Review of confiscation orders in tobacco cases

Following the case of R v Chambers [2008] EWCA Crim 2467 which was handed down by the Court of Appeal on 19 October 2008, we have completed a review of historic cases in which confiscation orders were obtained in tobacco smuggling cases.

This exercise is known as "the Chambers Review". The process for the Chambers Review is set out below.

The Chambers Review process

Stage 1

The Crown Prosecution Service (CPS) (incorporating the Revenue and Customs Prosecutions Office "RCPO") retrieved and reviewed every case and every defendant for whom all the following criteria were met: tobacco products case prosecuted by HM Customs and Excise, Customs and Excise Prosecutions Office or RCPO involving (whether on the indictment or in the confiscation proceedings) an importation (or other trigger for an excise duty point) in relation to tobacco products since 1 June 2001 in which a confiscation order was made.

Stage 2

Within those cases identified, the defendants or their solicitors were alerted if either of the following criteria were met: 1992 Regulations raised by the prosecution or relied upon by the judge the case of Rowbotham [2006] EWCA Crim 747 (in which the incorrect regulations were cited) raised by the prosecution or relied upon by the judge.

If you have any queries in relation to the Chambers Review or would like to check whether your case has been reviewed, please contact us by telephone, post or email using the details below:

Proceeds of Crime Unit
CPS (incorporating Revenue and Customs Prosecutions Office)
7th Floor, Rose Court
London SE1 9HS

Telephone 020 3357 0000
Email enquiries@rcpo.gsi.gov.uk

Review of confiscation cases following R v Chambers [2008] EWCA CRIM 2467

Genesis of "the Chambers Review"

1. When considering confiscation in cases involving tax fraud a Crown Court is entitled by s76(5) of the Proceeds of Crime Act 2002 to determine the level of benefit by reference to the pecuniary advantage obtained by a defendant as a result of or in connection with his criminal conduct. A similar provision appeared in s71(5) of the Criminal Justice Act 1988.
2. In R v May [2008] 2 WLR 1131, the House of Lords in its "End Note" at paragraph 48(6) gave guidance for future cases as follows: "He [the Defendant] ordinarily obtains a pecuniary advantage if (amongst other things) he evades a liability to which he is personally subject."
3. Thus in the subsequent appeal in R v Chambers [2008] EWCA Crim 2467 an issue arose as to who in a tobacco smuggling or harbouring case would be personally liable to pay the excise duty that had undoubtedly been evaded by someone. The Crown initially sought to rely upon Regulation 5 of the Excise Goods (Holding, Movement, Warehousing and REDS) Regulations 1992 as determining the person liable to pay. It was however discovered prior to judgment being delivered that these Regulations had in 2001 been amended so as partially to disapply them in relation to tobacco products.
4. In their place since 1 June 2001 were the Tobacco Products Regulations 2001 which by Regulation 13 set out the categories of persons who are liable to pay the duty.
5. Excise duty is chargeable and payable (and evaded if it is not paid) at an "Excise Duty Point" which will generally (at least in cases not involving duty suspension arrangements, distance selling or registered persons) be at importation or manufacture in the UK. The person who physically imports the goods (or who holds the goods at the time of importation) is personally liable for the duty under both sets of Regulations.
6. But whereas under Regulation 5(3) of the 1992 Regulations the categories of persons jointly and severally liable to pay the duty also include (b) any person acting on behalf of the importer and (e) any consignee of imported goods, those categories were excluded from the 2001 Regulations. Under Regulation 13 of the 2001 Regulations the only other person jointly and severally liable to pay is (leaving aside registered persons) any person who "caused the goods to reach an Excise Duty Point".
7. Unfortunately this amendment to the Regulations was not widely known among many persons involved at all levels of confiscation cases. As the Court observed in Chambers the legislation was inaccessible. It was discovered that for a period of some time textbook authors, HM Revenue and Customs investigators, solicitors, counsel and courts (including the Court of Appeal in Rowbotham [2006] EWCA Crim 747) had not appreciated that the REDS regulations no longer applied to tobacco products.
8. This was however not a universal failing: for example in R v Edwards (Glyn) [2004] EWCA Crim 2923 the Court had been referred to both sets of Regulations. In other post-2001 cases (Houareau [2005] EWCA Crim 2106, Bakewell [2006] EWCA Crim 2) the Court does not appear to have relied upon the Regulations at all. The leading House of Lords case (R v Cadman Smith [2002] 1 WLR 54) did refer to the 1992 Regulations, but correctly, since it involved a pre-2001 importation.
9. But other courts may have been misled as to the applicable regulations and in Chambers RCPO (now CPS) gave an assurance to the Court that it would carry out a review of historic cases so as to alert defendants in whose cases the courts might have been misled at least to the knowledge of that fact and of the consequent possibility of seeking leave to appeal out of time.
10. This exercise is now known as "the Chambers Review".

Criteria for the Chambers Review

Stage 1

CPS has retrieved and reviewed every case and every defendant for whom all the following criteria were met:

• tobacco products case prosecuted by HM Customs & Excise, Customs and Excise Prosecutions Office or RCPO
• involving (whether on the indictment or in the confiscation proceedings) an importation (or other trigger for an excise duty point) in relation to tobacco products since 1 June 2001
• in which a confiscation order was made.

Stage 2

Within those cases thus identified the defendants or their solicitors were alerted where either of the following criteria are met:

• 1992 Regulations raised by the prosecution or relied upon by the judge
• Rowbotham raised by the prosecution or relied upon by the judge.