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Competition review - What should I do?

Hogan Lovells

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Hong Kong December 14 2015

www.hoganlovells.com "Hogan Lovells" or the "firm" is an international legal practice that includes Hogan Lovells International LLP, Hogan Lovells US LLP and their affiliated businesses. The word "partner" is used to describe a partner or member of Hogan Lovells International LLP, Hogan Lovells US LLP or any of their affiliated entities or any employee or consultant with equivalent standing. Certain individuals, who are designated as partners, but who are not members of Hogan Lovells International LLP, do not hold qualifications equivalent to members. For more information about Hogan Lovells, see www.hoganlovells.com. © Hogan Lovells 2015. All rights reserved. © Hogan Lovells 2015. All rights reserved. Competition review – What should I do? With the Competition Ordinance in force as of 14 December 2015, businesses will inevitably be changing the way they have traditionally been run, or at least turn their minds to whether their practices are at risk of contravening the competition conduct rules. The following flowchart helps you identify whether your business is at risk in relation to your dealings with competitors. You can also use the checklist below to evaluate whether you are ready to face the new competition regime. Risk evaluation – Your dealings with competitors Do you know who most of your competitors are? Are your competitors also your business partners or customers? Do you have large frontline sales teams? Do you see your competitors at trade association meetings? Do you see your competitors at trade events? Do you meet your competitors in social settings? Do your topics revolve around pricing? Do you share information about future strategies? Do you discuss who should get what customers and locations? Do you agree to work together to achieve common goals? START YES YES RISK OF CONTRAVENING COMPETITION LAW! YES "A very open firm that shares resources and knowledge across practice areas and offices." Chambers Asia Pacific, 2015 "They have been able to co-ordinate well with the regulators to make sure the issue gets through." Chambers Asia Pacific, 2015 What should I have done by now?  Trained staff on the competition conduct rules most relevant to your business  Adopted a competition compliance policy aimed at identifying and mitigating risk and remedying any breach.  Reviewed any distribution, supply, agency, franchising and licensing agreements  Reviewed market survey or benchmarking practices  Reviewed joint buying practices  Reviewed membership of trade associations  Reviewed membership of informal networking groups  Reviewed joint ventures and other cooperation or partnership agreements  Reviewed pricing policies and strategies, in particular any controls on resale prices  Reviewed whether you may have substantial market power  Reviewed any tying and bundling practices  Reviewed any loyalty-related discount and rebate practices  Reviewed any exclusivity arrangements, including exclusive supply and purchase  Reviewed business model of selling only through a network of authorised retailers

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