Update

In a recent decision handed down in November 2007 - Koon Wing Yee v. the Securities & Futures Commission, the High Court confirmed the SFC’s right to compel a person to attend interviews and to answer questions notwithstanding the answers may incriminate him.

The Court held that as Mr. Koon (the Applicant) had not been charged with any criminal offence at the time of his interview, the “right to silence” afforded under the Bill of Rights Ordinance had no application.

Background

In the course of investigating possible market misconduct, the SFC issued a notice to Mr Koon to attend interviews and answer questions. Mr Koon brought judicial review proceedings against the SFC on the basis that the notice was in breach of the Bill of Rights, which provided that “in the determination of any criminal charge”:

• a person should not be compelled to testify against himself or to confess guilt (Article 11(2)(g)), and
• a person is entitled to a fair hearing by an impartial tribunal (Article 10).

The SFC argued that the proceedings were premature, as no criminal charges have yet been laid against Mr. Koon.

The High Court ruled in favour of the SFC and dismissed Mr. Koon’s application on the following two grounds:

• The Court found that it was bound by a Court of Final Appeal case decided on the same point (“First Ground”).
• Historically, it had always been the position that a person under investigation was obliged to attend to interviews and give answers and since circumstances had not changed, the historical position should be followed (“Second Ground”).

First Ground : decision from upper court

In HKSAR v. Lee Ming Tee & Another the CFA held that the Bill of Rights only applies to persons who face a criminal charge. Saunders J in the present case considered that the CFA decision was conclusive and binding, and because Mr. Koon had not yet been charged with any criminal offence, the Bill of Rights had no application.

Saunders J further considered that if criminal proceedings were commenced against Mr. Koon, his compelled answers were in any event inadmissible by virtue of S. 187(2) of the Securities and Futures Ordinance (“SFO”), which would render his compelled answers generally inadmissible in subsequent criminal proceedings.

Second Ground : historical position

The Court took the view that historically under the repealed s 33 (1) of the Securities and Futures Commission Ordinance, it had always been the position that a person under investigation was obliged to attend interviews and answer questions. The Court of Appeal in R v Securities and Futures Commission Ex Parte Lee Kwok Hung held that the aforesaid provision does not offend either Article 11 (2) (g) or Article 10 of the Bill of Rights.

The current corresponding provision under the SFO is, although less comprehensive, of the same effect of the repealed s 33(1). As the circumstances have not changed since the Lee Kwok Hung case, that judgment should be followed.

Commentary

The Court has once again confirmed the SFC’s powers to compel a person to attend interviews and provide answers under the SFO. It is important to fully appreciate the ambit of this power and its consequence since, if criminal proceedings are to be pursued, any derivative information from the compelled answers are admissible in those criminal proceedings.