Debt collection regulations rejected
Law Reform Commission recommended rules on harassment, data sharing, but Security Bureau says it sees no need
The government has rejected recommendations by the Law Reform Commission to regulate debt collection agencies, three years after they were made.
The Security Bureau yesterday issued a report responding to the commission's recommendations to create a criminal offence of harassment of debtors, to institute a statutory licensing scheme for debt collectors and agencies, and to regulate the sharing of consumer credit data.
The bureau claimed existing legislative provisions were sufficient to combat 'most of the undesirable debt collection activities', citing criminal sanctions against intimidation, assault, blackmail and letters threatening murder.
It said the administration would consider other illegal activities, such as stalking, in a wider context once the commission's report on stalking is published, rather than enacting a stand-alone law for debt collectors.
It also decided that there was insufficient justification for the statutory licensing system recommended in the commission's report.
'Judging from the operational experience of the enforcement agencies, delinquent operators are unlikely to come forward to license their operations,' the government report said. 'The system would be likely to cover only prudent and ethical market operators, who did not engage in abusive activities even in the absence of a licensing regime.'
On the sharing of consumer credit data, the report noted this had already been acted upon by the Privacy Commissioner's office.
Legislators in December asked why it was taking the government so long to respond to the commission's report, issued in July 2002.
The number of complaints against debt collectors rose to 22,417 last year, from 20,436 in 2003. Of these, 20,429 were reports on matters not covered by law, such as nuisance telephone calls, nuisance visits and 'low-threat' cases unlikely to escalate into criminal activities.
'The administration has been adopting a multidisciplinary approach in addressing the various issues arising from, and related to, delinquent debts,' a Security Bureau spokesman said. 'The agencies concerned are already taking proactive measures to tackle the problems associated with debts from different perspectives.'
Eleven government agencies participated in the consideration of the commission's recommendations, including the police, the Companies Registry, the Hong Kong Monetary Authority and a number of policy bureaus, the spokesman said.
Legislator Albert Chan Wai-yip accused the government of not wishing to upset influential businesses that use debt collectors.