Consultation on Reporting System on Cross-Boundary Transportation of Large Quantities of Currency and Bearer Negotiable Instruments

The Security Bureau released a consultation paper in July on its proposal to establish a reporting system for physical cross-boundary transportation of large quantities of currency and bearer negotiable instruments (“CBNIs”). Under the proposal, passengers arriving in Hong Kong carrying CBNIs valued at over HK$120,000 should, when undergoing Customs clearance, use the Red Channel under the prevailing Red and Green Channel System and make a declaration. Passengers who do not carry CBNIs exceeding such a threshold can go through the Green Channel. Those leaving Hong Kong will need to disclose the amount of CBNIs carried when asked by a Customs officer. Persons responsible for the import or export of cargoes containing CBNIs above the designated threshold should make an advance declaration through an electronic system, in line with the existing systems for the clearance of cargoes.

According to the Administration, the above proposal underlines the effort of Hong Kong to comply with standards established by the Financial Action Task Force on anti-money laundering and counter-financing of terrorism. The proposal is to enable law enforcement agencies to detect and to stop the physical movement of illicit funds across the boundaries of different jurisdictions.

The consultation paper was considered by the Council with the assistance of the Constitutional Affairs and Human Rights Committee and the Criminal Law and Procedure Committee of the Law Society. The Council reviewed and endorsed the draft submission jointly prepared by the two Committees to respond to the consultation paper.

The Law Society is, generally speaking, in support of most of the proposals set out in the consultation paper.

Apart from providing answers to the consultation questions, the Law Society also offered views on criminal sanctions and the important principle that there should not be any currency control brought by the recommended reporting system.

The full submission can be found at the Law Society’s website:
http://www.hklawsoc.org.hk/pub_e/news/submissions/20151015.pdf.

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