LCQ5: Regulating contents of advertisements
Following is a question by the Hon Fred Li Wah-ming and an oral reply by the Secretary for Commerce and Economic Development, Mrs Rita Lau, in the Legislative Council today (February 4):
It has been reported that the Advertising Standards Authority (ASA) of the United Kingdom adjudicated last month that the claim made in an advertisement for a famous brand of skin product that users would "start to see wrinkles disappear instantly" was unsubstantiated and was likely to mislead. ASA also adjudicated in January 2007 that the claim made in an advertisement for a brand of toothpaste that "more than 80% of dentists recommend" the toothpaste was misleading. Both sellers were requested to stop making such relevant claims. On the other hand, similar claims are often found in advertisements in Hong Kong. In this connection, will the Government inform this Council:
(a) of the existing measures in place to monitor the contents of advertisements to prevent product sellers from making misleading statements or misrepresentations in advertisements;
(b) of the number of sellers prosecuted in each of the past three years for making misleading statements or misrepresentations in product advertisements; and
(c) as the report on "Fairness in the Marketplace for Consumers and Business", published by the Consumer Council in February last year, recommends the introduction of a comprehensive trade practices statute in Hong Kong to prohibit retailers from using unfair trade practices in selling various types of goods and services, and to impose administrative and civil sanctions on the offenders, whether the Government has plans to introduce a comprehensive trade practices statute as recommended; if it has, of the relevant timetable; if not, the reasons for that?
(a) Depending on the types of products advertised and the industries in which the services advertised are provided, there are at present a number of applicable ordinances and codes of practices regulating the contents of advertisements.
Advertisements on television and radio are regulated by the Generic Code of Practice on Television Advertising Standards and the Radio Code of Practice on Advertising Standards issued under the Broadcasting Ordinance and the Broadcasting Authority Ordinance. The two codes stipulate that advertisements should not contain descriptions, claims or illustrations that depart from truth.
Besides, advertisements of various products and services are also regulated by specific legislation and codes of practice. Examples include the Telecommunications Ordinance, the Public Health and Municipal Services Ordinance, the Estate Agents Ordinance, the Non-local Higher and Professional Education (Regulation) Ordinance, the Education Ordinance, the Securities and Futures Ordinance, and the Banking Ordinance. Such legislation prohibits misrepresentations or false, misleading or deceptive claims in advertisements. Separately, the Trade Descriptions Ordinance prohibits the application of false or misleading trade descriptions to any goods. The Undesirable Medical Advertisements Ordinance prohibits advertisements of medicines, surgical appliances or treatments for the prevention or treatment of certain diseases or conditions that are specified in the Schedules to the Ordinance.
In addition, the Association of Accredited Advertising Agents of Hong Kong has formulated a Code of Practice regulating advertisements produced by its members. The Code stipulates that advertisements must be "legal, decent, honest and truthful", and shall not "contain any descriptions, claims, or illustrations which directly or by implication mislead about the product or service advertised". Any member of the Association who fails to comply with the Code will be subject to sanctions according to the rules of the Association.
The Consumer Council has also published two codes of practice and guidelines that encourage good enterprises to assume social responsibility and remind them to ensure that their promotional materials and advertisements are truthful, unbiased and sensible, without any misleading elements, and are compliant with requirements stipulated in related legislation or rules. Consumers can then be in a better position to make informed decisions whether to make purchases. Separately, the beauty industry has formulated its own Code of Practice recommending best practices for adoption by its practitioners, with a view to enhancing service quality and consumer confidence. The Code also encourages the use of good promotion practices and transparent pricing, etc.
Apart from formulating and enforcing relevant legislation and codes of practice, strengthening consumer education and making available more information are equally important. The Consumer Council regularly collects consumer market information and conducts investigations and tests on different products and services, and disseminates its findings through press conferences and its monthly magazine CHOICE. These measures provide the public with independent and reliable information, and would in turn help consumers make smart choices.
(b) The number of complaints relating to misleading statements or misrepresentations in advertisements received by enforcement agencies, as well as the enforcement statistics from 2006 to 2008 are in the Annex.
(c) The main recommendation in the report published by the Consumer Council is to enact a cross-sector statute to prohibit the use of unfair trade practices by traders. The proposed statute applies to all products, services and industries, and regulates all related practices before, during and after transactions. Its coverage is wide and deep, and affects many pieces of existing legislation and codes of practices relating to consumer protection. We have to examine the issue meticulously, including the impact of the proposed statute on the business sector and consumers. We have not come to any conclusive view on the Consumer Council's recommendation.
Wednesday, February 4, 2009