Rules for competition law challenged

PUBLISHED : Wednesday, 01 June, 2011, 12:00am
UPDATED : Wednesday, 01 June, 2011, 12:00am


Guidelines issued to clarify aspects of the proposed competition law may have done the opposite in a Legislative Council bills committee meeting yesterday: some lawmakers questioned the need for them.

The 'Guidelines on the First Conduct Rule' offers 12 examples of possible breaches of the first of the measure's three conduct rules.

They say that business people may not directly or indirectly fix prices, rig bids, share markets, limit or control production or investment, fix trading conditions, engage in joint purchasing or selling, share information, exchange price information or non-price information, restrict advertising, or set technical and design standards or terms of membership and certification.

Some lawmakers questioned the terms of the guidelines, and others saw no point in having the provisional guidelines at all, since they had no legal power. Some lawmakers threatened to block the bill altogether.

'Can you include these guidelines in the law?' Dr Leung Ka-lau, of the medical sector, asked the government. 'Many people will find them useful.'

Linda Lai Wai-ming, deputy secretary for commerce and economic development, said that would not be ideal because the guidelines were not designed for that. They were meant to be a plain-language guide to the new law.

Picking apart specific guidelines, Jeffrey Lam Kin-fung, representing the commercial sector, told a Legco committee: 'Even sharing information is a violation. This would scare many businesses off.'

He added: 'The government doesn't understand what society is concerned about. This new set of guidelines worries me.'

Lai explained that 'just sitting together and chatting doesn't break the law. But exchanging information, when it reduces uncertainties inherent in the process of competition, may.'

Lawmakers representing business interests said the guidelines could inadvertently handcuff the business environment in a city that takes pride in its economic freedom.

The law, which has yet to be taken up by the full Legislative Council, is not expected to go into effect before 2014 at the earliest.