DRUG TRAFFICKING (RECOVERY OF PROCEEDS) ORDINANCE

DRUG TRAFFICKING (RECOVERY OF PROCEEDS) ORDINANCE

LAWS OF HONG KONG


DRUG TRAFFICKING (RECOVERY OF
PROCEEDS) ORDINANCE


CHAPTER 405

REVISED EDITION 1989





CHAPTER 405

DRUG TRAFFICKING (RECOVERY OF PROCEEDS) ORDINANCE

ARRANGEMENT OF SECTIONS

Section.................................... Page

PART I

PRELIMNARY

1. Short title ...........................6
2. Interpretation ........................6

PART II

CONFISCATION OF PROCEEDS OF DRUG TRAFFICKING

3. Confiscation orders ................................................................................... 12
4. Assessing the proceeds of drug trafficking 14
5. Statements relating to proceeds of drug trafficking 16
6. Amount to be recovered under confiscation order 18
7. Definition of principal terms used ...20

PART III

ENFORCEMENT, ETC. OF CONFISCATION ORDERS

8. Application of procedure for enforcing fines 24
9. Cases in which restraint orders and charging orders may be made 26
10................................Restraint orders 28
11.............Charging orders in respect of land, securities, etc . 30
12............................Realisation of property 32
13.............Application of proceeds of realisation and other sums 34
14..................Exercise of powers by High Court or receiver 36
15........................Variation of confiscation orders 38
16................................Bankruptcy of defendant, etc . .................... 38
17...............Winding up of company holding realisable property 40
18......Insolvency officers dealing with property subject to restraint order 42
19......................Receivers: supplementary provisions 44



1989 Ed.] Drug Trafficking (Recovery of Proceeds) 3




Section................................... Page

PART IV

INVESTIGATION INTO DRUG TRAFFICKING


20. Order to make material available .....46
21. Authority for search .................48
22. Supplementary provisions to sections 20 and 21 52
23, Disclosure of information held by public bodies 52
-24.......................................Offence of prejudicing investigation 56

PART V

MISCELLANEOUS

25.......................................Assisting another to retain the benefit of drug trafficking 58
26.......................................Restriction on revealing disclosure under section 25 60
27.......................................Compensation 62
28.......................................Enforcement of external orders 66
29.......................................Registration of external confiscation orders 66
30.......................................Evidence of corresponding law 68
31.......................................Amendment of Schedules 68

Schedule 1. Drug trafficking offences ...68
Schedule2. Assets on which a charging order may be imposed 70




1989 Ed.] Drug TRafficking (Recovery of Proceeds) 5




CHAPTER 405

DRUG TRAFFICKING (RECOVERY OF PROCEEDS)

To provide for the tracing, confiscation and recovery of the proceeds of drug
trafficking, to create the offence of assisting drug traffickers to retain those
proceeds, and for incidental or related matters.

[The Ordinance, except section
25(1), (2), (4) and (5) and
paragraph (a) of section 25(3)I-September 1989
Section 25(1), (2), (4) and (5) and
paragraph (a) of section 25(3)J13ecember19891L.N.297of1989

Originally 35 of 1989 -

PART I

PRELIMINARY

1. Short title

This Ordinance may be cited as the Drug Trafficking (Recovery of
Proceeds) Ordinance.

2. Interpretation

(1) In this Ordinance, unless the context otherwise requires-
,,authorized officer' ( ) means-
(a) any police officer;
(b)any member of the Customs and Excise Service established by
section 3 of the Customs and Excise Service Ordinance (Cap.
342); and
(c)any other person authorized in writing by the Attorney General
for the purposes of this Ordinance;
'confiscation order' means an order made under section 3(6);
'corresponding law' ( ) has the same meaning as in section 2(1) of the
Dangerous Drugs Ordinance (Cap. 134);
'dangerous drug' ( ) has the same meaning as in section 2(1) of the
Dangerous Drugs Ordinance (Cap. 134);
'defendant' ( ) means a person against whom proceedings have been
instituted for a drug trafficking offence (whether or not he has been
convicted of that offence);



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'drug trafficking-( ) means doing or being concerned in, whether in Hong
Kong or elsewhere, any act constituting-
(a)an offence specified in Schedule 1 (other than an offence under
section 25); or
(b) an offence punishable under a corresponding law,
and includes entering into or being otherwise concerned in, whether in
Hong Kong or elsewhere, an arrangement whereby-
(i)the retention or control by or on behalf of another person of that
other person's proceeds of drug trafficking is facilitated; or
(ii)the proceeds of drug trafficking by another person are used to
secure that funds are placed at that other person's disposal or are
used for that other person's benefit to acquire property by way of
investment;
'drug trafficking offence' means-
(a) any of the offences specified in Schedule 1;
(b) conspiracy to commit any of those offences;
(c) inciting another to commit any of those offences;
(d) attempting to commit any of those offences;
(e)aiding, abetting, counselling or procuring the commission of any
of those offences;
'interest' ( ), in relation to property, includes right;
'material' ( ) means any book, document or other record in any form
whatsoever, and any container or article relating thereto;
property' ( ) includes both movable and immovable property within the
meaning of section 3 of the Interpretation and General Clauses Ordinance
(Cap. 1);
'Registrar' ( ) means the Registrar of the Supreme Court.
(2) The expression listed in the left hand column below are respectively
defined or (as the case may be) fall to be construed in accordance with the
provisions of this Ordinance listed in the right hand column in relation to those
expressions.

Expression Relevant provision
Benefited from drug trafficking ...Section 3(4)
Charging order ....................Section 11(2)
Dealing with property....................................................... Section 10(8)
Gift caught by this Ordinance ) Section 7(9)
Making a gift (f~ M MAC) ..........Section 7(10)
Proceeds of drug trafficking () Section 4(1)(a)
Realisable property () ..Section 7(1)
Restraint order ...................Section 10(1)
Value of gift. payment or reward (, Section 7
Value of proceeds of drug trafficking Section 4(1)(b)
Value of property () ....Section 7(4)


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(3) This Ordinance applies to property whether it is situated in Hong
Kong or elsewhere.
(4) Reference in this Ordinance to offences include a reference to offences
committed before the commencement of this Ordinance; but nothing in this
Ordinance imposes any duty or confers any power on any court in or in
connection with proceedings against a person for a drug trafficking offence
instituted before the commencement of this Ordinance.
(5) References in this Ordinance to property received in connection with
drug trafficking include a reference to property received both in that connection
and in some other connection.
(6) Subsections (7) to (13) shall have effect for the interpretation of this
Ordinance.
(7) Property is held by any person if he holds any interest in it.
(8) References to property held by a person include a reference to
property vested in his trustee in bankruptcy or in a liquidator.
(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.
(10) Property is transferred by one person to another if the first person
transfers or grants to the other any interest in the property.
(11) Proceedings for an offence are instituted in Hong Kong-
(a)when a magistrate issues a warrant or summons under section 72
of the Magistrates Ordinance (Cap. 227) in respect of the offence;
(b)when a person is charged with the ofrence after being taken into
custody without a warrant; or
(c)when an indictment is preferred by the direction or with the
consent of a judge under section 24A(I)(b) of the Criminal
Procedure Ordinance (Cap. 221),
and where the application of this subsection would result in there being more
than one time for the institution of proceedings, they shall be taken to have
been instituted at the earliest of those times.
(12) Proceedings in Hong Kong for an offence are concluded on the
occurrence of one of the following events-
(a)the discontinuance of the proceedings whether by entry of a nolle
prosequi or otherwise;
(b)an order or verdict acquitting the defendant, not being an order
or verdict which is subject to appeal or review within the meaning
of subsection (13);
(c)the quashing of his conviction for the offence except where, under
section 83E of the Criminal Procedure Ordinance (Cap. 221), an
order is made that he be retried;




1989 Ed.] Drug Trafficking (Recovery of Proceeds) 11




(d)the grant of Her Majesty's pardon in respect of his conviction for
the offence;
(e)the court or magistrate sentencing or otherwise dealing with him
in respect of his conviction for the offence where the Attorney
General either does not apply for a confiscation order, or applies
for a confiscation order and the order is not made; or
(f) the satisfaction of a confiscation order made in the proceedings
(whether by payment of the amount due under the order or by
the defendant serving imprisonment in default).
(13) An order or verdict (including an order or verdict of acquittal) is
subject to appeal or review so long as an appeal, further appeal or review is
pending against the order or verdict; and for this purpose an appeal, further
appeal or review shall be treated as pending (where one is competent but has
not been instituted) until-
(a)in the case of an appeal to the Privy Council the expiration of 28
days after the date of the judgment from which leave to appeal
may be sought; or
(b)in any other case, the expiration of the time prescribed for
instituting the appeal, further appeal or review.
[cf. 1986 c. 32 s. 38 U.K.]

PART II

CONFISCATION OF PROCEEDS OF DRUG TRAFFiCKING

3. Confiscation orders

(1) Where-
(a)in proceedings before the High Court or the District Court a
person is to be sentenced in respect of one or more drug
trafficking offences and has not previously been sentenced in
respect of his conviction for the ofrence, or as the case may be,
any of the offences concerned; and
(b) an application is made by or on behalf of the Attorney General
for an order under this section,
the High Court or the District Court, as the case may be, shall act as follows.
(2) 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 (6),
as is appropriate in respect of the offence, or as the case may be, the offences
concerned.



1989 Ed.] Drug Trafficking (Recovery of Proceeds) 13




(3) The court shall then determine whether the person has benefited from
drug trafficking.
(4) For the purposes of this Ordinance, a person who has at any time
(whether before or after the commencement of this Ordinance) received any
payment or other reward in connection with drug trafficking carried on by him
or another has benefited from drug trafficking.
(5) If the court determines that he has so benefited, the court shall
determine in accordance with section 6 the amount to be recovered in his case
by virtue of this section.
(6) The court shall then, in respect of the offence or offences concerned-
(a) order him to pay that amount;
(b) take account of the order before-
(i) imposing any fine on him; or
(ii) making any order involving any payment by him; or
(iii) making any order under section 38F or 56 of the Dangerous
Drugs Ordinance (Cap. 134), or section 72, 84A, 102 or 103
of the Criminal Procedure Ordinance (Cap. 221).
(7) 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.
[cf. 1986 c. 32 s. 1 U.K.]

4. Assessing the proceeds of drug traflicking

(1) For the purposes of this Ordinance-
(a)any payments or other rewards received by a person at any time
(whether before or after the commencement of this Ordinance) in
connection with drug trafficking carried on by him or another are
his proceeds of drug trafficking; and
(b) the value of his proceeds of drug trafficking is the aggregate of
the values of the payments or other rewards.
(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.
(3) Those assumptions are-
(a) that any property appearing to the court-
(i) to have been held by him at any time since his conviction; or
(ii) to have been transferred to him at any time since the
beginning of the period of 6 years ending when the
proceedings were instituted against him,




1989 Ed.] Drug Trafficking (Recovery of Proceeds) 15




was received by him, at the earliest time at which he appears to
the court to have held it, as a payment or reward in connection
with drug trafficking carried on by him or another;
(b)that any expenditure of his since the beginning of that period was
met out of payments received by him in connection with drug
trafficking carried on by him or another; and
(c)that, for the purpose of valuing any property received or
assumed' to have been received by him at any time as such a
payment or reward, he received the property free of any other
interests in it.
(4) Subsections (2) and (3) do not apply if the only drug trafficking
offence in respect of which the defendant is to be sentenced is an offence under
section 25.
(5) For the purpose of assessing the value of the defendant's proceeds of
drug trafficking in a case where a confiscation order has previously been made
against him, the court shall leave out of account any of his proceeds of drug
trafficking that are shown to the court to have been taken into account in
determining the amount to be recovered under that order.
[cf. 1986 c. 32 s. 2 U.K.]

5. Statements relating to proceeds of drug trafficking

(1) Where-
(a)the prosecutor tenders to the High Court or the District Court, as
the case may be, a statement as to any matters relevant to the
determination whether the defendant has benefited from drug
trafficking or to the assessment of the value of his proceeds of
drug trafficking; and
(b)the defendant accepts to any extent any allegation in the
statement,
the court may, for the purposes of that determination and assessment, treat his
acceptance as conclusive of the matters to which the acceptance relates.
(2) Where-
(a) a statement is tendered under subsection (1)(a); and
(b)the court is satisfied that a copy of that statement has been served
on the defendant,
the court may require the defendant to indicate to what extent he accepts each
allegation in the statement and, so far as he does not accept any such allegation,
to indicate any matters he proposes to rely on.
(3) If the defendant fails in any respect to comply with a requirement
under subsection (2) he may be treated for the purposes of this section as
accepting every allegation in the statement apart from-




1989 Ed.] Drug Trafficking (Recovery of Proceeds) 17




(a)any allegation in respect of which he has compiled with the
requirement; and
(b)any allegation that he has benefited from drug trafficking or that-
any payment or other reward was received by him in connection
with drug trafficking carried on by him or another.
(4) Where-
(a)the defendant tenders to the court a statement as to any matters
relevant to determining the amount that might be realised at the
time the confiscation order is made; and
(b)the prosecutor accepts to any extent any allegation in the
statement,
the court may, for the purposes of that determination, treat the acceptance by
the prosecutor as conclusive of the matters to which the acceptance relates.
(5) An allegation may be accepted or a matter indicated for the purposes
of this section either-
(a) orally before the court; or
(b)in writing in accordance with rules of court or, in the absence of
such rules. in a form acceptable to the court.
(6) No acceptance by the defendant under this section that any payment
or other reward was received by him in connection with drug trafficking carried
on by him or another shall be admissible in evidence in any proceedings for an
offence.
[cf. 1986 c. 32 s. 3 U.K.]

6. Amount to be recovered under confiscation order

(1) Subject to subsection' (3), the amount to be recovered in the
defendant's case under the confiscation order shall be the amount the High
Court or the District Court, as the case may be, assesses to be the value of the
defendant's proceeds of drug trafficking.
(2) If the court is satisfied as to any matter relevant for determining the
amount that might be realised at -the time the confiscation order is made
(whether by an acceptance under section 5 or otherwise), the court may issue a
certificate giving the court's opinion as to the matters concerned and shall do so
if satisfied as mentioned in subsection (3).
(3) If the court is satisfied that the amount that might be realised at the
time the confiscation order is made is less than the amount the court assesses to
be the value of his proceeds of drug trafficking, the amount to be recovered in
the defendant's case under the confiscation order shall be the amount appearing
to the court to be the amount that might be so realised.
[cf. 1986 c. 32 s. 4 U.K.]



1989 Ed.] Drug Trafficking (Recovery of Proceeds) 19





7. Definition of principal terms used

(1) In this Ordinance, 'realisable property' ( ) means, subject to
subsection (2)-
(a) any property held by the defendant; and
(b)any property held by a person to whom the defendant has
directly or indirectly made a gift caught by this Ordinance.
(2) Property is not realisable property if-
(a)an order under section 102 or 103 of the Criminal Procedure
Ordinance (Cap. 221); or
(b)an order under section 38F or 56 of the Dangerous Drugs
Ordinance (Cap. 134),
is in force in respect of the property.
(3) For the purposes of sections 5 and 6 the amount that might be realised
at the time a confiscation order is made against the defendant is-
(a)the total of the values at that time of all the realisable property
held by the defendant, less
(b)where there are obligations having priority at that time, the total
amounts payable in pursuance of such obligations,
together with the total of the values at that time of all gifts caught by this
Ordinance.
(4) Subject to the following subsections, for the purposes of this
Ordinance the value of property (other than cash) in relation to any person
holding the property-
(a) where any other person holds an interest in the property, is-
(i) the market value of the first mentioned person's beneficial
interest in the property, less
(ii) the amount required to discharge any incumbrance (other
than a charging order) on that interest; and
(b) in any other case, is its market value.
(5) Subject to subsection (10), references in this Ordinance to the value at
any time (referred to in subsection (6) as 'the material time' (NJRIgf M1) ) of a
gift caught by this Ordinance or of any payment or reward are references to-
(a)the value of the gift, payment or reward to the recipient when he
received it adjusted to take account of subsequent changes in the
value of money; or
(b) where subsection (6) applies, the value there mentioned,
whichever is the greater.
(6) Subject to subsection (10), if at the material time the recipient holds-
(a) the property which he received (not being cash); or
(b)property which, in whole or in part, directly or indirectly
represents in his hands the property which he received,
the value referred to in subsection (5)(b) is the value to him at the material time
of the property mentioned in paragraph (a) or, as the case may be, of the




1989 Ed.] Drug Trafficking (Recovery of Proceeds) 21




property mentioned in paragraph (b) so far as it so represents the property
which he received, but disregarding in either case any charging order.
(7) For the purposes of subsection (3), an obligation has priority at any
time if it is an obligation of the defendant to-
(a)pay an amount due in respect of a fine, or other order of a court,
imposed or made on conviction of an offence, where the fine was
imposed or order made before the confiscation order; or
(b)pay any sum which, if the defendant had been adjudged bank-
rupt or was being wound up, would be among the preferential
debts.
(8) In subsection (7)(b) 'the preferential debts' ( )--
(a)in relation to bankruptcy, means the debts to be paid in priority
under section 38 of the Bankruptcy Ordinance (Cap. 6)
(assuming the date of the confiscation order to be the date of
filing of the petition and of the receiving order made under that
Ordinance); and
(b)in relation to winding up, means the debts to be paid under
section 265 of the Companies Ordinance (Cap. 32) (assuming the
date of the confiscation order to be the date of commencement of
the winding up and the relevant date for the purpose of that
section).
(9) A gift (including a gift made before the commencement of this
Ordinance) is caught by this Ordinance if-
(a)it was made by the defendant at any time since the beginning of
the period of 6 years ending when the proceedings were instituted
against him; or
(b)it was made by the defendant at any time and was a gift of
property-
(i)received by the defendant in connection with drug trafficking
carried on by him or another; or
(ii) which in whole or in part directly or indirectly represented in
the defendant's hands property received by him in that
connection.
(10) For the purposes of this Ordinance-
(a)the circumstances in which the defendant is to be treated as
making a gift include those where he transfers property to
another person directly or indirectly for a consideration the value
of which is significantly less than the value of the consideration
provided by the defendant; and
(b)in those circumstances, the preceding provisions of this section
shall apply as if the defendant had made a gift of such share in
the property as bears to the whole property the same proportion


1989 Ed.] Drug Trafficking (Recovery of Proceeds) 23





as the difference between the values referred to in paragraph (a) bears to the
value of the consideration provided by the defendant.
[cf. 1986 c. 32 s. 5 U.K.]

PART III

ENFORCEMENT, ETC. OF CONFISCATION ORDERS

8. Application of procedure for enforcing fines
(1) Subject to this section, where the High Court or the District Court, as
the case may be, orders the defendant to pay any amount under section 3-
(a)the court shall make an order fixing a term of imprisonment
which he is to serve if any of the amount which he is liable to pay
is not duly paid or recovered; and
(b)section 114(1), (3), (4), (5), (6) and (7) of the Criminal Procedure
Ordinance (Cap. 22 1) shall apply as if-
(i) that amount were a fine imposed upon him by the court; and
(ii) the term of imprisonment fixed under this section were a
term fixed under section 1 14(1)(c) of that Ordinance.
(2) The terms set out in the second column of the following table shall be
the maximum terms of imprisonment under subsection (1) applicable
respectively to the amounts set out opposite thereto.
TABLE
An amount not exceeding $200,000 ....12 months
An amount exceeding $200,000 but not exceeding $500,000 18 months
An amount exceeding $500,000 but not exceeding $1 million 2 years
An amount exceeding $1 million but not exceeding $2.5 million 3 years
An amount exceeding $2.5 million but not exceeding $10 million 5 years
An amount exceeding $ 10 million .....10 years
(3) Subsections (1) and (2) shall apply in relation to the District Court
notwithstanding any limitation on the jurisdiction of that court as to the
imposition of penalties set out in section 82 of the District Court Ordinance
(Cap. 336).
(4) 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).
(5) For the purposes of subsection (4)-




1989 Ed.] Drug Trafficking (Recovery of Proceeds) 25




(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 efrect
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.
(6) Section 109A of the Criminal Procedure Ordinance (Cap. 221) shall
not apply in relation to fixing a term of imprisonment under this section.
[cf. 1986 c. 32 s. 6 U.K.]

9. Cases in which restraint orders and
charging orders may be made

(1) The powers conferred on the High Court by sections 10(1) and 11 (1)
are exercisable where-
(a)proceedings have been instituted in Hong Kong against the
defendant for a drug trafficking offence;
(b) the proceedings have not been concluded; and
(c)the High Court is satisfied that there is reasonable cause to
believe that the defendant has benefited from drug trafficking.
(2) Those powers are also exercisable where the High Court is satisfied-
(a)that whether by the laying of an information or otherwise, a
person is to be charged in Hong Kong with a drug trafficking
ofrence; and
(b)that there is reasonable cause to believe that he has benefited
from drug trafficking.
(3) For the purposes of sections 10 and 11, in relation to the exercise of
those powers at any time before proceedings have been instituted-
(a)-references in this Ordinance to the defendant shall be construed
as references to the person referred to in subsection (2)(a);
(b)references in this Ordinance to the prosecutor shall be construed
as references to the person who the High Court is satisfied is to
have the conduct of the case for the prosecution in the proposed
proceedings; and
(c)references in this Ordinance to realisable property shall be
construed as if, immediately before that time, proceedings had
been instituted against the person referred to in subsection (2)(a)
for a drug trafficking ofrence.




1989 Ed.] Drug Trafficking (Recovery of Proceeds) 27




(4) Where the High Court has made an order under section10(1) or 11(1)
by virtue of subsection (2), the High Court shall discharge the order if
proceedings in respect of the offence are not instituted within such'time as the
High Court considers reasonable.
[cf. 1986 c. 32 s. 7 U.K.]

10. Restraint orders

(1) The High Court may by order (in this Ordinance referred to as
a 'restraint order'prohibit any person from dealing with any
realisable property, subject to such conditions and exceptions as may be
specified in the order.
(2) A restraint order may apply-
(a)to all realisable property held-by a specified person, whether the
property is described in the order or not; and
(b)to realisable property held by a specified person, being property
transferred to him after the making of the order.
(3) This section shall not have effect in relation to any property for the
time being subject to a charge under section 11.
(4) A restraint order-
(a) may be made only on an application by the prosecutor;
(b)may be made on an ex parte application to a judge in chambers;
and
(c)shall provide for notice to be given to persons affected by the
order.
(5) A restraint order-
(a) may be discharged or varied in relation to any property; and
(b)shall be discharged when proceedings for the offence are
concluded.
(6) An application for the discharge or variation of a restraint order may
be made by any person affected by it.
(7) Where the High Court has made a restraint order, the High Court
may at any time appoint a receiver- -
(a) to take possession of any realisable property; and
(b)in accordance with the High Court's directions, to manage or
otherwise deal with any property in respect -of which he is
appointed,
subject to such exceptions and conditions as may be specified by the High
Court; and may require any person having possession of property in respect of
which a receiver is appointed under this section to give possession of it to the
receiver.
(8) For the purposes of this section, dealing with property held by any
person includes (without prejudice to the generality of the expression)-




1989 Ed.] Drug Trafficking (Recovery of Proceeds) 29





(a)where the property is a debt owed to that person, making a
payment to any person in reduction or full settlement of the
amount of the debt;
(b) making or receiving a gift of the property; and
(c) removing the property from Hong Kong.
(9) Where the High Court has made a restraint order, an authorized
officer may, for the purpose of preventing any realisable property being
removed from Hong Kong, seize the property.
(10) Property seized under subsection (9) shall bedealt with in accordance
with the High Court's directions.
(11) Where any property specified in a restraint order is immovable
property the order shall, for the purposes of the Land Registration Ordinance
(Cap. 128)-
(a) be deemed to be an instrument affecting land; and
(b)be registrable as such in the Land Office under that Ordinance in
such manner as the Land Officer thinks fit.
[cf. 1986 c. 32 s. 8 U.K.]

11. Charging orders in respect of land, securities, etc.
(1) The High Court may make a charging order on realisable property for
securing the payment to the Government-
(a)where a confiscation order has not been made, of an amount
equal to the value from time to time of the property charged; and
(b)in any other case, of an amount not exceeding the amount
payable under the confiscation order.
(2) For the purposes of this Ordinance, a charging order is an order made
under this section imposing on any such realisable property as may be specified
in the order a charge for securing the payment of money to the Government.
(3) A charging order-
(a) may be made only on an application by the prosecutor;
(b) may be made on an ex parte application to ajudge in chambers;
(c)shall provide for notice to be given to persons afrected by the
order; and
(d)may be made subject to such conditions as the High Court thinks
fit and, without prejudice to the generality of this paragraph,
such conditions as it thinks fit as to the time when the charge is to
become effective.
(4) Subject to subsection (6), a charge may be imposed by a charging
order only on-
(a)any interest in realisable property, being an interest held
beneficially by the defendant or by a person to whom the
defendant has directly or indirectly made a gift caught by this
Ordinance-



1989 Ed.] Drug Trafficking (Recovery of Proceeds) 31




(i) in any asset of a kind specified in Schedule 2; or
(ii) under any trust; or
(b)any interest in realisable property held by a person as trustee of a
trust if the interest is in such an asset or is an interest under
another trust and.a charge may by virtue of paragraph (a) be
imposed by a charging order on the whole beneficial interest
under the first mentioned trust.
(5) In any case where a charge is imposed by a charging order on any
interest in an asset of a kind specified in Schedule 2, the High Court may
provide for the charge to extend to any interest, dividend or other distribution
payable and any bonus issue in respect of the asset.
(6) The High Court may make an order discharging or varying the
charging order and shall make an order discharging the charging order if the
proceedings for the offence are concluded or the amount payment of which is
secured by the charge is paid into the High Court.
1 (7) An application for the discharge or variation of a charging order may
be made by any person affected by it.
(8) Subject to the provisions of this Ordinance, a charge imposed by a
charging order shall have the like effect and shall be enforceable in the same
manner as an equitable charge created by the person holding the beneficial
interest or, as the case may be, the trustee, by writing under his hand.
[cf. 1986 c. 32 s. 9 U.K.]

12. Realisation of property
(1) Where-
(a)in proceedings instituted for a drug trafficking offence, a
confiscation order is made;
(b)the order is not subject to appeal or review within the meaning of
section 2(13); and
(c) the proceedings have not been concluded,
the High Co - urt may, on an application by the prosecutor, exercise the powers
conferred by subsections (2) to (6).
(2) The High Court may appoint a receiver in respect of realisable
property.
(3) The High Court may empower a receiver appointed under subsection
(2), under section 10 or in pursuance of a charging order-
(a)to enforce any charge imposed under section 11 on realisable
property or on any interest, dividend or other distribution
payable and any bonus issue in respect of such property; and
(b)in relation to any realisable property other than property for
the time being subject to a charge under section 11, to take
possession of the property subject to such conditions or
exceptions as may be specified by the High Court.




1989 Ed.] Drug Trafficking (Recovery of Proceeds) 33




(4) The High Court may order any person having possession of realisable
property to give possession of it to any such receiver.
(5) The High Court may empower any such receiver to realise any
realisable property in such manner as the High Court may direct.
(6) The High Court may order any person holding an interest in realisable
property to make such payment to the receiver in respect of any beneficial
interest held by the defendant or, as the case may be, the recipient of a gift
caught by this Ordinance as the High Court may direct and the High Court
may, on the payment being made, by order transfer, grant or extinguish any
interest in the property.
(7) Subsections (4) to (6) do not apply to property for the time being
subject to a charge under section 11.
(8) The High Court shall not in respect of any property exercise the
powers conferred by subsection *(3)(a), (5) or (6) unless a reasonable
opportunity has been given for persons holding any interest in the property to
make representations to the High Court.
[cf. 1986 c. 32 s. 11 U.K.]

13. Application of proceeds of realisation and other sums

(1) Subject to subsection (2), the following sums in the hands of a receiver
appointed under section 10 or 12 or in pursuance of a charging order, that is-
(a)the proceeds of the enforcement of any charge imposed under
section 11; -
(b)the proceeds of the realisation, other than by the enforcement of
such a charge, of any property under section 10 or 12; and
(c) any other sums, being property held by the defendant,
shall 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
such payments (if any) as the High Court may direct have been made out of
those sums-
(i) be payable to the Registrar; and
(ii) be applied on the defendant's behalf towards the satisfaction of
the confiscation order in the manner provided by subsection (3).
(2) If, after the amount payable under the confiscation order has been
fully paid, any such sums remain in the hands of such a receiver, the receiver
shall distribute those sums-
(a)among such of those who held property which has been realised
under this Ordinance; and
(b) in such proportions,
as the High Court may direct after giving a reasonable opportunity for such
persons to make representations to the High Court.



1989 ed.] Drug Trafficking (Recovery of Proceeds) 35




(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 required 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.
[cf. 1986 c. 32 s. 12 U.K.]

14. Exercise of powers by High Court or receiver
(1) The following subsections apply to the powers conferred on the High
Court by sections 10 to 13, or on a receiver appointed under section 10 or 12 or
in pursuance of a charging order.
(2) Subject to subsections (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 realisable property held by any
person by the realisation of such property.
(3) In the case of realisable property held by a person to whom the
defendant has directly or indirectly made a gift caught by this Ordinance, the
powers shall be exercised with a view to realising no more than the value for the
time being of the gift.
(4) The powers shall be exercised with a view to allowing any person
other than the defendant or the recipient of any such gift to retain or recover
the value of any property held by him.
(5) An order may be made or other action taken in respect of a debt owed
by the Government.
(6) In exercising those powers, no account shall be taken of any
obligations of the defendant or of the recipient of any such gift which conflict
with the obligation to satisfy the confiscation order.
[cf. 1986 c. 32 s. 13 U.K.]



1989 Ed.] Drug Trafficking (Recovery of Proceeds) 37




15. Variation of confiscation orders
(1) If, on an application by the defendant -in respect of a confiscation
order, the High Court is satisfied that the realisable property is inadequate for
the payment of any amount remaining to be recovered under the confiscation
order, the High Court shall make an order-
(a)substituting for the amount to be recovered under the
confiscation. order such lesser amount as the High Court thinks
just in all the circumstances of the case; and
(b)substituting f6r the term of imprisonment fixed under section 8 in
respect of the amount to be recovered under the confiscation
order a shorter term determined in accordance with that section
in respect of the lesser amount.
(2) For the purposes of subsection (1)--
(a)in the case of realisable property held by a person who has been
adjudged bankrupt or whose estate has been sequestrated the
High Court shall take into account the extent to which any
property held by him may be distributed among creditors; and
(b)the High Court may disregard any inadequacy in the realisable
property which appears to the High Court to be attributable
wholly or partly to anything done by the defendant for the
purpose of preserving any property, held by a person to whom the
defendant had directly or indirectly made a gift caught by this
Ordinance from any risk of realisation under this Ordinance.
[cf. 1986 c. 32 s. 14 U.K.]

16. Bankruptcy of defendant, etc.
(1) Where a person who holds realisable property is adjudged bankrupt-
(a)property for the time being subject to a restraint order made
before the order adjudging him bankrupt; and
(b)any proceeds of property realised by virtue of section 10(7) or
12(5) or (6) for the time being in the hands of a receiver
appointed under section 10 or 12,
are excluded from the property of the bankrupt 'for the purposes of the
Bankruptcy Ordinance (Cap. 6).
(2) Where a person has been adjudged bankrupt, the powers conferred on
the High Court by sections 10 to 13 shall not be exercised in relation to-
(a)property for the time being comprised in the property of the
bankrupt for the purposes of the Bankruptcy Ordinance (Cap. 6);
and
(b)property which is to be applied for the benefit of creditors of the
bankrupt by virtue of a condition imposed under section 30(3) of
the Bankruptcy Ordinance (Cap. 6).


1989 Ed.] Drug Trafficking (Recovery of Proceeds) 39




(3) Nothing in the Bankruptcy Ordinance (Cap. 6) shall be taken as
restricting, or enabling the restriction of, the exercise of the powers conferred
on the High Court by sections 10 to 13.
(4) Subsection (2) does not affect the enforcement of a charging order-
(a) made before the order adjudging the person bankrupt; or
(b)on property which was subject to a restraint order when the order
adjudging him bankrupt was made.
(5) Where, in the case of a debtor, an interim receiver stands appointed
under section 13 of the Bankruptcy Ordinance (Cap. 6) and any property of the
debtor is subject to a restraint order, the powers conferred on the interim
receiver by virtue of that Ordinance do not apply to property for the time being
subject to the restraint order.
(6) Where a person is adjudged bankrupt and has directly or indirectly
made a gift caught by this Ordinance-
(a) a court shall not make an order under-'
(i) section 31, 47 or 49 of the Bankruptcy Ordinance (Cap. 6);
or
(ii)section 60 of the Conveyancing and Property Ordinance
(Cap. 219),
in respect of the making of the gift at any time when proceedings
for a drug trafficking ofrence have been instituted against him
and have not been concluded or when property of the person to
whom the gift was made is subject to a restraint order or charging
order; and
(b)any order made under any of those sections after the conclusion
of the proceedings shall take into account any realisation under
this Ordinance of property held by the person towhom the gift
was made.
[cf. 1986 c. 32 s. 15 U.K.]

17. Winding up of company holding realisable property

(1) Where realisable property is held by a company and an order for the
winding up of the company has been made or a resolution has been passed by
the company for voluntary winding up, the functions of the liquidator (or any
provisional liquidator) shall not be exercisable in relation to-
(a)property for the time being subject to a restraint order made
before the relevant time; and
(b)any proceeds of property realised by virtue of section 10(7) or
12(5) or (6) for the time being in the hands of a receiver
appointed under section 10 or. 12.
(2) Where, in the case of a company, such an order has been made or such
a resolution has been passed, the powers conferred on the High Court by




1989 Ed.] Drug Trafficking (Recovery of Proceeds) 41




sections 10 to 13 shall not be exercised in relation to any realisable property
held by the company in relation to which the functions of the liquidator are
exercisable-
(a) so as to inhibit him from exercising those functions for the
purpose of distributing any property held by the company to the
company's creditors; or
(b)so as to prevent the payment out of any property of expenses
(including the remuneration of the liquidator or any provisional
liquidator) properly incurred in the winding up in respect of the
property.
(3) Nothing in the Companies Ordinance (Cap. 32) shall be taken as
restricting, or enabling the restriction of, the exercise of the powers conferred
on the High Court by sections 10 to 13.
(4) Subsection (2) does not affect the enforcement of a charging order
made before the relevant time or on property which was subject to a restraint
order at the relevant time.
(5) In this section-
'company' ( ) means any company which may be wound up under the
Companies Ordinance (Cap. 32); and
'the relevant time' ( ) means-
(a)where no order for the winding up of the company has been
made, the time of the passing of the resolution for voluntary
winding up;
(b)where such an order has been made and, before the presentation
of the petition for the winding up of the company by the High
Court, such a resolution had been passed by the company, the
time of the passing of the resolution; and
(c)in any other case where such an order has been made, the time of
the making of the order.
[cf. 1986 c. 32 s. 17 U.K.]

18. Insolvency officers dealing with property
subject to restraint order
(1) Without prejudice to the generality of any provision contained in the
Bankruptcy Ordinance (Cap. 6), the Companies Ordinance (Cap. 32) or any
other Ordinance, where-
(a)any insolvency officer seizes or disposes of any property in
relation to which his functions are not exercisable because it is for
the time being subject to a restraint order; and
(b)at the time of the seizure or disposal he believes, and has
reasonable grounds for believing, that he is entitled (whether in
pursuance of an order of a court or otherwise) to seize or dispose
of that property,



1989 Ed.] Drug Trafficing (Recovery of Proceeds) 43




he shall not be liable to any other person in respect of any loss or damage
resulting from the seizure or disposal except in so far as the loss or damage is
caused by his negligence; and the insolvency officer shall have a lien on the
property, or the proceeds of its sale, for such of his expenses as were incurred in
connection with the liquidation, bankruptcy or other proceedings in relation to
which the seizure-or disposal purported to take place and for so much of his
remuneration as may reasonably be assigned for his acting in connection with
those proceedings.
(2) Any insolvency officer who incurs expenses-
(a)in respect of such property as is mentioned in subsection (1)(a)
and in so doing does not know and has no reasonable grounds to
believe that the property is for the time being subject to a
restraint order; or
(b)other than in respect of such property as is so mentioned, being
expenses which, but for the effect of a restraint order, might have
been met by taking possession of and realising the property,
shall be entitled (whether or not he has seized or disposed of that property so as
to have a lien under that subsection) to payment of those expenses under
section 13(1) or (3).
(3) In this section 'insolvency officer' ( ) means-
(a) the Official Receiver; or
(b) any person acting as-
(i) a receiver, interim receiver, special manager or trustee
appointed under the Bankruptcy Ordinance (Cap. 6); or
(ii)a liquidator, provisional liquidator or special manager
appointed under the Companies Ordinance (Cap. 32).
[cf. 1986 c. 32 s. ]7A U.K.]

19. Receivers: supplementary provisions
(1) Where a receiver appointed under section 10 or 12 or in pursuance of
a charging order takes any action-
(a)in relation to property which is not realisable property, being
action which he would be entitled to take if it were such property;
(b)believing, and having reasonable grounds for believing, that he is
entitled to take that action in relation to that property,
he shall not be liable to any person in respect of any loss or damage resulting
from his action except in so far as the loss or damagd is caused by his negligence.
(2) Any amount due in respect of the remuneration and expenses of a
receiver so appointed shall, if no sum is available to be applied in payment of it
under section 13(3), be paid by the prosecutor or, in a case where proceedings
for a drug trafficking offence are not instituted, by the person on whose
application the receiver was appointed.
[cf. 1986 c. 32 s. 18 U.K.]



1989 Ed.] DRug Trafficking (Recovery of Proceeds) 45




PART IV

INVESTIGATIONS INTO DRuG TRAFFICKING

20. Order to make material available

(1) An authorized officer may, for the purpose of an investigation into
drug trafficking, apply to a court for an order under subsection (2) in relation to
particular material or material of a particular description.
(2) Subject to section 23(10), the court may, if on such an application it is
satisfied that the conditions in subsection (4) are fulfilled, make an order that
the person who appears to the court to be in possession of the material to which
the application relates shall-
(a)produce the material to an authorized officer for him to take
away; or
(b) give an authorized officer access to it,
within such period as the order may specify.
(3) The period to be specified in an order under subsection (2) shall be 7
days unless it appears to the court that a longer or shorter period would be
appropriate in the particular circumstances of the application.
(4) The conditions referred to in subsection (2) are-
(a)that there are reasonable grounds for suspecting that a specified
person has carried on or has benefited from drug trafficking;
(b)that there are reasonable grounds for believing that the material
to which the application relates-
(i) is likely to be of substantial value (whether by itself or
together with other material) to the investigation for the
purpose of which the application is made; and
(ii) does not consist of or include items subject to legal privilege;
- and
(c)that there are reasonable grounds for believing that it is in the
public interest, having regard-
(i) to the benefit likely to accrue to the investigation if the
material is obtained; and
(ii)to the circumstances under which the person in possession of
the material holds it,
that the material should be produced or that access to it should
be given.
(5) Where a court makes an order under subsection (2)(b) in relation to
material on any premises it may, on the same or a subsequent application of an
authorized officer, order any person who appears to him to be entitled to grant
entry to the premises to allow an authorized officer to enter the premises to
obtain access to the material.



1989 Ed.] Drug Trafficking (Recovery of Proceeds) 47




(6) Rules of court may provide for-
(a) the discharge and variation of orders under this section; and
(b). proceedings relating to such orders.
(7) Where the material to which an application under this section relates
consists of information contained in or accessible by means of any data
equipment-
(a)an order under subsection 2(a) shall have efflect as an order to
produce the material in a form in which it can be taken away and
in which it is visible and legible; and
(b)an order under subsection 2(b) shall have effect as an order to
give access to the material in a form in which it is visible and
legible.
(8) In subsection (7), 'data equipment- ( ) means any equipment
which-
(a) automatically processes information;
(b) automatically records or stores information;
(c)can be used to cause information to be automatically recorded,
stored or otherwise processed on other equipment (wherever
situated);
(d)can be used to retrieve information, whether the information is
recorded or stored in the equipment itself or in other equipment
(wherever situated).
(9) An order under subsection (2)-
(a)shall not confer any right to production of, or access to, items
subject to legal privilege;
(b)shall have effect notwithstanding any obligation as to secrecy or
other restriction upon the disclosure of information imposed by
statute or otherwise; and
(c)may be made in relation to material in the possession of a public
body as defined in section 23.
[cf. 1986 c. 32 s. 27 U.K.]

21. Authority for search

(1) An authorized officer may, for the purpose of an investigation into
drug trafficking, apply to a court for a warrant under this section in relation to
specified premises.
(2) On such application the court may issue a warrant authorizing an
authorized officer to enter and search the premises if it is satisfied-
(a)that an order made under section 20 in relation to material on the
premises has not been complied with; or
(b) that the conditions in subsection (3) are fulfilled; or
(c) that the conditions in subsection (4) are fulfilled.


1989 Ed.] Drug Trafficking (Recovery of Proceeds) 49




(3) The conditions referred to in subsection (2)(b) are-
(a)that there are reasonable grounds for suspecting that a specified
person has carried on or has benefited. from drug trafficking; and
(b)that the conditions in section 20(4)(b) and (e) are fulfilled in
relation to any material on the premises; and
(c)that it would not be appropriate to make ' an order under that
section in relation to the material because-
(i) it is not practicable to communicate with any person entitled
to produce the material; or
(ii) it is not practicable to communicate with any person entitled
to grant access to the material or entitled to grant entry to
the premises on which the material is situated; or
(iii) the investigation for the purposes of which the application is
made might be seriously prejudiced unless an authorized
officer could secure immediate access to the material.
(4) The conditions referred to in subsection (2)(c) are-
(a)that there are reasonable grounds for suspecting that a specified
person has carried on or has benefited from drug trafficking; and
(b)that there are reasonable grounds for suspecting that there is on
the premises material relating to the specified person or to drug
trafficking which is likely to be of substantial value (whether by
itself or together with other material) to the investigation for the
purpose of which the application is made, but that the material
cannot at the time of the application be particularized;. and
(c) that-
(i) it is not practicable to communicate with any person entitled
to grant entry to the premises; or
(ii) entry to the premises will not be granted unless a warrant is
produced;or
(iii) the investigation for the purposes of which the application is
made might be seriously prejudiced unless an authorized
officer arriving at the premises could secure immediate entry
to them.
(5) Where an authorized officer has entered premises in the execution of a
warrant issued under this section, he may seize and retain any material, other
than items subject to legal privilege, which is likely to be of substantial value
(whether by itself or together with other material) to the investigation for the
purpose of which the warrant was issued..
(6) Any person who hinders or obstructs an authorized officer in the
execution of a warrant issued under this section commits an offence and is
liable-
(a)on conviction upon indictment to a fine of $250,000 and to
imprisonment for 2 years; or



1989 Ed.] Drug Trafficking (Recovery of Proceeds) 51




(b) on summary conviction to a fine of $50,000 and to imprisonment
for 6 months.
[cf.1986 c. 32 s. 28 U.K.]

22. Supplementary provisions to sections 20 and 21

(1) An authorized officer may photograph or make copies of any
material-
(a) produced or to which access is given under section 20; or
(b) seized under section 21.
(2) In sections 20 and 21-
court' ( ) means the High Court and the District Court.,
'items subject to legal privilege' ( ) means-
(a) communications between a professional legal adviser and his
client or any person representing his client made in connection
with ' the giving of legal advice to the client;
(b)communications between a professional legal adviser and his
client or any person representing his client or between such an
adviser or his client or any such representative and any other
person made in connection with or in contemplation of legal
proceedings and for the purposes of such proceedings; and
(c)items enclosed with or referred to in such communications and

(i) in connection with the giving of legal advice. or
(ii) in connection with or in contemplation of legal proceedings
and for the purposes of such proceedings,
when they are in the possession of a person who is entitled to
possession of them, but excluding, in any case, any communi-
cations or item held with the intention of furthering a criminal
purpose;
premises' ( ) includes any place and, in particular, includes-
(a) any vehicle, vessel, aircraft, hovercraft or offshore structure; and
(b) any tent or movable structure.
[cf. 1986 c. 32 s. 29 U.K.]

23. Disclosure of information held by public bodies

(1) Subject to subsection (4), the High Court may, on an application by
the prosecutor, order any material mentioned in subsection (3) which is in the
possession of a public body to be produced to the High Court within such
period as the High Court may specify.




1989 Ed.] Drug Trafficking (Recovery of Proceeds) 53




(2) The power to make an order under subsection (1) is exercisable if-
(a) the powers conferred on the High Court by sections 10(1) and
11 (1) are exercisable by virtue of section 9(1); or 1
(b)those powers are exercisable by virtue of section 9(2) and the
High Court has made a restraint or charging order which has not
been discharged,
but where the power to make an order under subsection (1) is exercisable by
virtue only of paragraph (b), section 9(3) shall apply for the purposes of this
section as it applies for the purposes of sections 10 and 11.
(3) The material referred to in subsection (1) is any material which-
(a)has been submitted to an officer of a public body by the
defendant or by a person who has at any time held property
which was realisable property;
(b)has been made by an officer of a public body in relation to the
defendant or ^such a person; or '
(c)is correspondence which passed between an officer of a public
body and the defendant or such a person,
and an order under that subsection may require the production of all such
material or of a particular description of such material, being material in the
possession of the body concemed.
(4) An order under subsection (1) shall not require the production of any
material unless it appears to the High Court that the material is likely to
contain information that would facilitate the. exercise of the powers conferred
on the High Court by sections 10 to 12 or on a receiver appointed under section
10 or 12 or in pursuance of a charging order.
(5) The High Court may by order authorize the disclosure to such a
receiver of any material produced under subsection (1) or any part of such
material; but the High Court shall not make an order under this subsection
unless a reasonable opportunity has been given for an officer of the public body
to make representations to the High Court.
(6) Material disclosed in pursuance of an order under subsection'(5) may,
subject to any conditions contained in the order, be further disclosed for the
purposes of the functions under this Ordinance of the receiver or the High
Court.
(7) The High Court may by order authorize the disclosure to an
authorized officer of any material produced under subsection (1) or any part of
such material; but the High Court shall not make an order under this
subsection unless-
(a)a reasonable opportunity has been given for an officer of the
public body to make representations to the High Court; and



1989 Ed.] Drug Trafficking (Recovery of Proceeds) 55




(b)it appears to the High Court that the material is likely to be
of substantial value in exercising functions relating to drug
trafficking.
(8) Material disclosed in pursuance of an order under subsection (7) may,
subject to any conditions contained in the order, be further disclosed for the
purposes of functions relating to drug trafficking.
(9) Material may be produced or disclosed inpursuance of this section
notwithstanding any obligation as to secrecy or other restriction upon the
disclosure of information imposed by statute or otherwise.
(10) An order under subsection (1) and, in the case of material in the
possession of a public body, an order under section 20(2) may require any
officer of the public body (whether named in the order or not) who may for the
time being be in possession of the material concerned to comply with it, and
such an order shall be served as if the proceedings were civil proceedings against
the Crown.
(11) In this section 'public body' means-
(a) any Government department; and
(b) anybody specified by the Governor under subsection (12).
(12) The Governor may, by notice in the Gazette, specify a body to be a
public body for the purposes of this section.
[cf. 1986 c. 32 s. 30 U.K.]

24. Offence of prejudicing investigation

(1) Where, in relation to an investigation into drug trafficking, an order
under section 20 has been made or has been applied for and has not been
refused or a warrant under section 21 has been issued, a person who, knowing
or suspecting that the investigation is taking place, makes any disclosure which
is likely to prejudice the investigation commits an offence.
(2) In proceedings against a person for an offence under this section, it is
a defence to prove-
(a)that he did not know or suspect that the disclosure was likely to
prejudice the investigation; or
(b)that he had lawful authority or reasonable excuse for making the
disclosure.
(3) A person who commits an offence under this section is liable-
(a)on conviction upon indictment to a fine of $500,000 and to
imprisonment for 3 years; or
(b)on summary conviction to a fine of $100,000 and to
imprisonment for 1 year.
[cf. 1986 c. 32 s. 31 U.K.]




1989 Ed.] Drug Trafficking (Recovery of Proceeds) 57




PART V

MISCELLANEOUS

25. Assisting another to retain the
benefit of drug trafficking
(1) Subject to subsection (3), a person who enters into or is otherwise
concerned in an arrangement whereby-
(a)the retention or control by or on behalf of another ('the relevant
person' ( ) of the relevant person's proceeds of drug
trafficking is facilitated (whether by concealment, removal from
the jurisdiction, transfer to nominees or otherwise); or
(b) the relevant person's proceeds of drug trafficking-
(i) are used to secure that funds are placed at the relevant
person's disposal; or
(ii) are used for the relevant person's benefit to acquire property
by way of investment,
knowing or having reasonable grounds to believe that the relevant person is a
person who carries on or has carried on drug trafficking or has benefited from
drug trafficking, commits an offence.
(2) In this section, references to any person's proceeds of drug trafficking
include a reference to any property which in whole or in part directly or
indirectly represented in his hands his proceeds of drug trafficking.
(3) Where a person discloses to an authorized officer a suspicion or belief
that any funds or investments are derived from or used in connection with drug
trafficking or'any matter on which such a suspicion or belief is based-
(a)if he does any act in contravention of subsection (1) and the
disclosure relates to the arrangement concerned, he does not
commit an offence under this section if the disclosure is made in
accordance with this paragraph, that is-
(i) it is made before he does the act concerned, being an act
done with the consent of the authorized officer; or
(ii) it is made after he does the act, but is made on his initiative
and as soon as it is reasonable for him to make it;
(b)the disclosure shall not be treated as a breach of any restriction
upon the disclosure of information imposed by contract or by
rules of professional conduct; and
(c) he shall not be liable in damages for any loss arising out of-
(i) the disclosure;
(ii)any act done or omitted to be done in relation to the funds
or investments in consequence of the disclosure.
(4) In proceedings against a person for an offence under this section, it is
a defence to prove-



1989 Ed.] Drug Trafficking (Recovery of Proceeds) 59




(a)that he did not know or suspect that the arrangement related to
any person's proceeds of drug trafficking; or
(b)that he did not know or suspect that by the arrangement the
retention or control by or on behalf of the relevant person of any
property was facilitated or, as the case may be, that by the
arrangement any property was used as mentioned in subsection
(1); or
(c) that-
(i) he intended to disclose to an authorized officer such a
suspicion, belief or matter as is mentioned in subsection (3)
in relation to the arrangement; but
(ii) there is reasonable excuse for his failure to make disclosure
in accordance with subsection (3)(a).
(5) A person who commits an offence under this section is liable-
(a)on conviction upon indictment to a fine of $5,000,000 and to
imprisonment for 14 years; or
(b)on summary conviction to a fine of $500,000 and to
imprisonment for 3 years.
[cf. 1986 e. 32 s. 24 U.K.]

26. Restriction on revealing disclosure under section 25

(1). Subject to subsection (2), no witness in any civil or criminal
proceedings shall be obliged-
(a) to reveal that a disclosure was made under section 25(3);
(b)to reveal the identity of any person as the person making the
disclosure; or
(c)to answer any question if the answer would lead, or would tend
to lead, to the revealing of any fact or matter referred to in
paragraph (a) or (b).
(2) Subsection (1) shall not apply in any proceedings-
(a) for an offence under section 25 or this section; or
(b)where the court is ofthe opinion that justice cannot fully be done
between the parties without revealing the disclosure or the
identity of any person as the person making the disclosure.
(3) Subject to subsections (4), (5) and (6), no person shall publish or
broadcast any information so as to reveal or suggest-
(a) that a disclosure was made under section 25(3); or
(b) the identity of any person as the person making the disclosure.
(4) In subsection (3) 'information' ( )-
(a) includes a report of any civil or criminal proceedings;
(b)does not include information published for statistical purposes
by, or under the authority of, the Government.




1989 Ed.] Drug Trafficking (Recovery of Proceeds) 61




(5) Subsection (3) shall not apply in respect of proceedings-
(a)against the person making the disclosure for an offence under
section 25; or
(b) for an offence under this section.
(6) The court or a magistrate may, if satisfied that it is in the interests of
justice to do so, by order dispense with the requirements of subsection (3) to
such extent as may be specified in the order.
(7) If information is published or broadcast in contravention of
subsection (3), each of the following persons-
(a)in the case of publication as part of a newspaper or periodical
publication, any proprietor, editor, publisher and distributor
thereof;
(b)in the case of a publication otherwise than as part of a newspaper
or periodical publication, any person who publishes it and any
person who distributes it;
(c)in the case of a broadcast, any person who broadcasts the
information and, if the information is contained in a programme,
any person who transmits or provides the programme and any
person having functions in relation to the programme
corresponding to those of the editor of a newspaper or periodical
publication,
commits an offence and is liable on conviction to a'fine of $50,000 and to
imprisonment for 6 months.
(8) Proceedings for an offence under this section shall not be instituted
except with the consent of the Attorney General.
(9) In this section-
'broadcast' (JRM) includes broadcast by radio, film, videotape or television;
'publish' ( ) means publish in writing.

27. Compensation

(1) If an investigation is begun against a person for a drug trafficking
offence or offences and any of the following circumstances occur, namely-
(a) no proceedings are instituted against that person;
(b)proceedings are instituted against that person but do not result in
his conviction for any drug trafficking offence; or
(c)proceedings are instituted against that person and he is convicted
of one or more drug trafficking offences, but-
(i) the conviction or convictions concemed are quashed; or
(ii) he is granted a pardon in respect of the conviction or
convictions concerned,




1989 Ed.] Drug Trafficking (Recovery of Proceeds) 63




the High Court may, on application by a person who held property which was
realisable property, order compensation to be paid by the Government to the
applicant if, having regard to all the circumstances, it considers it appropriate
to make such an order.
(2) The High Court shall not order compensation to be paid under
subsection (1) unless it is satisfied-
(a)that there has been some serious default on the part of any
person concerned in the investigation or prosecution of the
offence or offences concerned; and
(b)that the applicant has suffered loss in consequence of anything
done in relation to the property by or in pursuance of an order of
the High Court under sections 10 to 12.
(3) 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.
(4) Without prejudice to subsection (1), where-
(a) - a disclosure is made by any person in accordance with section
25(3) in relation to any property; -
(b)in consequence of the disclosure and for the purposes of an
investigation or prosecution in respect of a drug trafficking
offence or offences any act is done or omitted to be done in
relation to that property; and
(c)no proceedings are instituted against any person in respect of that
offence or offences or no order is made by the High Court under
section 10 or 11 in relation to that property,
the High Court may, on application by a person who held the property, order
compensation to be paid by the Government to the applicant if, having regard
to all the circumstances, it considers it appropriate to make such an order.
(5) The High Court shall not order compensation to be paid under
subsection (4) unless it is satisfied-
(a)that there has been some serious default on the part of any
person concerned in the investigation or prosecution of the
offence or offences concerned and that, but for that default, the
act or omission referred to in subsection (4)(b) would not have
occurred; and
(b)the applicant has, in consequence of the act or omission referred
to in subsection (4)(b), suffered loss in relation to the property.
(6) The amount of compensation to be paid under this section shall be
such as the High Court thinks just in all the circumstances of the case.
[cf. 1986 c. 32 s. 19 U.K.]




1989 Ed.] Drug Trafficking (Recovery of Proceeds) 65




28. Enforcement of external orders

(1) The Governor in Council may, with the approval of the Legislative
Council, by order-
(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) make-
(i) such provision in connection with the taking of action in the
designated country with a view to satisfying a confiscation
order; and
(ii) such provision as to evidence or proof of any matter for the
purposes of this section and section 29; and
(iii) such incidental, consequential and transitional provision,
as appears to him to be expedient; and
(c)without prejudice to the generality of this subsection, direct that
in such circumstances as may be specified proceeds arising out of
action taken in the designated country with a view to satisfying a
confiscation order and which are retained there shall nevertheless
be treated as reducing the amount payable under the order to
such extent as may be specified.
(2) An order under this section may make different provision for different
cases or classes of case.
(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.
[cf. 1986 c. 32 s. 26 U.K.]

29. Registration of external confiscation orders

(1) On an application made by or on behalf of the government of a
designated country, the High Court may register an external confiscation order
made there if-
(a)it is satisfied that at the time of registration the order is in force
and not subject to appeal;


1989 Ed.] Drug Trafficking )Recovery of Proceeds) 67




(b)it is satisfied, where the person against whom the order is made
did not appear in the proceedings, that he received notice of the
proceedings in sufficient time to enable him to defend them; and
(c)it* is of the opinion that enforcing the order in Hong Kong would
not be contrary to the interests of justice.
(2) In subsection (1) 'appeal' ( ) includes-
(a)any proceedings by way of discharging or setting aside a
judgment; and
(b) an application for a new trial or a stay of execution.
(3) The High Court shall cancel the registration of an external
confiscation order if it appears to the High Court that the order has been
satisfied by payment of the amount due under it or by the person against whom
it was made serving imprisonment in default of payment or by any other
means.
[cf. 1986 c. 32 s. 26A U.K.]

30. Evidence of corresponding law

Section 43 of the Dangerous Drugs Ordinance (Cap. 134) shall apply
in relation to proceedings under this Ordinance as it applies in relation to
proceedings for an ofrence under that Ordinance.

31. Amendment of Schedules

The Governor in Council may, by order, amend Schedules 1 and 2.

SCHEDULE 1 [s. 2]

DRUG TRAFFICKING OFFENCES

Offence Description*
section 4(1), Dangerous Drugs Ordinance trafficking in a dangerous drug
(Cap. 134)
section 5(1), Dangerous Drugs Ordinance supplying or procuring a dangerous drug to
(Cap. 134) or for unauthorized persons
section 6(1), Dangerous Drugs Ordinance manufacturing a dangerous drug
(Cap. 134)
section 7(1), Dangerous Drugs Ordinance possessing a dangerous drug for purpose of
(Cap. 134) unlawful trafficking
section 9(1), (2) and (3), Dangerous Drugs Cultivating, supplying, procuring, dealing in,
Ordinance (Cap. 134) importing, exporting, or possessing
cannabis plant or opium poppy
section 35, Dangerous Drugs Ordinance keeping or managing a divan for the taking of
(Cap. 134) dangerous drugs



1989 Ed.] Drug of Trafficking (Recovery of Proceeds) 69





Offence Description*
section 37, Dangerous Drugs Ordinance permitting premises to be(Cap. 134)trafficking, manufacturing or storage of
dangerous drugs
section 25, Drugs Trafficking (Recovery of assisting another to retain the benefit of drug
Proceeds) Ordinance (Cap. 405) trafficking

*Note: The short description of ofFences in this Schedule is for ease of reference only.

SCHEDULE 2 [s. 11]

ASSETS ON WHICH A CHARGING ORDER MAY BE IMPOSED

1. Land in Hong Kong.
2. Securities of any of the following kinds-
(a) Government stock;
(b) stock of any body incorporated in Hong Kong;
(c)stock of any body incorporated outside Hong Kong or of any state or territory outside
Hong Kong, being stock registered in a register kept at any place within Hong Kong;
(d)units of any unit trust in respect of which a register of the unit holders is kept at any place
within Hong Kong.
3. In this Schedule-
(a)the terms 'Government stock'(',&*) and 'land' (-+-M) have the same meaning as
in section 2 ofthe Supreme Court Ordinance (Cap. 4);
(b) the terms 'stock' and -unit trust' have the same meaning as in
section 20A of that Ordinance.



1989 Ed. Drug Trafficking (Recovery of Proceeds) 71 [cf. 1986 c. 32 s. 38 U.K.] [cf. 1986 c. 32 s. 1 U.K.] [cf. 1986 c. 32 s. 2 U.K.] [cf. 1986 c. 32 s. 3 U.K.] [cf. 1986 c. 32 s. 4 U.K.] [cf. 1986 c. 32 s. 5 U.K.] [cf. 1986 c. 32 s. 6 U.K.] [cf. 1986 c. 32 s. 7 U.K.] [cf. 1986 c. 32 s. 8 U.K.] [cf. 1986 c. 32 s. 9 U.K.] [cf. 1986 c. 32 s. 11 U.K.] [cf. 1986 c. 32 s. 12 U.K.] [cf. 1986 c. 32 s. 13 U.K.] [cf. 1986 c. 32 s. 14 U.K.] [cf. 1986 c. 32 s. 15 U.K.] [cf. 1986 c. 32 s. 17 U.K.] [cf. 1986 c. 32 s. 17A U.K.] [ cf. 1986 c. 32 s. 18 U.K.] [cf. 1986 c. 32 s. 27 U.K.] [cf. 1986 c. 32 s. 28 U.K.] [cf. 1986 c. 32 s. 29 U.K.] [cf. 1986 c. 32 s. 30 U.K.] [cf. 1986 c. 32 s. 31 U.K.] [cf. 1986 c. 32 s. 24 U.K.] [cf. 1986 c. 32 s. 19 U.K.] [cf. 1986 c. 32 s. 26 U.K.] [cf. 1986 c. 32 s. 26A U.K.] [ s. 2] [s. 11]

[cf. 1986 c. 32 s. 38 U.K.] [cf. 1986 c. 32 s. 1 U.K.] [cf. 1986 c. 32 s. 2 U.K.] [cf. 1986 c. 32 s. 3 U.K.] [cf. 1986 c. 32 s. 4 U.K.] [cf. 1986 c. 32 s. 5 U.K.] [cf. 1986 c. 32 s. 6 U.K.] [cf. 1986 c. 32 s. 7 U.K.] [cf. 1986 c. 32 s. 8 U.K.] [cf. 1986 c. 32 s. 9 U.K.] [cf. 1986 c. 32 s. 11 U.K.] [cf. 1986 c. 32 s. 12 U.K.] [cf. 1986 c. 32 s. 13 U.K.] [cf. 1986 c. 32 s. 14 U.K.] [cf. 1986 c. 32 s. 15 U.K.] [cf. 1986 c. 32 s. 17 U.K.] [cf. 1986 c. 32 s. 17A U.K.] [ cf. 1986 c. 32 s. 18 U.K.] [cf. 1986 c. 32 s. 27 U.K.] [cf. 1986 c. 32 s. 28 U.K.] [cf. 1986 c. 32 s. 29 U.K.] [cf. 1986 c. 32 s. 30 U.K.] [cf. 1986 c. 32 s. 31 U.K.] [cf. 1986 c. 32 s. 24 U.K.] [cf. 1986 c. 32 s. 19 U.K.] [cf. 1986 c. 32 s. 26 U.K.] [cf. 1986 c. 32 s. 26A U.K.] [ s. 2] [s. 11]

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