Hefty deposit for mainland tour firms
Proposed guarantee of HK$800,000 may be too much for small companies, lawmakers say
Lawmakers fear that a higher guarantee deposit of HK$800,000 will be too much for travel agencies that bring mainland tourists to Hong Kong.
The capital requirement proposed by the government as part of an overhaul of the travel trade's regulation would be imposed by the new watchdog, the Travel Industry Authority, when it begins operating in late 2015.
The proposed deposit would be 60 per cent higher than that required for travel firms not operating mainland inbound tours.
Yesterday, tourism officials told the Legislative Council's economic development panel that the higher deposit had been proposed as a way of putting a stop to widespread malpractice in the industry. Hong Kong's tourism reputation in recent years has been hit by a spate of unpleasant incidents involving forced shopping and poor receiving arrangements for inbound tours.
All travel agencies bringing mainland tourists to the city would have to pay the HK$800,000 deposit, up from HK$500,000 now.
For new operators who do not cater to mainland inbound groups, the deposit would remain at HK$500,000. Existing firms in this category would not have to pay.
But tourism sector lawmaker Yiu Si-wing suggested that only travel agencies who had broken the rules should have to pay the deposit, as it would be too much for the smaller firms. "Small and medium-sized travel agencies would not be able to afford such a large amount. This will result in large companies monopolising the business," he said.
But Secretary for Commerce and Economic Development Gregory So Kam-leung said it was necessary to raise the deposit for such agents to improve standards in the sector. He said the government was discussing the policy with the industry.
The new authority will take over from the Travel Industry Council, a regulatory body formed by the trade, which critics say is not effective.
