Hong Kong auditor calls for extension on time allowed for prosecution of illegal car sales

The six-month time bar for prosecuting those who sell first registration cars above the published retail price should be extended, said the auditor, after discovering that the Customs and Excise Department aborted investigations into one-fifth of suspected offenders.

Under the Motor Vehicles (First Registration Tax) Ordinance, a registered distributor commits an offence if he sells a car for more than the approved published retail price without first obtaining the department’s consent.

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Any prosecution, however, has to be instituted within six months of the date on which the Commissioner for Transport was first notified of the offence - or two years after the date on which the offence is committed - whichever is earlier.

In a sample check of 30 completed investigation cases between 2012 and last year, the auditor found five cases in which the Transport Department referred 692 vehicles suspected to have been sold for more than the approved price between March and November 2012.

Among the 692 cars, the Customs Department considered that investigations were necessary for 681 vehicles, but in the end 22 per cent of them - or 152 cars - were not investigated due to the passing of the legal time limit.

The audit report said the customs department had been reviewing the relevant provisions in the ordinance since 2013 and agreed that an extension of the six-month period was necessary.