Politics

New law fails to stop overcharging

Consumers still being misled despite the amended Trade Description Ordinance

 

Miss Ng, 49, once found that the checkout price for a pack of discounted biscuits she purchased in a supermarket was three times higher than the displayed price. She immediately informed the cashier and was given a refund.

Hers is not the only case. The Consumer Council bought 252 discounted items from 15 supermarkets in June and July this year and found price discrepancies for 18 products.

The Council has warned retailers against displaying so-called "strike- through price" – higher prices crossed out on price tags to mislead consumers - as they would be at the risk of violating the amended Trade Descriptions Ordinance, which prohibits the dissemination of any false, misleading or incomplete information on goods or services. The maximum penalty on conviction is a fine of $500,000 and imprisonment for five years.

But Mr Ronny Tong Kah-wah, a lawmaker representing the New Territories East constituency, said the Ordinance cannot protect consumers' interests at all, as there is no real deterrence and the prosecution rate has been low.

The Customs and Excise Department, Office of the Communications Authority and Council Council received 2,955 complaints from July to December last year, but only six complaints investigated led to prosecutions. This put the rate of prosecution at 0.2 per cent over a 6-month period.

Mr Tong said as the departments concerned do not really treat the breaches as a criminal offence, they have to take a long time to process customers' complaints. He said a problem of the current Ordinance is that it does not have provisions to monitor the civil compliance-based enforcement mechanism.

Customers often find that the checkout price of a product is higher than the displayed price.

While consumers are facing the risks of being misled, the retail industry also confuses the Ordinance with trademark issue.

Last year, Mr Jim Coke, a coffee importer who imports Jamaica Blue Mountain Coffee, filed a complaint to the Customs and Excise Department regarding the allegedly misleading product descriptions of two coffee makers and one retailer, who described and packaged their coffee with the trademarked words ‘Jamaica Blue Mountain' without actually holding the trademark or obtaining a licence to do so.

Mr Coke said that he cannot believe that the Department only responded to such a "serious complaint" with just a few lines declining to investigate further without explaining why the coffee makers did not breach the Ordinance.

"It indeed affects my business because counterfeit, unlicenced and

parallel products take significant market share due to their pricing structure," said Mr Coke.

Mr Tong explained that the purpose of the Ordinance is to protect consumers from being misled about products, and it is not designed to protect the holders of trademarks.

He also pointed out that all the enterprises are willing to comply with the Ordinance because most businesses in Hong Kong are finding ways to make money and dodge it.

Echoing Mr Tong, Mr Coke added that for businessmen who run small businesses, it is extremely hard to take advantage of the benefits of the Ordinance as it appears that the interests of bigger players are served instead of much smaller firms.

By Kumiko Lau

Edited by Tiffany Lee

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