Law sought to boost rights of consumers

PUBLISHED : Tuesday, 26 February, 2008, 12:00am
UPDATED : Tuesday, 26 February, 2008, 12:00am

Watchdog proposes legislation to give the public better protection

The Consumer Council has proposed wide-ranging new legislation to protect the public against unfair, misleading or deceptive conduct in the marketplace.

The new laws would cover areas such as false descriptions of goods, misleading advertisements, aggressive or high-pressure tactics, and unfair terms in contracts.

Consumers would be allowed to sue and have better access to redress, either through a new consumer tribunal or expanded legal aid funds. The council said enforcement could be handled by a new agency, the Customs and Excise Department or itself.

In a report submitted to the Commerce and Economic Development Bureau yesterday, the council called for a cross-sector trade practices statute to cover consumer goods and services. Current legislation is mainly limited to specific sectors, such as the Telecommunications Ordinance.

Council chairman Anthony Cheung Bing-leung said: 'It is not a proposal that will only benefit the consumer. We believe that, in a healthy market, there should be fair trading between traders and consumers, and sellers and buyers.'

The council is relatively powerless to tackle consumer complaints. Its functions are largely limited by its ordinance to gathering information, receiving complaints and encouraging businesses to establish their own codes of practice. It also administers the Consumer Legal Action Fund, which was set up in 1994 to help consumers take legal action against unscrupulous traders.

Welcoming the 180-page report - 'Fairness in the Marketplace for Consumers and Business' - a government spokesman said the recommendations would be carefully examined before the public was consulted later this year.

He said the government hoped the Trade Descriptions Amendment Bill currently being discussed in the Legislative Council could be enacted as soon as possible.

Lawmaker Fred Li Wah-ming said the existing Trade Descriptions Ordinance - which includes laws ensuring goods and services are offered on fair terms - did not cover situations such as slimming classes that do not yield the advertised results.

'Before, there was nothing the Consumer Council could do to help these people,' he said.

Mr Li, who is a Consumer Council committee member, also wants a cooling-off period of at least three days in transactions that involved the signing of prepaid plans.

Mark Williams, associate professor of law at Polytechnic University, said there was some overlap between laws protecting consumers and the government's planned anti-trust competition law, which targets cartels and monopolies. But he said they should be different laws.

'There is difficulty with covering consumers in a competition law, even though [both types of laws] are essentially about ensuring accurate market information,' he said.

Professor Williams said that when Taiwan set up its Fair Trade Commission 15 years ago, it was swamped with consumer complaints and was unable to deal with anti-trust matters. However, Australia's Trade Practices Act covers both consumer protection and anti-trust matters.

Hong Kong Retail Management Association chairman Bankee Kwan Pak-hoo said he supported consumer protection but warned against unnecessary legislation.

The report was initiated in response to the then financial secretary's call in the budget last year 'to review existing measures to protect consumer rights'.