THE QUEEN v. COLBY & STATION (QUOTAS) LTD

IN THE SUPREME COURT OF HONG KONG

(APPELLATE JURISDICTION)

MAGISTRACY APPEAL NO. 570 OF 1989

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BETWEEN

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J U D G M E N T

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1. The appellant company pleaded guilty, after evidence had been adduced for six days' to a charge of making a false statement in a material particular in applying for an export licence for textiles to America.

2. An application for an export licence must specify compliance with four out of six conditions printed on the back of the application form there was compliance with only two.

3. The case of the Attorney General v Marvels Clothing Co. Ltd. (1987) H.K.L.R. 839 was referred to by the learned Magistrate who pointed out that that case concerned goods which were manufactured in China but which were falsely represented to have been made here. Such cases could be a breach of the agreement between Hong Kong and America and would affect the international reputation of Hong Kong. In the instant case the Magistrate said there was no question of the appellant having breached an agreement between Hong Kong and America which, as he said, was the 'grave feature' of Marvels case.

4. A Trade Officer of the Trade Department testified that the breach of condition 3, although an internal matter, would have two consequences: the figures on which the allocation of quotas for the following year would be incorrect leading to quotas being issued to companies not entitled to them, to the prejudice of genuine companies which might not be able to obtain quotas although meriting them and also the incorrect details would make it impossible to ensure the correct operation of the quota system.

5. The appellant was fined $250,000 and not $385,350 which would have been the case if the Marvel guideline had been used.

6. The Magistrate found the guideline in Marvels case as binding on him in principle but said he regarded the preset case as less serious because of the absence of the 'grave feature' already referred to.

7. The fine of $250.000 was 75% of a fine calculated on the Marvels guideline. Mr. McCoy suggested the fine should be between 2½ times the profit asserted to be $8,000 and less than a fine based on 75% of a fine (calcuated on the Marvels') calculation, namely $250,000 which was manifestly excessive.

8. The figure of $8,000 as profit was asserted in mitigation. Mr. Madigan for the Crown referred to that figure as 'plucked out of the air'. The Magistrate had found figure hard to accept. The goods in question were sold to the consignee for about $900,000.

9. The appellant is a large company. I am unable to say, in the circumstances of this case, that the fine of $250,000 is manifestly excessive and the appeal is dismissed.