The commencement dates for key provisions of the much anticipated Hong Kong Competition Ordinance (CO) have been announced by the Secretary for Commerce and Economic Development, Mr Gregory So.  The Competition Ordinance (Commencement) Notice 2012 (Notice) was published in the Government gazette on 23 November 2012 and is subject to negative vetting by Hong Kong’s Legislative Council, with any amendments to the Notice be made by 19 December 2012.1

As anticipated, Hong Kong’s new CO will be introduced in stages, with the first provisions coming into operation on 18 January 2013.  On this date, provisions relating to the short title, commencement, establishment and operation of the Competition Commission (Commission) and preparation of guidelines will come into effect.  Provisions relating to the formation and operation of the Competition Tribunal (Tribunal) will come into effect approximately 6 months later on 1 August 2013.

The composition of the Commission, in particular the appointment of a Chairperson (all of which are appointments by the Chief Executive) and appointment of the Chief Executive Officer (CEO) will be a significant step forward.  These appointments will provide useful insight as the Chairperson and CEO are ultimately responsible for determining the scope and direction of competition policy and enforcement in Hong Kong. 

Upon appointment of the Commissioners and Commission staff, it is likely that much of the Commission’s initial efforts will be focussed on preparing procedural and substantive guidelines (for example, on the operation of the conduct rules, block exemptions and conduct of investigations).  The guidelines will be subject to consultation by the public and the Legislative Council.  Given the nature of the guidelines, namely that they will be admissible in evidence in any legal proceedings if relevant to determining a matter that is at issue,2 businesses are advised to monitor developments and, if appropriate, engage in the public consultation process.

The Tribunal, to be established 6 months after the Commission, will consist of the judges of the Court of First Instance.  The Chief Executive will be responsible for appointing a President and Deputy President of the Tribunal.  The Tribunal may decide its own procedures and may follow the practice and procedure of the Court of First Instance in this exercise of its civil jurisdiction.

A spokesman for the Commerce and Economic Development Bureau has advised that during the transitional period, the Commission will also conduct publicity programmes to promote public understanding of the CO.3   Such initiatives are important as raising public awareness of competition issues has made it easier for competition authorities in other jurisdictions to obtain information from the public about breaches of competition law.  The spokesman added that the CO will only come into full effect when all the preparatory work is completed, a process estimated to take at least a year.4