Actions of Octopus were ethical and it did not break any laws
The Hong Kong Direct Marketing Association has followed the story of the Octopus card situation with great interest and concern and feels compelled to add commentary, context, and perspective that has been sorely lacking in reports. Reasoned analysis is required rather than sensationalistic reporting and related commentary, which only inflame public opinion unnecessarily. Members of the association follow the law, pay great attention to customer feedback, and provide easy convenience and privacy to consumers.
Nothing was done illegally or immorally. We would add that nothing was done unethically as well. When a commercial transaction takes place, both parties have responsibilities. On the company side, the responsibility is to fully disclose, in accordance with all appropriate laws and guidelines, the terms and conditions, including the right of the consumer to opt out. The consumer has a responsibility to read the terms and conditions prior to agreement. Since the company in question fulfilled its responsibility on disclosure, it acted ethically.
Successive transactions bring new opportunities to opt out, including with the individual marketing partners. This system has worked well with the general public as evidenced by the small number of actual complaints received by the privacy commissioner as well as our members. In fact, on a percentage basis, the complaint ratio for all issues, not just privacy-related, is below 1 per cent for all member companies. And that's measured against millions of annual transactions.
Consider also the tens or even hundreds of thousands of consumers who received benefits, including millions of dollars in insurance benefits they would not have received were it not for the marketing partner relationships put in place by Octopus and others. Have they been harmed? We don't think so. They signed up voluntarily and presumably knew they would be receiving benefits from partner companies. And, for the record, no data was ever 'sold', since ownership of the data was never transferred, rather shared in exchange for fees.
The business model of sharing data with marketing partners is a common worldwide practice that has benefited many people, consumers and companies. Hong Kong has long been regarded as one of the best places for business because of its regulatory climate, which leans heavily on industry self-regulation. Let's keep it that way; it works.
Many thousands of people in Hong Kong are employed directly in our industry, and many thousands more are employed in the service sectors that support direct marketing. To threaten the livelihood of these people based upon what has been reported would be a serious mistake.
The Direct Marketing Association and its members remain committed to serving the public with business practices that observe the highest standards of ethical, legal and moral principles. To do so, we rely on self-regulation, consultation with government bodies and a strong sense of community and responsibility to Hong Kong.
Eugene R. Raitt, chairman, Hong Kong Direct Marketing Association