Hong Kong consumers deserve fairer deal in goods and services contracts

As consumers, we all enter into contracts to buy goods and services. But how often do we get to negotiate the terms of those contracts? They are almost always set out in standard form, on a "sign here" and "take it or leave it" basis. Examples include those for television services, gym memberships and beauty salon packages. And, in cases where we have taken a lot of time to discuss our "package", we often feel pressure to sign.

But if we take a closer look at the terms we have just agreed to, we will surely appreciate that they often seem too one-sided, in favour of the supplier of the goods or service. Other than terms which require the consumer to either indemnify the supplier for any losses caused by the consumer's negligence, or to limit or exclude the supplier's liability to the consumer for breach of contract, negligence or misrepresentation (for which there is adequate legislative protection under the current law), there are a multitude of other potentially unfair terms.

For example, there may be a term which states that the service supplier can unilaterally vary the terms of the contract without notifying the consumer, that certain (excessive) fees are payable for early cancellation of a contracted service, or that the supplier is entitled to automatically renew a contractually expired service.

So can we challenge these other terms? Only if they are "unconscionable". Is that the same as "unfair"? In the UK, there is legislation protecting consumers from "unfair" contract terms. But, in Hong Kong, the equivalent legislation - the Unconscionable Contracts Ordinance - protects consumers from "unconscionable" terms. We may ask how they differ. Does "unconscionable" mean there is a higher test in Hong Kong, whereby the contract term would have to be something more than merely unfair or unreasonable - something that, instead, goes against the conscience and is immoral? If so, it would make it more difficult to target unfair contract terms using the ordinance.

Why does the legislation not protect consumers from "unfair" terms, as does the UK legislation?

Since coming into force 19 years ago, there have only been four successful challenges to unfair terms under the ordinance. This difference in terminology - "unconscionable" as opposed to "unfair" - may be why. Moreover, in contrast to the UK's Office of Fair Trading, why does Hong Kong lack any enforcement body that can take representative action on behalf of local consumers to challenge unfair (or even "unconscionable") terms? The Consumer Council has a statutory function to "protect and promote the interests of consumers" - so why does it disavow any responsibility to take representative action on behalf of aggrieved consumers? Why is there no other body that can do this?