The Hong Kong Competition Ordinance

Written By: and on FORENSIC ACCOUNTING NEWS, LITIGATION SUPPORT

The Competition Ordinance (Cap 619) (the “Ordinance”) was passed in June 2012 and came into effect on 14 December 2015. A breach of the Ordinance can result in the Competitions Tribunal ordering penalties against the infringing companies as well as requiring the infringing companies to pay damages to persons who have suffered loss or damage.

Specifically, the Ordinance prohibits “… conduct that prevents, restricts or distorts competition in Hong Kong, to prohibit mergers that substantially lessen competition in Hong Kong; …” through the following three rules.

  1. First Conduct Rule – prohibits anti-competitive agreements on various types of business conduct including price fixing, market sharing, bid rigging, and output restrictions;
  2. Second Conduct Rule – prohibits businesses with a substantial degree of marketing power from abusing that power by engaging in conduct that is anti-competitive; and
  3. Merger Rule – prohibits mergers between businesses which substantiation lessen competition in Hong Kong. At present, the Merger Rule only applies to mergers between telecommunications license holders.

However, at present the Competition Commission (the “Commission”), the authority responsible for enforcing the Ordinance, has only commenced proceedings in the Competitions Tribunal against companies allegedly in breach of the First Conduct Rule.

How JLA can assist?

Our forensic accounting team comprises of a diverse group of experienced professionals from various backgrounds.

If you are making a complaint it is worth nothing that the Commission would require sufficient supporting documents to initiate the investigation. We can assist you to prepare the relevant evidence to support your complaint by:-

  • conducting forensic and statistical analyses to extract relevant evidence to support your complaint;
  • calculating any loss or damages incurred; and
  • preparing an independent expert report.

In the event that you are being targeted by the Commission, we can assist you in preparing a defence against the complaint by:-

  • reviewing business practices and operating procedures;
  • conducting a market analysis (including analysis of the size, growth, profitability, trends of the market and other key success factors);and
  • preparing a rebuttal expert report.

Contact our Experts

JLA Asia is experienced in similar administration matters. If you have questions, speak with one of our experts.