Competition Ordinance/Part 1

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HONG KONG SPECIAL ADMINISTRATIVE REGION

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Ordiance No. 14 of 2012

An Ordinance to prohibit conduct that prevents, restricts or distorts competition in Hong Kong; to prohibit mergers that substantially lessen competition in Hong Kong; to establish a Competition Commission and a Competition Tribunal; and to provide for incidental and connected matters.

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Enacted by the Legislative Council.

PART 1
Preliminary

1. Short title and commencement

(1) This Ordinance may be cited as the Competition Ordinance.

(2) This Ordinance comes into operation on a day to be appointed by the Secretary for Commerce and Economic Development by notice published in the Gazette.

2. Interpretation

(1) In this Ordinance—

“agreement” (協議) includes any agreement, arrangement, understanding, promise or undertaking, whether express or implied, written or oral, and whether or not enforceable or intended to be enforceable by legal proceedings;

“Commission” (競委會) means the Competition Commission established by section 129;

“Communications Authority” (通訊事務管理局) means the Communications Authority established by section 3 of the Communications Authority Ordinance (Cap. 616);

“company” (公司), in addition to the meaning given by section 2(1) of the Companies Ordinance (Cap. 32), includes a “non-Hong Kong company” within the meaning of that Ordinance and a company registered under Part IX of that Ordinance;

“company secretary” (公司秘書) includes any person occupying the position of company secretary, by whatever name called;

“competition authority” (競爭事務當局) means—

(a) the Commission; or

(b) the Communications Authority;

“competition matter” (競爭事宜) means any matter involving or having a connection with—

(a) a contravention or alleged contravention of a competition rule; or

(b) any decision relating to a competition rule, that has been made or is to be made under this Ordinance;

“competition rule” (競爭守則) means—

(a) the first conduct rule;

(b) the second conduct rule; or

(c) the merger rule;

“conduct” (行為) means any conduct, whether by act or omission;

“conduct rule” (行為守則) means—

(a) the first conduct rule; or

(b) the second conduct rule;

“confidential information” (機密資料) has the meaning given by section 123;

“contract of employment” (僱傭合約) means any agreement, whether in writing or oral, express or implied, under which one person (an “employer”) agrees to employ another and that other agrees to serve the employer as an employee, and also includes a contract of apprenticeship;

“director” (董事) includes any person occupying the position of director or involved in the management of a company, by whatever name called, and includes a shadow director;

“document” (文件) includes information recorded in any form;

“first conduct rule” (第一行為守則) has the meaning given by section 6;

“functions” (職能), except in section 130, includes powers and duties;

“funds of the Commission” (競委會資金) means the funds of the Commission, as specified in section 21 of Schedule 5;

“Government” (特區政府) does not include a company that is wholly or partly owned by the Government;

“information” (資料) includes information contained in a document;

“infringement notice” (違章通知書) means an infringement notice issued under section 67(2);

“investigation” (調查) means an investigation conducted under Part 3;

“leniency agreement” (寬待協議) means a leniency agreement made under section 80;

“member” (委員), in relation to the Commission, means a member of the Commission appointed under section 2 of Schedule 5;

“merger” (合併) has the meaning given by section 3 of Schedule 7 read together with section 5 of that Schedule;

“merger rule” (合併守則) has the meaning given by section 3 of Schedule 7;

“person” (人), in addition to the meaning given by section 3 of the Interpretation and General Clauses Ordinance (Cap. 1), includes an undertaking;

“President” (主任法官) means the President of the Tribunal appointed under section 136;

“reviewable determination” (可覆核裁定) has the meaning given by section 83;

“second conduct rule” (第二行為守則) has the meaning given by section 21;

“serious anti-competitive conduct” (嚴重反競爭行為) means any conduct that consists of any of the following or any combination of the following—

(a) fixing, maintaining, increasing or controlling the price for the supply of goods or services;

(b) allocating sales, territories, customers or markets for the production or supply of goods or services;

(c) fixing, maintaining, controlling, preventing, limiting or eliminating the production or supply of goods or services;

(d) bid-rigging;

Note—

See also subsection (2).

“shadow director” (幕後董事), in relation to a company, means a person in accordance with whose directions or instructions all the directors or a majority of the directors of the company are accustomed to act, but a person is not to be regarded as a shadow director by reason only that all the directors or a majority of the directors act on advice given by that person in a professional capacity;

“statutory body” (法定團體) means a body of persons, corporate or unincorporate, established or constituted by or under an Ordinance or appointed under an Ordinance, but does not include—

(a) a company;

(b) a corporation of trustees incorporated under the Registered Trustees Incorporation Ordinance (Cap. 306);

(c) a society registered under the Societies Ordinance (Cap. 151);

(d) a co-operative society registered under the Co-operative Societies Ordinance (Cap. 33); or

(e) a trade union registered under the Trade Unions Ordinance (Cap. 332);

“Tribunal” (審裁處) means the Competition Tribunal established by section 134;

“undertaking” (業務實體) means any entity, regardless of its legal status or the way in which it is financed, engaged in economic activity, and includes a natural person engaged in economic activity.

(2) For the purposes of the definition of “serious anti-competitive conduct”—

“bid-rigging” (圍標) means—

(a) an agreement—

(i) that is made between or among 2 or more undertakings whereby one or more of those undertakings agrees or undertakes not to submit a bid or tender in response to a call or request for bids or tenders, or agrees or undertakes to withdraw a bid or tender submitted in response to such a call or request; and

(ii) that is not made known to the person calling for or requesting bids or tenders at or before the time when a bid or tender is submitted or withdrawn by a party to the agreement or by an entity controlled by any one or more of the parties to the agreement; or

(b) a submission, in response to a call or request for bids or tenders, of bids or tenders that are arrived at by an agreement—

(i) that is made between or among 2 or more undertakings; and

(ii) that is not made known to the person calling for or requesting bids or tenders at or before the time when a bid or tender is submitted or withdrawn by a party to the agreement or by an entity controlled by any one or more of the parties to the agreement;

“goods” (貨品) includes real property;

“price” (價格) includes any discount, rebate, allowance, price concession or other advantage in relation to the supply of goods or services;

“supply” (供應)—

(a) in relation to goods, means sell, rent, lease or otherwise dispose of the goods, an interest in the goods or a right to the goods, or offer so to dispose of the goods or of such an interest or right; and

(b) in relation to services, means sell, rent or otherwise provide the services or offer so to provide the services.

(3) A note located in the text of this Ordinance is provided for information only and has no legislative effect.

3. Application to statutory bodies

(1) The following provisions do not apply to a statutory body—

(a) Part 2 (The conduct rules);

(b) Part 4 (Enforcement powers of Commission);

(c) Part 6 (Enforcement before Tribunal); and

(d) Schedule 7 (Mergers).

(2) Despite subsection (1), the provisions referred to in that subsection apply to—

(a) a specified statutory body; and

(b) a statutory body, to the extent that it is engaged in a specified activity.

(3) In this section—

(a) “specified” (指明) means specified in a regulation made for the purpose of this section by the Chief Executive in Council under section 5; and

(b) a reference to a statutory body includes an employee or agent of the statutory body, acting in that capacity.

4. Application to specified persons and persons engaged in specified activities

(1) The provisions referred to in section 3(1) do not apply to—

(a) a specified person; or

(b) a person, to the extent that the person is engaged in a specified activity.

(2) In this section—

(a) “specified” (指明) means specified in a regulation made for the purpose of this section by the Chief Executive in Council under section 5; and

(b) a reference to a person includes an employee or agent of the person, acting in that capacity.

5. Regulations

(1) The Chief Executive in Council may, by regulation—

(a) apply the provisions referred to in section 3(1) to—

(i) any statutory body; or

(ii) any statutory body, to the extent that it is engaged in an activity specified in the regulation; and

(b) disapply the provisions referred to in section 3(1) to—

(i) any person; or

(ii) any person, to the extent that the person is engaged in an activity specified in the regulation.

(2) The Chief Executive in Council may only make a regulation under subsection (1)(a)(i) or (ii) with respect to a statutory body if he or she is satisfied that—

(a) the statutory body is engaging in an economic activity in direct competition with another undertaking;

(b) the economic activity of the statutory body is affecting the economic efficiency of a specific market;

(c) the economic activity of the statutory body is not directly related to the provision of an essential public service or the implementation of public policy; and

(d) there are no other exceptional and compelling reasons of public policy against making such a regulation.

(3) In subsection (1), a reference to a statutory body or a person includes an employee or agent of the statutory body or person, acting in that capacity.