Hong Kong's Duty Stamp System Pilot Run Advances to Second Phase After Successful Initial Testing

Hong Kong Customs commences second phase of Pilot Run for Duty Stamp System

The first phase of the three-month Pilot Run for the Duty Stamp System launched by Hong Kong Customs on October 6 was completed recently and entered into the second phase starting yesterday (November 17).

The first phase of the Pilot Run, aimed to simulate the operational procedures of the Duty Stamp System in a real setting for testing related technologies and getting prepared for the next phase of testing. During the first phase, Customs not only affixed trial duty stamps to duty-paid cigarettes brought into Hong Kong by travellers or imported via small shipments at the Duty Collection Offices, but also conducted technical tests in actual operational environments using equipment from local cigarette manufacturers. This included building a computer module for testing the data system, affixing trial duty stamps during the production process, the storage of products in bonded warehouses after production, and releasing them to the retail market after duty payment, covering the entire logistics chain.

The test results of the first phase and opinions collected through questionnaires reflected that the general public indicated a positive attitude towards the design of the duty stamp and a success rate of over 99 per cent in the affixation of stamps during production was achieved.

In the second phase of the Pilot Run, Customs will use enhanced trial duty stamps which adopt thinner paper and a hologram as an anti-counterfeiting feature in the design. Cigarettes affixed with stamps, depending on their status of duty payment, will be available at retail outlets across all districts successively, allowing more members of the public access to the trial duty stamps.

Meanwhile, the second phase of the Pilot Run will be extended to cover more Duty Collection Offices at various control points, including Lo Wu, Heung Yuen Wai, and the West Kowloon Station of the Guangzhou-Shenzhen-Hong Kong Express Rail Link, for affixing trial duty stamps to cigarettes carried by travellers exceeding the duty free concession after payment of duties.

Customs will continue to promote the Duty Stamp System and actively communicate with the tobacco industry (including cigarette importers), as well as invite them to participate in the second phase of the Pilot Run. Customs will hold briefing sessions to provide more information on the duty stamp affixing procedures information, and distribute trial duty stamp samples for reference. Customs will also collect feedback from the industry through questionnaires with a view to enhancing the planning of the Duty Stamp System and thus achieve the ultimate goal of effective distinguishment of duty-paid cigarettes from duty-not-paid ones, and to combat the "cheap whites".

In response to the presence of sales outlets selling suspected duty-not-paid cigarettes below tobacco duty on the market, Customs will continue to step up patrol operations and closely monitor the latest market situation. Customs will take decisive enforcement action if any form of illicit cigarette trading activities is found.

Under the amended Dutiable Commodities Ordinance (DCO), cigarettes sold at a price lower than the tobacco duty must be proven to be duty-paid, otherwise the cigarettes are presumed to be duty-not-paid.

Customs appeals to retailers not to sell cigarettes from unknown sources. Retailers must stay vigilant against cigarettes with wholesale prices lower than the tobacco duty in order to avoid criminal liability. Customs reminds retailers and members of the public that under the DCO, anyone involved in dealing with, possession of, selling or buying illicit cigarettes commits an offence. The maximum penalty upon conviction is a fine of $2 million and imprisonment for seven years.

Hong Kong Customs commences second phase of Pilot Run for Duty Stamp System Source: HKSAR Government Press Releases

Hong Kong Customs commences second phase of Pilot Run for Duty Stamp System Source: HKSAR Government Press Releases

Hong Kong Customs commences second phase of Pilot Run for Duty Stamp System Source: HKSAR Government Press Releases

Police National Security Department arrests one man

The National Security Department of the Hong Kong Police Force (NSD) took enforcement actions in Sheung Shui today (December 6) and arrested a 71-year-old local man, for being suspected of "prejudicing of investigation of offences endangering national security" and "doing an act that has a seditious intention with a seditious intention" in contravention of Section 88 and 24 of the Safeguarding National Security Ordinance respectively.

Investigation revealed that the arrested man was suspected of disclosing details of a case endangering national security, after assisting with the investigation conducted earlier by NSD officers. He was also suspected of publishing multiple videos with seditious intention online, with content provoking hatred towards the Central Authorities, the Government of the Hong Kong Special Administrative Region and the Judiciary.

The man is being detained for further enquiries.

Police took law enforcement actions based on evidence and in accordance with the actual circumstances, and applied Section 88 of the Safeguarding National Security Ordinance for the first time. The article stipulated that if a person knows or suspects that an investigation of an offence endangering national security is being conducted, the person with intent to prejudice the investigation; or being reckless as to whether the investigation will be prejudiced, without reasonable excuse or lawful authority, makes any disclosure; or the person knowing or suspecting that any material is likely to be relevant to the investigation; and with intent to conceal the facts disclosed by the material from persons conducting the investigation, without reasonable excuse, falsifies, conceals, destroys or otherwise disposes of the material, or causes or permits the material to be falsified, concealed, destroyed or otherwise disposed of, commits an offence. Offenders shall be liable to imprisonment for seven years upon conviction.

Police remind members of the public that "doing an act that has a seditious intention with a seditious intention" is also a serious offence. Offenders shall be liable to imprisonment for seven years on first conviction.

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