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Legal Update

Introduction of Competition Bill Postponed

3 March 2009
Mayer Brown JSM Legal Update
The Hong Kong Government has postponed the introduction of its proposed new cross-sector competition bill, with a spokesperson from the Commerce and Economic Development Bureau ("CEDB") explaining that more time is needed to comprehensively consider a number of technical, legal and policy issues relating to the proposed law before its introduction. 
Full Update
The Government had previously stated that it intended to introduce the bill during the 2008/2009 Legislative Council session. Chief Executive Donald Tsang reaffirmed this commitment during his annual policy address in November 2008, after a three month public consultation process on the Government's competition law proposals reportedly found broad public support for the bill.
However, there had been mounting speculation over recent months that the bill would be delayed, following the postponement of several other legislative initiatives. Some commentators have speculated that the Government is reluctant to introduce the bill at a time when significant financial pressures are being felt by many business sectors in Hong Kong, although this has not yet been mentioned as a factor in the Government's postponement decision.
The Government's decision has received widespread criticism from a number of pan-democratic legislators, who consider consumers are being exposed to anti-competitive conduct of certain businesses such as supermarkets and gas stations. On the other hand, some legislators from the Liberal Party welcome the postponement saying the community has more urgent matters to deal with other than a competition law.
According to the CEDB, the bill may now be introduced in the 2009/2010 Legislative Counsel session. The delay affords businesses in the region more time to implement competition compliance initiatives and to conduct business reviews, to ensure they are well placed when new anti-competitive conduct prohibitions are introduced.
Additionally, firms with operations or sales on the mainland can focus their efforts on compliance with China's Anti-Monopoly Law, at a time when enforcement of the law is ramping up following the release of a number of new implementation rules and guidelines.
For further information, please contact:
Learn more about our Hong Kong office and Antitrust & Competition practice.

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