PLC Paper No. CB(2)624
(These minutes have been
seen by the Administration
anc cleared with the Chariman)
Minutes of the Sixth Meeting of the Bills Committee
on the Mutual Legal Assistance in Criminal Matters Bill
held on Monday, 2 June 1997 from 10:30 am to 2:30 pm
in Conference Room A of the Legislative Council Building
Members Present :
Hon James TO Kun-sun (Chairman)
Hon Ronald ARCULLI, OBE, JP
Hon Emily LAU Wai-hing
Hon Eric LI Ka-cheung, OBE, JP
Hon Andrew CHENG Kar-foo
Hon IP Kwok-him
Hon Margaret NG
Hon Bruce LIU Sing-lee
Public Officers attending :
- Mr Alan CHU
- Principal Assistant Secretary for Security
- Mr John HUNTER
- Deputy Principal Crown Counsel (International Law)
- Mr Geoffrey FOX
- Senior Assistant Law Draftsman
- Ms Eva YAM
- Assistant Secretary for Security
Attendance by Invitation:
- Hong Kong Society of Accountants
- Mr Alvin WONG
- Chairman, Legal Committee
- Ms Winnie CHEUNG
- Director of Professional Practices
- Mr Peter GRIFFITHS
- Member, Legal Committee
Clerk in Attendance :
- Mrs Mary TANG
- Chief Assistant Secretary(2)4 (Atg)
Staff in Attendance :
- Mr Jonathan DAW
- Consultant (Legal Service)
- Mr Stanley MA
- Senior Assistant Secretary(2)9
(I) Meeting with the Administration and Hong Kong Society of Accountants
LegCo Paper Nos. CB(2) 2495/96-97(01), 2513/96-97, 2375/96-97(01) and 2524/96-97
Members agreed to discuss the revised first batch of the Administration's proposed Committee stage amendments (CSAs) dated 26 May 1997 [circulated vide LegCo Paper No. CB(2) 2359/96-97(01) dated 20 May 1997] and the second batch of CSAs dated 29 May 1997 [circulated vide LegCo Paper No.CB(2)2375/96-97 dated 21 May 1997]
Revised draft of first batch of CSAs (fifth draft)
Clause 2(1) - Definition of appropriate authority
2. The definition of appropriate authority was re-drafted as "in relation to a place outside Hong Kong, means a person whom the Attorney General (AG) is satisfied is a person who for the time being may under the law of that place make a request to Hong Kong for assistance in a criminal matter." This ensured that AG had to be satisfied that the authority making or receiving the MLA requests was authorized under the law of the requesting jurisdiction. In its submission dated 30 May 1997, the Hong Kong Society of Accountants (HKSA) pointed out that the appropriate authority of an overseas jurisdiction which was authorized to receive requests for legal assistance from Hong Kong could be different from that which was authorized to make requests to Hong Kong. Deputy Principal Crown Counsel (International Law) DPCC(IL) agreed to re-draft the definition for such purpose. Members had no objection.
Clause 4 - Governor in Council may apply Ordinance
3. The Administration proposed to add "with the approval of the Legislative Council," after "The Governor in Council may," in clause 4(1), the deletion of clauses 4(2) to 4(7) inclusive, and the substitution of clauses 4(10) and 4(11) by a new clause 4(10). Mr Ronald ARCULLI was concerned that the provisions of the Bill only allowed LegCo to repeal but not amend an order which implemented a MLA agreement. DPCC(IL) explained that it would not be appropriate to unilaterally alter the terms of an agreement without consulting the other party. If the terms of an agreement were not totally agreeable, the orders would need to be repealed and the terms of the agreement would have to be re-negotiated with the overseas jurisdiction concerned.
Clause 10 - Requests to Hong Kong for taking of evidence, etc.
4. The Administration proposed to add a clause 10(2A) to stipulate four conditions under which the magistrate concerned had discretion to decide whether the court proceedings for the taking of evidence or production of things should be conducted in camera. After discussion, members suggested and the Administration agreed to re-draft the proposed clause 10(2A)(c) to confine the magistrate's discretionary power in respect of holding court proceedings in camera to the taking of evidence or production of things at the investigation stage of criminal matters outside Hong Kong.
5. Clause 10(11) provided that evidence taken for criminal matters in overseas countries which had entered into a MLA agreement with Hong Kong should not be admissible in evidence for the purposes of any criminal matter or civil proceedings in Hong Kong except that the person giving the evidence committed an offence of perjury (clause 10(11)(a)) or .perverting the course of justice (clause 10(11)(b)) in connection with that evidence. Members found the scope of the latter exception too wide. The Administration agreed to delete clause 10(11)(b).
6. Consultant (Legal Service) CONS(LS) pointed out that the proposed new clause 10(9) did not cover the original clause in full. The Administration agreed to retain the original clause 10(9) to ensure that a person was not compellable to give evidence or produce a thing for a criminal matter in a place outside Hong Kong that the person could not be compelled to give or produce in Hong Kong on the ground that to do so might tend to incriminate him.
7. Members were concerned whether evidence taken for an overseas jurisdiction under a MLA agreement could be used to incriminate the person giving the evidence by way of other Ordinances such as the Organized and Serious Crimes Ordinance (Cap 445) and the Securities and Futures Commission Ordinance (Cap 24). In view of the complexity of the issue, Senior Assistant Law Draftsman (SALD) undertook to follow up the issue and re-draft clause 10(9) to ensure that sufficient protection was provided for the persons giving evidence under MLA requests.
Investigation into tax offences
8. Referring to the taking of evidence at the investigation stage of a criminal matter, Mr Alvin WONG of HKSA said the CSAs in the Evidence (Amendment) (E(A)) Bill provided for a mandatory exclusion of tax matters whereas the MLA Bill only provided for the exclusion on a discretionary basis. DPCC(IL) replied that US would not sign the MLA agreement with Hong Kong if its scope of application did not cover taxation matters. Mr WONG responded that the Committee should decide, as a matter of principle, whether the primary legislation (the Bill) should determine the contents of MLA agreements or the provisions in a signed MLA agreement could deviate from the contents of the Bill. Mr Eric LI questioned why the Administration, knowing that members of the Bills Committee on E(A) Bill had expressly objected to the taking of evidence at the investigation stage of external criminal matters relating to taxation, had proceeded to sign the MLA agreement with US. DPCC(IL) explained that the Administration agreed to the exemption of tax matters from the E(A) Bill because E(A) Bill was a proposed domestic law and its clauses were drafted to meet the needs of Hong Kong people. As far as the contents of a MLA agreement was concerned, the essential needs of overseas countries would have to be considered on a reciprocal basis.
9. As to the discretionary power of AG to refuse a request for assistance in the investigation of a criminal matter relating to taxation as proposed in clause (5)(2)(aa), Mr Eric LI expressed reservations on the ground that AG would be exposed to considerable pressure in reaching such decisions. Representatives of HKSA shared the same view. DPCC(IL) responded that decisions of AG under this clause were judicially reviewable.
10. Miss Margaret NG opined that the community would have difficulty in accepting that legal assistance in relation to tax frauds should not be provided to overseas jurisdictions on a reciprocal basis. Mr ARCULLI pointed out that it was always difficult to delineate investigations between tax offences and tax assessment. Given its simple domestically-oriented tax regime, Mr LI opined that Hong Kong would have little to gain in terms of reciprocity in relation to legal assistance in tax matters. He was concerned that the Bill would be exploited by overseas jurisdictions to facilitate their tax collection exercises which would subsequently undermine Hong Kong's competitiveness as a financial centre with a low tax jurisdiction. He stressed that overseas jurisdictions were onerous to inform AG of the purposes and exact information required in relation to each request for assistance. He urged the Administration to consider the benefits of Hong Kong people first in its negotiation with foreign jurisdictions for MLA agreements. DPCC(IL) responded that requests for assistance in investigation into tax matters and requests which were not made by or on behalf of a court could be refused under the proposed clause 5(2)(aa).
The MLA agreement with US
11. Members queried why the double criminality criterion, which was specified in clause 5(1)(g) of the Bill as one of the mandatory grounds for refusal of requests, was not applicable in the MLA agreement with US. DPCC(IL) explained that many countries did exclude the criterion in their MLA agreements because different countries had different judicial systems. He pointed out that US had entered into 11 MLA agreements and none of them had incorporated the double criminality criterion. He admitted that there had been exceptions in the MLA agreement with US for a list of serious offences which were not offences in Hong Kong. Mr ARCULLI drew members' attention to Article 1(3) of the agreement which specified that the agreement should include assistance for criminal offences related to taxation, customs duties, foreign exchange control, or other revenue matters but not assistance for non-criminal proceedings relating thereto. He found the definition of "customs duties" and "foreign exchange control" too vague and expressed reservations on this Article. In response to Mr LI's enquiry, the Administration confirmed that LegCo had the legislative power to repeal the relevant order of the Governor in Council when it was tabled in LegCo. Members concurred that further deliberations on the Articles of the signed MLA agreement with US should be arranged in due course.
12. SALD further explained that modifications in the orders implementing bilateral agreements were necessary as MLA laws and practices varied from jurisdiction to jurisdiction. With the proposed CSAs, a MLA agreement should be in substantial conformity (proposed clause 4(7B)) with the provisions of the Bill and the orders implementing MLA agreements were subject to positive vetting procedures (proposed clause 4(10)). In response to members' concerns, SALD agreed that modifications in these orders would be set out in a Schedule.
Second batch of CSAs (second draft)
Clause 4 - Governor in Council may apply Ordinance
13. The Administration proposed a CSA which required that the Governor in Council should not make an order under subsection (1) unless the arrangements for MLA were substantially in conformity with the provisions of the Bill. Mr LI requested the Administration to draw members' attention to any modifications in an order. SALD reiterated that modification in the orders would be set out in a Schedule.
Clause 5 - Refusal of assistance
14. In view of members' and HKSA's concerns on the taking of evidence at the investigation stage of criminal matters relating to tax offences as described in paragraphs 8 to 10, DPCC(IL) undertook to re-draft a CSA for members' consideration.
Clause 8 - Requests for assistance to Hong Kong
15. The Administration proposed to add clause 8(2)(h) to require that requests for assistance to Hong Kong under MLA agreement should be accompanied by a written statement setting out the maximum penalty for the external offence to which the criminal matter related. Members accepted the proposal.
Clause 10 - Requests to Hong Kong for taking of evidence, etc
16. The Administration proposed a new clause 10(12) requiring that AG should not authorize the transmission of the original of a thing to a place outside Hong Kong unless the appropriate authority of the requesting jurisdiction had provided reasonable justification and undertaking which satisfied AG that the original of the thing would be returned. Mr Peter GRIFFITHS of HKSA pointed out the need for compensation to be made to the legitimate owner when the original of the thing could not be returned to Hong Kong. Mr ARCULLI supplemented that the court did have discretionary power to confiscate the original of the thing. Miss NG pointed out that the appropriate authority should not give an undertaking to AG if it could not guarantee the return of the original thing and AG should decide whether the terms of the undertaking for the return of the original thing were sufficient. In the light of members' comments, the Administration would re-draft the clause for members' further scrutiny.
Clause 12 - Requests to Hong Kong for search and seizure
17. The Administration proposed and members accepted the proposed CSAs to the effect that-
- in the case of a thing seized by an authorized officer was a document (proposed clause 12(9)), a copy of the document should be given to the person from whom the document was seized; and
- AG should not give a direction to send the original of a thing to a place outside Hong Kong unless the appropriate authority of the place had provided reasonable justification and undertaking that the original of the thing would be returned (clause 12(10A)).
Clause 15 - Requests to Hong Kong for production, etc of material
18. The Administration proposed to add a clause 15(5)(c) to require that the appropriate authority of the requesting jurisdiction should provide reasonable justification and undertaking which satisfied AG that the original of the material would be returned. Members accepted the proposal.
Clause 17 - Immunities
19. Members accepted the Administration's proposal to substitute the word "foreign" by "external" in clause 17(2).
Clause 23 - Requests for removal from Hong Kong
20. The Administration proposed to replace clauses 23(1)(d)(i) and 23(1)(d)(ii) respectively by "that place has given adequate (whether or not qualified) undertakings in respect of the matters referred to in subsection (2)" and "the prisoner or other person has been given a copy of those undertakings and has subsequently consented to giving such assistance in that place". These amendments ensured that a person or a prisoner who was requested to travel to the requesting jurisdiction to give legal assistance was made aware of the undertaking given by that jurisdiction before he/she consented to such request. Members accepted the proposal.
Schedule 1 and 2
21. Members accepted the proposed technical amendments to the Bill in accordance with the amended provisions of the enacted Bankruptcy (Amendment) Ordinance 1996 (76 of 1996).
The overriding power of the Bill
22. Ms CHEUNG of HKSA was concerned about the overriding power of an order made under clause 15(2) over secrecy or other restriction upon the disclosure of information imposed by statute or otherwise. She enquired whether a person could appeal to the court or request a judicial review on AG's decision. The Administration replied that as the application to the court for the order was authorized by AG, the person who had reasons to refuse to act in accordance with the order could apply a judicial review of AG's decision. In this connection, CONS(LS) advised members to consider whether an appeal mechanism for such purpose should be provided for in the Bill. Members agreed to consider the issue when receiving the Administration's full set of updated CSAs.
Date of next meeting
23. The next meeting would be held at 12:30 pm on 4 June 1997 in Conference Room A of the Legislative Council Building.
24. The meeting ended at 2:30 pm.
Provisional Legislative Council Secretariat
24 November 1997
Last Updated on 30 November 1998