Speeches and Presentations



LCQ13: Online group purchases

Following is a written reply by the Acting Secretary for Commerce and Economic Development, Mr Gregory So, to a question by the Hon Wong Kwok-hing in the Legislative Council today (May 11):

Question:

It has been reported that "online group purchases" have become popular in Hong Kong in recent years and many members of the public hope to buy products or services at favourable prices through this means. Nevertheless, from time to time there are members of the public who find that the products or services do not match the specifications or descriptions only after they had made the payments for the purchases, thus resulting in many disputes. As group purchase web sites and related sales activities are currently not under statutory control, members of the public have nowhere to turn to for assistance when they need to make complaints. In this connection, will the Government inform this Council:

(a) of the number of complaints about "online group purchases" received or dealt with by the Consumer Council and relevant law enforcement departments in each of the past five years; the reasons for and the amount of money involved in such complaints, and whether prosecution had been instituted in respect of those cases and the persons involved convicted;

(b) given that "online group purchases" continue to thrive, whether there are legislation and measures in place to regulate and monitor these activities; if there are, according to the assessment of the authorities, of the effectiveness of such work last year; if there is not, whether the authorities will consider enacting new legislation or extending the coverage of the existing Trade Descriptions Ordinance (Cap. 362), and following the practices of overseas countries and establishing an online certification system, in order to regulate group purchase web sites and related sales activities; and

(c) whether the authorities have any plan, measure or guideline to educate members of the public that when making "online group purchases" , they must choose those web sites with good reputation and backing, find out how sellers made transactions in the past and read the transaction terms carefully, so as to safeguard their own interests; if they have, of the details; if not, the reasons for that?

Reply:

President,

(a) In the past five years, the Customs and Excise Department has not received any complaints about "online group purchases". The Police does not keep separate statistics on complaints about such purchases.

Before 2009, the Consumer Council has not received any complaints about online group purchases. Details of the complaints about such purchases that the Consumer Council has received since 2009 are set out in the annex.

(b) The current Trade Descriptions Ordinance (Cap. 362) prohibits any person from applying false trade descriptions to goods in the course of trade. The Ordinance applies equally to trade conducted online and offline. The Customs and Excise Department is responsible for enforcing the Ordinance. The Department is committed to combating illegal business conduct. It will continue to deploy staff to conduct checks on the internet to meet actual needs.

To tackle unfair trade practices more effectively, the Bureau consulted the public on a package of legislative proposals last year. In January this year, the Bureau published a report on the outcome of the consultation. We intend to broaden the scope of the Ordinance from goods to services as well. Moreover, not only will the Ordinance prohibit false trade descriptions but it will also prohibit other types of common unfair trade practices, such as the practice of accepting payment without the intention or ability to supply goods or services contracted for. We believe that the implementation of these proposals will help tackle unfair trade practices that may be found in online group purchases.

(c) We have been in partnership with the Consumer Council in conducting publicity and public education activities to raise consumer awareness. In the light of the increasing popularity of online group purchases, the Consumer Council published in this year's April issue of its CHOICE magazine a feature article on online group purchases, introducing the operation of such purchases, possible transactional risks and points to bear in mind (for example, the need to understand the rights and obligations of these group purchases portals, the history of transactions conducted through such portals and the terms of transactions). We will continue to work with the Consumer Council to further consumer education.

Wednesday, May 11, 2011

Annex PDF