Watches.com subsidiary has goods seized, director and staff out on bail   

AN INDIRECT subsidiary of  Watches.com : WVJ -25%, CKLY Trading Limited (CTL), is under investigation by the Hong Kong Customs and Excise Department (C& E) for alleged offenses related to Hong Kong&rsquo s Trade Description Ordinance (TDO).

Under the laws of Hong Kong, the TDO prohibits false trade descriptions and forged trademarks in respect of goods provided in the course of trade or business.

CTL is also an indirect associate of electronics distributor  Incredible Holdings : RDR 0%.

Both Watches.com and Incredible Holdings announced late on Monday (Sep 5) that C& E officers entered CKLY Trading&rsquo s premises on Aug 31 and seized about 500 watches amounting to a book value of some S$30,000.

While it was not mentioned if arrests were made, both groups in their respective bourse filings said the company&rsquo s executive director Christian Heilesen and a sales staff &ldquo had to attend at the headquarters of C& E at the instruction of C& E to assist with the investigation&rdquo .

Heilesen and the unidentified sales staff are said to be subsequently released on bail by the police at the fully-paid bail amounts of HK$20,000 (S$3,571) and HK$10,000, respectively.

Both parties&rsquo passports were not impounded by the authorities and there were no travel restrictions imposed on them.

The boards of Watches.com and Incredible Holdings said they do not deem the ongoing investigation as material considering the book value of the seized products and that neither group is reliant on Heilesen for proper oversight and management, among others.

Both Catalist-listed companies highlighted that Heilesen was not ordered to produce documents and &ldquo has only been asked to assist&rdquo with the investigation.

While Heilesen will have to report to police officers on the matter 3 months after his bail, the companies emphasised that he was not formally charged nor is the subject of any judgement or ruling. 

They added that it is CTL&rsquo s &ldquo clear and firm belief&rdquo that the watches seized are real and genuine.

&ldquo It is CTL&rsquo s firm stance that they have done nothing improper or illegal, let alone criminal, in the course of CTL&rsquo s business in relation to the watches seized. Both Mr Heilesen and the sales staff will contest all allegations made against them vigorously,&rdquo said Watches.com and Incredible Holdings.

The Catalist-listed counters were unchanged at S$0.016 and S$0.002, both companies called for a trading halt on Sep 2. Their shares resume trading on Tuesday.