Exco endorses formation of an anti-trust agency

PUBLISHED : Wednesday, 30 April, 2008, 12:00am
UPDATED : Wednesday, 30 April, 2008, 12:00am

Fair-competition law moves closer

Hong Kong has moved a step closer to introducing a broad fair-competition law. The Executive Council yesterday endorsed proposals to establish a high-level commission and a tribunal for enforcement and adjudication.

Breaches of the law would be punishable by fines of up to HK$10 million.

The proposed legislation would not bind the government, however, in order to avoid confusion arising, officials said.

A second round of consultation on a fair-competition law was delayed when top officials questioned whether the provision of subsidised housing and other public services might be seen as unfair competition, and therefore challenged.

One official said: 'There is no question of the government competing with the business sector. All the services we provide are essential. We believe exempting the government would have majority support.'

The government proposes an independent commission for fair competition be formed. It would issue guidelines to different sectors on how to comply with the law.

It would have an executive arm able to initiate investigations or act on complaints. A tribunal would adjudicate on complaints, the official said.

The government is understood to have drafted proposed legislation.

Next week, Secretary for Commerce and Economic Development Frederick Ma Si-hang would release a brief document for public consultation that would 'spell out our clear position on the proposals, and explain in layman terms the spirit of the legislation', the official said.

'We hope it will help ease the worries of the business sector.'

The business sector has voiced concerns that many of its trade practices would fall foul of a sweeping anti-trust law. The source said the bill was expected to be introduced in the next Legislative Council session, following the election of a new legislature in September.

Civic Party legislator Ronny Tong Ka-wah disagreed that all government activities should be above the law.

He pointed to the government's ownership of the MTR Corporation and the Trade Development Council, which he said had implications for fair competition in transport services and the trade-fair business.

'The government should review objectively whether its services affect fair competition,' he said.

Chinese Manufacturers' Association president Paul Yin Tek-shing said small and medium-sized enterprises were worried they would not have the resources to fight large consortiums in court.

He called for a grace period for businesses to adapt to the law before it was enforced.