Lawmakers voice fears over competition law

PUBLISHED : Tuesday, 29 June, 2010, 12:00am
UPDATED : Tuesday, 29 June, 2010, 12:00am

Some lawmakers fear the government's freedom to decide which of the roughly 500 statutory bodies should be exempt from the provisions of the proposed competition law will render the antitrust legislation ineffective.

The competition law, which has been years in the making, is designed to stamp out all economic activities that abuse or distort market competition. But the law is not expected to apply to the majority of statutory bodies, which carry out a wide range of economic activities and include the Airport Authority and the Trade Development Council.

The government is still determining which bodies to exempt and they will be added to the law later by way of subsidiary legislation, subject to the Legislative Council's scrutiny.

'There is no need at this stage to list the statutory bodies in the principal legislation. We only need to provide for an exemption authorisation or power in the bill,' Secretary for Commerce and Economic Development Rita Lau Ng Wai-lan (pictured) said.

But speaking at a Legco economic development panel meeting yesterday, Civic Party lawmaker Ronny Tong Ka-wah said the government was not above the law and the task of deciding which statutory body to exempt should be left to an independent competition commission.

'The matter should be left in the hands of the competition commission - that is let the competition commission decide whether the activity is in breach of the competition law and whether the statutory body should be exempted. If you don't do so, the government is just trying to protect the statutory bodies. The administration just tries to exempt itself and exempt the statutory bodies,' Tong said.

Fred Li Wah-ming of the Democratic Party said the government needed to clearly spell out the criteria it planned to use to determine which statutory bodies were exempt and which were not.

Under the proposed competition law, the commission can launch an investigation on its own initiative or because of a complaint or have a case referred for investigation by the courts or the government. If it decides to prosecute, the case will go to the competition tribunal.

The tribunal will have the power to impose fines and injunctions and appeals will be heard by the Court of Appeal.

The introduction of a competition law is expected to bring certain businesses under the spotlight, including supermarkets and operators of petrol stations.

Critics often point to the existence of the supermarket duopoly of ParknShop and Wellcome that controls more than 80 per cent of the local market and creates high barriers for new entrants.