LCQ20: Measures to protect online-shopping consumers' interests and boost e-commerce
Following is a question by the Hon Jimmy Ng and a written reply by the Secretary for Commerce and Economic Development, Mr Edward Yau, in the Legislative Council today (December 6):
A research report has pointed out that the value of global Internet retailing totalled HK$7,682 billion in 2015, accounting for 7.3 per cent of the total value of global retail sales. Such amount and percentage represent a rise by more than one-fold from the HK$2,946 billion and 3.1 per cent in 2010. Nonetheless, the findings of a survey indicate that Hong Kong consumers are not enthusiastic about online shopping as they have doubts over the quality of the products and services purchased online as well as concerns over the security and privacy protection of online payments. In this connection, will the Government inform this Council:
(1) whether it knows the number of complaints about online shopping received by the Consumer Council in each of the past three years, together with a breakdown by nature of complaint;
(2) whether the authorities will consider, by making reference to the relevant laws in Mainland China, South Korea and the European Union (EU), enacting a piece of legislation dedicated for online shopping which will include specific clauses (such as a cooling-off period) so as to enhance the protection for consumers; if so, of the details; if not, the reasons for that;
(3) given that the relevant laws in Mainland China, South Korea and EU provide that online retailers are obliged to provide consumers with clear information, including the contact details, description of the goods and services to be provided, payment methods, delivery arrangement, procedures for order cancellation and refund policy, whether the authorities will consider enacting similar legislation to safeguard consumers' right to know; if so, of the details; if not, the reasons for that;
(4) whether the authorities will consider, by making reference to the practices in EU and South Korea, establishing a mechanism or a platform for providing consulting and mediation services in respect of online shopping disputes, so as to resolve such disputes in a simple, fast and low-cost manner; if so, of the details; if not, the reasons for that; and
(5) given the concerns of some consumers over the security and privacy protection of online payments, whether the authorities will consider, by making reference to the practices in EU, South Korea and Singapore, launching a trust mark scheme for shopping websites with the collaboration among government departments, public organisations and relevant trade associations, so as to boost e-commerce in Hong Kong as well as cross-border e-commerce?
According the survey conducted by the Census and Statistics Department in 2016, about 1.7 million persons aged 15 and over used online purchasing services for personal matters during the 12 months before enumeration, constituting about 28 per cent of all persons aged 15 and over in Hong Kong. In a similar survey conducted in 2014, the corresponding figures were 1.42 million and 23 per cent, while the corresponding figures in a survey in 2009 were 0.92 million and 16 per cent. The surveys show that online shopping has become increasingly popular in Hong Kong.
In 2015, the Consumer Council conducted an on-street survey in Hong Kong on online shopping, and last year, it published the "Online Retail - A Study on Hong Kong Consumer Attitudes, Business Practices and Legal Protection" Study Report. According to the survey results, 79 per cent of consumers who had experienced online consumption said they were confident or very confident in online shopping; satisfaction levels were also very high with 98 per cent of consumers saying they were either satisfied or very satisfied with the online shopping experience. Consumers aged 15-44 indicated satisfaction with the efficiency, convenience and on-time delivery of online shopping, while consumers aged 45 or above indicated satisfaction with the lower prices of goods sold at online shops compared to physical stores, as well as goods and services meeting their expectations.
My reply to the five parts of the question is as follows:
(1) The numbers of complaints in relation to online shopping received by the Consumer Council in the last three years, by nature of the complaints, are set out at the Annex.
(2) Different jurisdictions adopt different approaches with regard to the provision of cooling-off periods for online shoppers. According to the above-mentioned report published by the Consumer Council, the authorities in the United Kingdom, the Mainland and Taiwan have legislation in place mandating traders to provide cooling-off periods to online shoppers. On the other hand, the report points out that in other countries or territories where e-commerce is booming, such as the United States, Australia and Singapore, there is no legislation requiring traders to provide cooling-off periods to online shoppers. The report also notes that online shopping often crosses different jurisdictions, and there are practical difficulties in seeking redress and law enforcement. Issues that should be considered in relation to the imposition of mandatory cooling-off periods on contracts are controversial, and the Consumer Council is conducting a study on this topic. We will continue to listen to the community's views and take into account the results of the Consumer Council's study.
(3) The rights of consumers, including that of online shoppers, are currently protected by various laws in Hong Kong. The Sale of Goods Ordinance (Cap. 26), Control of Exemption Clauses Ordinance (Cap. 71), the Supply of Services (Implied Terms) Ordinance (Cap. 457) and the Unconscionable Contracts Ordinance (Cap. 458) all regulate contracts related to transactions, for example by stipulating implied conditions in the contract of sale of goods, including that the goods supplied are of merchantable quality and that a buyer has the right to reject defective goods unless he or she has a reasonable opportunity to examine the goods; a supplier of a service is obliged to carry out the service with reasonable care and skill and within a reasonable time; and the courts are empowered to refuse to enforce, or to revise unconscionable terms in consumer contracts for the sale of goods or supply of services etc. Also, the Trade Descriptions Ordinance (Cap. 362) prohibits common unfair trade practices, including false trade descriptions and misleading omissions. Traders should not give any false or misleading product information to consumers, or else they would commit an offence.
Apart from legislation, publicity and education are equally important in protecting consumer rights. In the study report on online shopping published by the Consumer Council last year, the Council reminds consumers to be aware of some common problems in relation to online shopping, as it becomes increasingly popular. The report also gives a number of recommendations to traders, encouraging them to strictly comply with the law, adopt good practices and enhance customer services. The CHOICE Magazine published by the Consumer Council has in recent years featured a good number of articles on the subject of online shopping, giving tips to consumers on what they should pay attention to when purchasing various products online, including booking of hotel rooms, Internet banking services, group purchases, online purchase of food products, etc.
(4) The Consumer Council acts as a conciliator in handling disputes between consumers and traders. It adopts a flexible approach as it assists traders and complainants to resolve their disputes. The majority of complaints (74 per cent in 2016-17) could be resolved using this approach. The Consumer Council emphasised in its online shopping report that the Council would continue to monitor online shopping, and support initiatives by business or with its fellow consumer organisations on the development of online dispute resolution mechanisms.
(5) We notice that in some jurisdictions, chambers of commerce or trade associations representing the e-commerce sector have implemented trust mark schemes to reassure consumers of the trustworthiness of online retailers. We welcome the e-commerce sector to enhance its service level. One of the functions of the Consumer Council is to encourage businesses and professional associations to establish codes of practice to regulate the activities of their members. The e-commerce sector can consider co-operating with the Consumer Council to establish codes of practice for the trade, to foster fair trade practices and market competition.
Ends/Wednesday, December 6, 2017