Hong Kong, 26 June 2017: Reform of Hong Kong’s consumer protection legislation is needed to improve the current imbalance between businesses and buyers, says Boase Cohen & Collins Senior Partner Colin Cohen.
The territory lags behind overseas jurisdictions such as the United Kingdom, Australia and mainland China in safeguarding the rights of consumers, he pointed out.
Mr Cohen was responding to news that the Consumer Council is considering new legislation that will enable buyers of certain goods and services to cancel deals and obtain refunds. The council will publish a research report later this year.
“It is clear Hong Kong lags behind other developed countries in consumer protection. As such, an urgent reform of the current consumer protection regime is necessary to reduce exploitation of buyers and to redress the imbalance in bargaining strength between businesses and customers,” said Mr Cohen.
“In Australia, they have a 10-day cooling-off period on any sale that was unsolicited – usually through door knocking or telemarketing. In the UK, consumers who enter into ‘distance’ contracts with traders can cancel within 14 days. In mainland China, consumers who buy goods through the internet, television, telephone or by mail order can return the goods within seven days without giving any reason.
“Hong Kong’s legislation on consumer protection, on the other hand, is insufficient. At this moment, cooling off periods only apply to life insurance products.”
Attempts to include a cooling-off period as part of the Trade Descriptions Ordinance enacted in 2013 were dropped amid opposition from business. The Consumer Council last week said it would look at different cooling-off periods for different sectors rather than applying one rule to all goods and services.
Fitness centres and beauty treatment clinics have been highlighted as the sort of services requiring better consumer protection following reports of customers being coerced into buying expensive courses.
But Mr Cohen believes simply introducing legislation may not be enough – there is an argument for giving the Consumer Counsel stronger powers.
“The council is simply a watchdog advocating for consumer interests, it is not a law enforcement agency. Cases are handed to the Customs and Excise Department for prosecution,” he said.
“There is the suggestion that the Consumer Council’s remit could be widened or that an enforcement body, similar to the Competition and Markets Authority in the UK, should be set up to enforce consumer protection legislation by pursuing civil claims on behalf of aggrieved customers.”