Speeches and Presentations

Bill against unfair trade practices to be introduced into the Legislative Council

The Commerce and Economic Development Bureau (CEDB) will introduce a Bill into the Legislative Council on February 29 (Wednesday) seeking to enhance consumer protection against unfair trade practices.

The Bill seeks to expand the scope of unfair trade practices against consumers that are prohibited under the Trade Descriptions Ordinance (Cap. 362). The expanded scope covers false trade descriptions to services, the practice of misleading omissions, aggressive commercial practices, bait advertising, bait-and-switch and the practice of wrongly accepting payment.

A spokesman for CEDB said today (February 22), "These practices prejudice consumers' right to information and freedom of choice as well as harm their economic interests. Traders who engage in any of the practices will commit a criminal offence and be liable to a maximum penalty of five years' imprisonment and a fine of $500,000.

"By making the practices criminal offences, the Bill will serve to enhance protection for consumers and create a level playing field for honest traders."

The Bill also aims to assist aggrieved consumers in seeking restorative justice. The Bill creates an express right under the Ordinance to allow any person, to whom any of the practices named above is directed, to institute private actions for damages suffered because of the offending conduct. The Bill also provides that when convicting a person of any of the offences, the court may order the convicted person to compensate any person for financial loss resulting from the offence.

"These provisions will complement public enforcement by strengthening avenues for consumer redress, thereby enhancing the efficacy of the Ordinance in promoting consumer welfare," the spokesman said.

The Bill will also put in place a compliance-based enforcement mechanism, under which enforcement agencies (principally the Customs and Excise Department) may seek undertakings from traders suspected of deploying unfair trade practices to stop and not to repeat an offending act and, where necessary, seek injunctions from the court for this purpose. The mechanism will provide a civil-based option, an alternative to the criminal route as is currently provided under the Ordinance, that the enforcement agencies may draw on in light of individual case circumstances. Such an alternative will encourage compliance and facilitate quicker settlement.

The Bill will be published in the Government Gazette on February 24.

Wednesday, February 22, 2012

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