That clause 11 be further amended, in the Chinese version by deleting subclause (3) (b) and substituting --
"(b)可由法官在內庭應單方面的聆訊形式申請而發出；".
Question on the amendment proposed, put and agreed to.
Question on clause 11, as amended, proposed, put and agreed to. Clause 12
SECRETARY FOR SECURITY: Sir, I move that clause 12 be amend as set out under my name in the paper circulated to Members.
The amendment in paragraph (a) is a drafting amendment and the one in paragraph (b) is to make the wording in the clause consistent with that in clause 11 as amended.
Sir, I beg to move.
Proposed amendment
Clause 12
That clause 12 be amended --
(a) in subclause (1) (b) by adding "or review within the meaning of section 2(13)" after "appeal";
(b) in subclause (3) (a) by deleting "rent, interest or dividends payable" and substituting "any interest, dividend or other distribution payable and any bonus issue".
Question on the amendment proposed, put and agreed to.
MR. CHAN (in Cantonese): Sir, I move that clause 12 be further amended as set out under my name in the paper circulated to Members.
Proposed amendment
Clause 12
That clause 12 be further amended --
(a) in subclause (1) (c) by deleting "完結" and substituting "結束"; and (b) in subclause (3) (b) by deleting "的財產".
Question on the amendment proposed, put and agreed to.
Question on clause 12, as amended, proposed, put and agreed to.
Clauses 17 and 27
SECRETARY FOR SECURITY: Sir, I move that clauses 17 and 27 be amended as set out under my name in the paper circulated to Members.
The amendment to clause 17 is to delete superfluous words. Clauses 13 and 18 provide for the payment of the liquidator's expenses.
The amendments to clause 27 follow similar amendments to the United Kingdom 1986 Drug Trafficking Offences Act. The first part of the amendment in paragraph (a) extends the court's decision to award compensation where a conviction is subsequently quashed. It is considered that a person should be allowed to apply for compensation irrespective of whether or not conviction for any other drug trafficking offence is substituted. The second part of the amendment clarifies the nature of the court's discretion. That is, the court may order compensation if, having regard to all the circumstances, it considers it appropriate to make such an order.
Paragraphs (b) and (c) amend subclause (2). This will extend the circumstances under which compensation may be awarded by:
(a) removing the requirement that the claimant must satisfy the court that the default in the investigation or prosecution was responsible for the investigation or prosecution being instituted or continuing; and
(b) removing the requirement that the claimant's loss must be "substantial".
New subclause (2A) ensures that compensation would not be payable in a situation where a serious default was responsible for an investigation not going ahead in circumstances where it should have done so.
The amendments in paragraphs (d) and (e) to subclauses (3) and (4) respectively are made for the same reasons as similar amendments to subclauses (1) and (2).
With these remarks, Sir, I beg to move.
Proposed amendments
Clause 17
That clause 17 be amended, in subclause (1) by deleting "but there shall be payable out of such property any expenses (including the remuneration of the liquidator or provisional liquidator) properly incurred in the winding up in respect of the property".
Clause 27
That clause 27 be amended --
(a) in subclause (1) --
(i) in paragraph (c) (i) by deleting "(and no conviction for any drug trafficking offence is substituted)";
(ii) by adding at the end "if, having regard to all the circumstances, it considers it appropriate to make such an order";
(b) in subclause (2) --
(i) in paragraph (a) by deleting "and that, but for that default, the investigation would not have begun or continued or the proceedings would not have been instituted or continued, as the case may be";
(ii) in paragraph (b) by deleting "substantial";
(c) by adding after subclause (2) --
"(2A) The High Court shall not order compensation to be paid
under subsection (1) in any case where it appears to the High Court that the investigation would have been continued, or the proceedings would have been instituted or continued, as the case may be, if the serious default had not occurred.";
(d) in subclause (3) by adding at the end "if, having regard to all the circumstances, it considers it appropriate to make such an order";
(e) in subclause (4) (b) by deleting "substantial".
Question on the amendments proposed, put and agreed to.
MR. MICHAEL CHENG: Sir, I move that the clauses 17 and 27 be further amended as set out under my name in the paper circulated to Members.
The ad hoc group considers that the proposed amendment to clause 17(5) in the definition of "有關時間" in the Chinese text has provided a clearer picture on the time frame.
Sir, I beg to move.
Proposed amendments
Clause 17
That clause 17 be further amended, in subclause (5) in the definition of "有關時 間" by deleting paragraph (b) and substituting --
"(b) 如㆖述命令已經發出 而在向高等法院提出稟狀申請將有關公司清盤前 該公 司已通過自行 清盤的決議 則是指通過該決議的時間; 及".
Clause 27
That clause 27 be further amended, in subclause (3) by adding "曾" before "持有該 財產的㆟*".