Reports of unfair sales practices surge to 3,000

Customs chief says only 13 cases prosecuted as most incidents occurred before new law came into effect

PUBLISHED : Monday, 24 March, 2014, 3:51pm
UPDATED : Tuesday, 25 March, 2014, 3:45am

Thirteen cases of alleged sales malpractice have been or are being hauled before the courts out of more than 3,000 complaints received since new consumer protection laws came into effect in July.

Among the prosecutions was one involving Wellcome supermarket, which was last month fined HK$10,000 for a "special offer" on potato chips that were in fact cheaper if bought without the offer.

In addition to the 13 charges, there are two cases being investigated which are alleged to involve pre-payments by customers.

Customs and Excise Department Commissioner Clement Cheung Wan-ching outlined the charges yesterday when telling lawmakers that his officers were also keeping a close eye on attempts to trick the elderly into buying health products.

Dr Fernando Cheung Chiu-hung, of the Legislative Council's panel on economic development, noted the small number of prosecutions compared with the many complaints.

Cheung said many of the complaints were about incidents that occurred before the amended Trade Descriptions Ordinance came into effect on July 19 and hence could not be prosecuted based on the tighter rules. In 2012, only 581 reports were received, he said.

"Violation of the ordinance also involves criminal liabilities, to which there is a high threshold on investigation," he added.

Customs were also careful to prioritise cases to be pursued, Cheung said.

"Prosecution takes time because of the lack of precedents," he said. "We need to be careful with the selection of cases and give priority to representative ones."

The ordinance makes it illegal to engage in unfair sales practices or make misleading descriptions.

On February 12, Wellcome pleaded guilty to possessing goods with a false trade description. A brand of chips at an outlet had a price tag reading "standard price HK$5.50, discounted price HK$11.50 for two".

Lawmakers on the panel doubted if the fine would deter one of the city's two biggest supermarket chains from malpractice. But Cheung replied: "The effect on its reputation is bigger than the actual fine."

Since July 19, customs has launched detailed investigations into 896 complaints.

The department sent warning letters to owners and sales staff in 27 cases, urging them to comply with the new laws. It closed 977 cases that were found to have not contravened the ordinance.