Unfair sales tactics under microscope

PUBLISHED : Monday, 08 October, 2007, 12:00am
UPDATED : Monday, 08 October, 2007, 12:00am

Consumer laws being reviewed

A new legislative proposal to crack down on unfair sales practices and misleading advertising will further protect the public, the new chairman of the Consumer Council says.

The council was also looking at a new definition of 'consumer', and consumer education for mainland tourists and the elderly, Anthony Cheung Bing-leung said.

Professor Cheung, also an executive councillor, was this month appointed as the new president of the Hong Kong Institute of Education.

He said a council working group was reviewing consumer protection laws and targeting the business practice of using misleading information or advertisements as 'bait' to lure customers to make a purchase.

The council said the areas being looked at included misleading claims, aggressive sales practices, misleading or deceptive advertising, and poor after-sales service.

'At present, there are grey areas in so-called unfair practice. For example, a shop may put out a price at HK$1,000 for a product on its display window, but once you get in, they tell you only more expensive goods are available. We are also looking at misleading claims in advertisements and misleading information,' Professor Cheung said.

The working group will present a report to the government by the end of the year.

It is also looking at experiences in Australia, Britain and Singapore where unfair sales practices are regulated.

For example, in Australia, businesses have to issue a 'corrective' advertisement if the original is misleading.

'It is not easy to define what an unfair practice is. We have a group of legal experts in the working group, and we are considering the legal framework and which agencies should be responsible for the enactment,' Professor Cheung said.

Professor Cheung, appointed in July to chair the council, said he was also concerned about the number of complaints against pay-television companies.

Cable TV received up to 3,000 complaints against its hotline services in June, one month after it lost its exclusive live-broadcast rights for the English Premier League to Now TV. Some customers were angry about the difficulties encountered when trying to terminate the service.

Without naming any operator, Professor Cheung said the situation had improved since the council had taken the case to 'an operator's senior management'.

'We have told them that if things do not improve, the council will take action. Then they have come up with some improvement measures.'

He also advocates a cooling-off period for customers who must commit to a long-term service contract.

The council will test the quality of more services that are popular among Hongkongers, such as fitness and yoga programmes, and travel packages.

And with more mainlanders visiting Hong Kong, the council has taken up a new role to provide them with information.

Professor Cheung said his role as an executive councillor would not bring conflicts of interest to his work at the council.

'It will be unlikely that a government policy will be opposed to the council's position.

'Perhaps it cannot achieve 100 per cent what the council wants and I won't find it very surprising.'

Under the spotlight

The main areas the Consumer Council will examine

Improper practices Example: a pay-TV salesman promises new customers a trial period, but contracts are automatically renewed without the company explicitly checking with the customer.

Aggressive sales practices Example: a shop selling dried seafood harasses and coerces customers to buy products, with staff going as far as surrounding the customer and even shutting the door to prevent them leaving.

Deceptive advertising Example: an advertisement claims a machine or treatment can make someone taller, a claim with no basis in fact.

Source: Consumer Council