Private-enforcement remedy should be useful to all types of victims, Hong Kong's antitrust chief says

29 May 2018 8:00am
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24 May 2018. By Xu Yuan and Leah Nylen

Hong Kong’s government needs to think about making standalone private litigation useful to all types of victims if it is to include such a remedy in the city’s competition law, Brent Snyder, CEO of Hong Kong's Competition Commission, told MLex in an interview.

“The caveat that I would put on the private enforcement remedy is that it may not be enough just to say that a standalone remedy is available without thinking how it’s available," Snyder said.

The official said that while there are companies with sufficient means to engage in litigation, thought would need to be given to whether there are “litigation vehicles that would allow people who have been victims of mass harm-type cases like broad price-fixing investigations to have a meaningful remedy and make sure the procedures are there that allow for it,” adding that he is not suggesting there has to be a class action system.

Whether to make standalone private litigation available in Hong Kong’s competition regime is one of the three primary focuses of a review of the Competition Ordinance, which is scheduled for three years after the law came into effect in December 2015.

Commission Chairwoman Anna Wu has also publicly advocated for the government to be open to considering a standalone private enforcement remedy for Hong Kong.

“Private enforcement can provide a nice and effective compliment to public enforcement,” Snyder said, adding that it could serve additional enforcement purposes that may supplement the commission’s, provide further additional deterrence and give the commission more flexibility in allocating resources.

The review of the ordinance will also look at the possibility of having a cross-sector merger control regime. Snyder said lawmakers should also think about how a cross-sector merger rule should be applied in order to allow the regulator to focus its ability on mergers that truly have an impact in Hong Kong.

“It would be worthwhile thinking about whether there is even more that we could do beyond [a revenue threshold] to make an assessment as to whether the merger affects Hong Kong in a significant enough way to undertake a review of it,” Snyder said.

The third subject of the review will be the exemption of statutory bodies from the ordinance. Snyder said he understands the business community feels strongly that such an exemption should be removed. 

Removing the exemption is consistent with competition-neutrality principles that government and private actors that are engaged in the same commercial conduct should really be treated equally and be on a similar playing field, according to Snyder.

The commission has set up an internal working group to look through the ordinance to assess not only its position on the three items that the government has indicated it will be reviewing, but other issues on which it may propose changes to the government when asked for input.

One of the areas that could be improved is the consistency of the ordinance. Snyder said there are certain areas where there are slight differences between how the ordinance might treat conduct or undertakings in one instance versus another.

One example is that the existing rules allow an undertaking or an association of undertakings to apply for a block exemption order, but for an application for decision, only an undertaking is eligible.

Another proposed change that the commission is considering is to expand the use of infringement notices, currently only allowed in cases of serious anticompetitive conduct, to include a broader range of potential contraventions.

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