Report to pave way for major shift in government policy on competition A committee appointed by the government to review Hong Kong's competition policy is set to recommend a comprehensive law against unfair practices. The recommendations, to be made in a report in June, will put pressure on the government to make a major shift in policy. The Competition Policy Review Committee, headed by businessman Christopher Cheng Wai-chee, will also recommend setting up a statutory body with punitive powers to handle competition-related complaints, according to sources familiar with the committee's work. The recommendations will be included in a report to the Competition Policy Advisory Group headed by Financial Secretary Henry Tang Ying-yen. If adopted, they will bring about a major shift from the government's previous insistence on a sector-specific approach to tackling anti-competitive practices. The committee was set up by Mr Tang in June last year with a mandate to review the city's competition policy. Chief Executive Donald Tsang Yam-kuen gave further momentum to its work in his policy address last year by saying the committee would look into the need to introduce a cross-sector law. Under the committee's proposal, the drafting process for the new law would refer to the current market situation in four sectors - petrol supply, supermarkets, telecommunications and electricity, a source said. 'But the law will be cross-sector, instead of targeting a specific sector or only the four that have been mentioned,' the source said. 'The anti-competition law that now exists on the telecommunications sector shall become part of the new law,' the source added, referring to the provisions of the Telecommunications Ordinance. This would mean, for example, that any action by companies to make agreements to fix market prices or to restrict the supply of goods or services to competitors, would violate the law. The committee recommends turning the Competition Policy Advisory Group into a statutory body to handle anti-competition complaints. It would be given the power to impose sanctions and an appeal process supervised by the court would be set up. The advisory group is now dominated by government officials, but more outside professionals would be appointed if it were transformed into a statutory body. The government has come under pressure from the community to strengthen regulations to promote competition. One member of the review committee believes the administration is more willing to consider the issue, partly because of Mr Tsang's eagerness to disprove accusations of government collusion with the business sector. 'There are outside pressures for Mr Tsang to reconsider the issue. As most developed economies in the region have such legislation in place, Hong Kong risks lagging behind [our competitors] in this respect,' the member said. Consumer Council chairman Chan Ka-keung, who also sits on the committee, said he supported comprehensive fair-trade legislation rather than piecemeal measures applied to individual sectors. 'In the absence of substantial evidence, found according to an objective framework, one cannot point a finger at certain companies for monopolising the market,' Professor Chan said, citing a recently released consultancy report that found no collusion between petrol suppliers. The report will be discussed by the Legislative Council's economic services panel today. Professor Chan believes a cross-sector law could regulate pricing and commercial behaviour. Last week, Secretary for Economic Development and Labour Stephen Ip Shu-Kwan stressed that the government had an open view on the competition policy review.