New consumer sale guidelines likely to confuse enforcers

The changes in the guidelines for customs officers on enforcing new consumer protection laws will make it harder to clamp down on confusing price tags put up by retailers, lawmakers warn.

At the end of last year, the Customs and Excise Department began a public consultation on its draft of enforcement guidelines for the amended Trade Descriptions Ordinance - which has had its scope expanded to cover services - with the aim of combating unscrupulous sales practices.

The draft guidelines asked traders to use terms such as "sale", "original price" or "reduced price" with caution, so as to eliminate the practice whereby merchants initially raise the price of goods or services only to later discount them and pretend they are on sale.

"As a best practice, it is advised that the previous higher price should be quoted only if it has been applied to the same goods or services for at least seven consecutive days in the same shop location immediately preceding the day on which the lower price is introduced," the guidelines stated.

The seven-day recommendation was dropped in the final version of the guidelines, obtained by the South China Morning Post. Instead, it will be up to a court to determine if an original price has been applied to a product for an "unreasonably" short period.

The change came after criticism by retailers, who said the requirement was rigid and impossible to enforce, especially for those shops which sell fresh products.

But dropping the clause would make it more difficult to combat confusing price tags used by supermarkets, lawmaker Wong Kwok-hing said.

Promotions at supermarkets have always been a subject of scrutiny. While the major chains frequently put up advertisements for "bargains" on Fridays, the actual prices of products are often higher than those on weekdays.

"Original prices" and "reduced prices" indicated on price tags change from day to day, making it hard for shoppers to determine whether a current price is higher or lower than a week ago.

It will be hard for frontline customs officers to prosecute anyone if they do not have concrete guidelines, Wong said. "Even if the court can judge what would make a misleading price tag, it cannot exercise its power if no cases land in court," he said.

Civic Party lawmaker Ronny Tong Ka-wah said the change would leave both customs officers and retailers clueless about what constitutes an unreasonably short period of time.

Thomas Cheng, associate professor of law at the University of Hong Kong, said it would be possible for supermarkets to argue that constant changes in prices are an industry norm and that what counts as an unreasonably short period in that industry should be different from others.