Liu Chaoxun v Administration for Industry and Commerce of Wenchang City Hainan Province and Administration for Industry and Commerce of Hainan Province in respect of Dispute over Industrial and Commercial Administrative Penalty

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Liu Chaoxun v Administration for Industry and Commerce of Wenchang City Hainan Province and Administration for Industry and Commerce of Hainan Province in respect of Dispute over Industrial and Commercial Administrative Penalty

 

Case No.: (2015) QHFXCZ No.12

Cause of action:  Dispute over Industrial and Commercial Administrative Penalty

Sea area involved: Sansha

Date:  21 September 2016

 

Gist

 

  1. In determining an administrative penalty, not only the illegal profit earned by the party to which the administrative penalty is imposed but also the danger to social and severity of the consequence shall be taken into consideration.
  2. The crew are performing their duties by participating in the fishing boat’s operation activities, the consequence shall be assumed by the owner of the fishing boat.

 

Application law

 

Article 69 of the Administrative Procedure Law of the People's Republic of China

 

Basic facts

 

On 8 May 2015, the Ocean and Fishery Supervision Division of Hainan Province issued the Decision of Administrative Penalty under the case number of WGSCZ (2015) No.10 for fishery penalty. It’s ascertained by the Decision that the Claimant put the fishing boat “Yue Yang Xi Yu 39578” (hereinafter referred to as the “subject fishing boat”) under the management of Liu Gonggu, the Chief Officer, and Liu Jiecen, the Chief Engineer and other crew. Under the circumstance that Liu Gonggu and other crew should know that Wang Lin, the tourism organizer, has no business license and the permit for carrying out tourism business, they changed the fishing boat’s purpose of use and provided Wang Lin with the boat to carry 35 tourists for marine tourist activities in Sansha sea area, which has significant safety risk, severely disrupted the order of the tourism market, and brought adverse influence to the society due to its large scale. In accordance with Article 15 of the Measures for Investigating, Punishing and Banning Unlicensed Business Operations, it’s decided to confiscate the illegal profits earned by the Claimant in an amount of RMB70,000 and impose an administrative penalty of RMB500,000. The Claimant was dissatisfied with the decision and applied for administrative reconsideration before the Administration of Industry and Commerce of Hainan Province, which issued the No.4 Decision of Reconsideration on 17 July 2015 sustaining the No.10 Penalty Decision rendered by the Administration of Industry and Commerce of Wenchang City. Liu Chaoxun was in dissatisfaction and brought the lawsuit before this Court.

 

In the night on 21 February 2015, the subject fishing boat departed from Sanya Port carrying 11 crewmembers and 35 tourists, and was caught by the 3rd coastguard division during patrol in Panshiqi sea area. At the material time, the subject fishing boat was equipped with 4 lifeboats, 1 life raft, 27 sets of lifejackets. There were 46 persons onboard including 35 tourists and 11 crewmembers including the Master Liu Jiecen and the Chief Officer Liu Gonggu. The subject fishing boat was made in steel with a total tonnage of 169tons without facilities and qualification for carrying tourists. The Claimant Liu Chaoxun is the owner of the subject fishing boat. The subject fishing boat was equipped with 4 lifeboats, 1 lifeboat, 27 sets of lifejackets. The subject fishing boat was completed on 17 April 2014 and put into operation in June 2014. Saved for his attendance onboard, the Claimant makes Liu Gonggu and Liu Jiecen fully in charge of the daily operation and management of the boat. In this occasion, the Claimant was not onboard and it’s the Chief Master Liu Gonggu and other crewmembers who contacted the tourism organizer.

 

The Claimant requested to revoke the No.10 Decision rendered by the Defendant Administration of Industry and Commerce of Wenchang City.

 

Reasoning

 

The effective judgement holds:

 

The act by Wang Lin in organizing 35 tourists for tourism in Sansha sea area by renting the subject fishing boat “Yue Yang Xi Yu 39578” has been ascertained as operation without license by the administrative judgment of (2015) QHFXCZ No.15 by this Court and (2016) QXZZ No.233 by Higher People’s Court of Hainan Province. In this case, Liu Gonggu (the manager of the fishing boat) and other employees of the Claimant chartered, without examination on Wang Lin’s qualification for running tourism business, the fishing boat which was not equipped with passenger carriage facilities and did not obtained relevant operational qualification to Wang Lin, who did not has license, to carry 35 tourists to Sansha sea area for tour. It’s proper for the Administration of Industry and Commerce of Wenchang City and Administration of Industry and Commerce of Hainan Province to ascertain that the Claimant was providing conveyance for the party who carried out business without obtaining business license and permit for operating tourism business.

 

In the tourism business in question, the Claimant’s employees collected RMB180,000 in total, including RMB30,000 for purchasing living supplies and RMB50,000 for bunker. The subject boat is a fishing boat without facilities for carrying passengers and relevant qualification for operating tourism business. Besides, the subject fishing boat was only equipped with 4 lifeboats, 1 life raft and 27 sets of lifejackets, which is far from enough for the 11 crewmembers and 35 tourists onboard. Liu Gonggu and other crewmembers used the subject fishing boat to carry 35 tourists for tour at sea without obtaining authorization. It’s proper for the Administration of Industry and Commerce of Wenchang City to made an administrative penalty, upon clearly finding the illegal acts, to confiscate the illegal profits of RMB70,000 earned by the Claimant and impose a penalty of RMB500,000 on the Claimant.

 

As the administrative reconsideration authority, the Defendant, Administration of Industry and Commerce of Hainan Province, served, after accepting the application by the Claimant for administrative reconsideration, the Notice for Reply to Administrative Reconsideration to Administration of Industry and Commerce of Wenchang City and made and served the No.4 Decision of Reconsideration within the time limit provided in law. The No.4 Decision of Reconsideration made by the Administration of Industry and Commerce of Hainan Province was in compliance with the lawful procedures.

 

The Claimant argued that he was not aware of and has not participated in the use of the subject fishing boat for carrying tourist for tour at sea, and thus he shall not be imposed with the administrative penalty. In this respect, this Court holds that the Claimant is the owner of the subject fishing boat, which was under the management of the Chief Officer, Liu Gonggu. The management and operational activities conducted by Liu Gonggu (as the manager) and other crewmembers onboard could be ascertained as their performance of duties, and the liability for such operational activities (performance of duties) shall be borne by Liu Chaoxun as the owner of the fishing boat. Besides, according to the records of inquiry on the Claimant, he should know the fact that the fishing boat was used to carry passengers for tour at sea. It’s proper for the Administration of Industry and Commerce of Wenchang City to impose penalty on the Claimant.

 

Judgement

 

It’s ruled to overrule the Claimant’s claims.