Research on consumer policy issues, trade practices and legal protection will be the main focus of work for the Consumer Council in the year ahead.
The research will provide much needed crucial information and data to improve consumer protection as the marketplace becomes increasingly globalized and complex.
Consumer education will also be a priority - to enable consumers themselves to safeguard their own rights and interests in the purchase of goods and use of services. In addition, the Council will continue to develop its role as advocate for competition.
These targets for the new year were outlined by the Chairperson of the Consumer Council, Ms. Anna WU, today (January 8) at a year-end press briefing.
Consumer Complaints
1997 has seen a substantial rise in the number of consumer complaints totalling 11,535 cases and making it the highest on record. The previous record high was 10,045 in 1994.
Compared with 1996, there were 31% more complaints this year than the previous year (8,805).
The rise is probably due to the current economic downturn as the bulk of the increase occurred at the latter half of the year.
The major categories that recorded increases concerned:
- electrical/telecom appliances 1,763 cases up 21%
- furniture 976 cases up 29%
- properties 777 cases up 20%
Other notable developments in complaint categories were:
- modelling agencies 638 cases up 215%
- dried seafood/ginseng shops 431 cases up 54%
- telecommunications 421 cases up 39%
- beauty saloons 100 cases up 88%
Trade Malpractices
The rising trend in consumer complaints is likely to continue into 1998. The Council is particularly concerned over a recent spate of trade malpractices in which large numbers of consumers are affected. This clearly demonstrates a very real need for legislation against such malpractices.
The Council considers that malpractices bordering on "consumer fraud" need to be carefully studied. There is a need for legislation to provide for this new category of "consumer fraud" in order to provide effective protection to consumers in cases where the interest of a large number of consumers is involved.
An Overall Consumer Protection Law
In this connection, the Council has initiated preliminary study of a proposal for an overall consumer protection law.
Although there now exists a substantially expanded body of consumer protection legislation, addressing selected areas of concern, the current piece-meal approach is considered not sufficient to cover all areas and not conducive to the promotion of trader and consumer education.
The enactment of an overall consumer protection law will help remove uncertainty and enhance greater awareness and understanding of the legislative protection afforded to the consumer public.
Areas of concern due to inadequate legislative protection include:
- Misleading advertisement
Current legislation only deals with misleading advertisements such as undesirable medical advertisement and false trade description but there is no general advertising law covering other areas. - Inadequate information
There is a need for the supply of accurate and adequate consumer information such as price display and product composition labelling. - Consumer problems arising from Internet shopping
Issues such as genuineness of offer, product quality, security of payment and privacy issues, etc, have been raised. - The lack of law governing product and service liability
Consumers have difficulties in determining the parties responsible for the safety and quality of products. The Law Reform Commission is looking into product liability. - Insecurity of consumer deposits and gift coupons
There is no protection for the redemption of such charges as membership for health clubs, cake coupons in the event of closure of a company.
Consumer Legal Action Fund
The key role of the Fund is to obtain redress through legal action or the threat of legal action for affected consumers and by doing so, has created a deterrence to other traders who become more ready to cooperate and settle consumer complaints.
In 1997, the Fund considered and pursued 6 groups of cases which applied for CLAF assistance. Whilst some of these cases proceeded smoothly, the Fund has encountered difficulties in cases where judgement was successfully obtained in court but because the company in question did not possess any asset, redress was not yet obtained in the end.
Advocate for Competition and Trade Practices
As an advocate for competition, the Council's task will be to continue to receive complaints and monitor trade practices.
The Council will channel the information to the Government Competition Policy Advisory Group (COMPAG) and other relevant departments. It will also work closely with COMPAG on its proposed policy statement on the objectives of and guiding principles on promoting competition.
In addition, the Consumer Council will devote efforts to introduce voluntary self-regulatory codes of practice beneficial to both businesses and consumers.
The Council will, in co-operation with the Government and the business, develop a benchmark code setting out the principles to which such codes of practice should conform. Such principles should seek to enshrine good business practices conducive to open competition and fairness.
Consumer Education and Research and Testing
Another area of work which the Council attaches great importance relates to its consumer empowerment objective and the promotion of responsible and sustainable consumer behavior. With rising consumer awareness of their rights, consumers are encouraged to take the appropriate precautionary steps and measures for their own protection to avoid unnecessary disputes afterwards.
In 1997, the Council recorded 245,285 enquiries for consumer information and advice for its consumer advice service, representing a slight 4% increase over the previous year. This is encouraging as pre-shopping advice will help consumers to avoid the pitfalls and to procure a more satisfactory purchase.
Over 200 consumer education activities in the form of talk and exhibition etc. were also organized by its 16 Consumer Advice Centres throughout Hong Kong in 1997. A new consumer information resource centre is expected to open in 1999. It will be erected in a 3-storey building in the heart of Tsimshatsui in Kowloon.
Consumer education work is strongly supported by its core services such as research, testing, survey and the publication of 'CHOICE' which will continue their functions of marketing monitoring and dissemination of independent and impartial information and guidance to consumers. Results of the Council's wide ranging research on goods and services attracted great public attention in the year under review.
In the year ahead, more emphasis will be placed to surveying changes in the behaviour of buyers and sellers in the marketplace with the aim of assessing more clearly the consumer needs.
As overseas reports on unsafe products are now available through the Internet, the Council faces considerable challenge in responding to queries concerning availability of these products in the local market and implications for consumers. The Council will deploy resources catering to such need for immediate attention.