From 16 July 2018, travellers to and from Hong Kong are now required to declare cash sums larger than HK$120,000. The Hong Kong Security Bureau announced the Cross-boundary Movement of Physical Currency and Bear Negotiable Instruments Ordinance in 2017 to tackle funds arriving in Hong Kong from illegal sources such as money laundering and terrorist financing.
Under the ordinance, a traveller in possession of a large quantity of currency or bearer negotiable instruments (CBNIs) valued at more than HKD$120,000 arriving to Hong Kong via a specified control points is required to make a written declaration of the CBNIs to the Customs and Excise Department (C&ED) using the Red Channel under the Red and Green Channel System (RGCS).
Specified control points defined in the ordinance are Lo Wu, Hung Hom Station, Man Kam To boundary, Sha Tau Kok boundary, Hong Kong –Macau Ferry Terminal, China Ferry Terminal, Lok Ma Chau boundary, Hong Kong International Airport, Tuen Mun Ferry Terminal, Shenzhen Bay Port Hong Kong port area, Lok Ma Chau Spur Line, Kai Tak Cruise Terminal and Ocean Terminal.
If a traveller arrives in Hong Kong not via a specified control point or is about to leave Hong Kong, they must disclose, upon the request of the C&ED, whether they are in possession of a large quantity of CBNIs and, if so, make a written declaration of the CBNIs. For a large quantity of CBNIs imported or exported in a cargo consignment, an advanced electronic declaration must be made to the C&ED.
Only persons in transit at the Hong Kong International Airport are exempted from the declaration and disclosure requirement.
From 16 July, a three-month grace period for initial violators is in place. Travellers in violation will be given a written warning and fined HK$2,000 without criminal prosecution. However, the fine is recorded in a register and if the offence is committed again, the court or magistrate may take the first record into account. After, the grace period, failure to declare may lead to criminal prosecution with a maximum penalty of two years in prison and a fine of HK$500,000.
First-time offenders may discharge their liability by payment of HK$2,000 on condition there is no previous conviction of money laundering or terrorist financing and the CBNIs are not reasonably suspected to be criminal or terrorist property.
The ordinance monitors CBNIs entering or leaving Hong Kong by border agents and is an implementation of Recommendation 32 of the Financial Action Task Force (FATF). The recommendation aims to strengthen the prevention of money laundering and terrorist financing through cross-boundary transportation of CNBIs.
Travellers should note the ordinance does not prohibit the movement of cash in and out of the country, rather CNBIs exceeding the threshold amount shall be reported to customs in accordance with the ordinance. Failure to adhere may result in strict penalties.
If you would like more information on transporting currency and CBNIs or other related corporate issues, send us an email at talktous@horizons-advisory.com, and we’ll have a Horizons professional contact you.
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