Paper Tiger

Despite years of discussion and public pressure, the government still has no timetable for a bill on the protection of consumers’ rights and the competition law

Local fuel prices are a recurring complaint of residents: the price going up quickly but coming down slowly. The government once wrote to local fuel companies to solicit information about the fuel price mechanism, but the request was shrugged off – with a legal letter claiming the authorities had no grounds to do so.

It is one of the instances demonstrating the urgency for amendments to the city’s legal regime on consumer protection and market competition. Despite years of discussion and public pressure – plus numerous delays – the Administration still has no timetable for submitting a bill on protecting consumers’ rights and competition law.

Two laws concerning consumer rights are currently in effect in the territory: No. 12/88/M Law on Consumer Protection and No. 4/95/M Law on Restructure of the Consumer Council. But the two regulations have not been subject to major revision for more than two decades, lagging the development of a city that has become one of the fastest growing economies in the world.

The government conducted a public consultation in 2014 on setting up a comprehensive regime concerning consumers’ rights and free market competition; namely, giving more power to the Consumer Council to clamp down on irregular business practices, supervising the market mechanism, and overseeing new types of retail model. For example, the consultation draft mandates that the watchdog can solicit information from retailers and businesses for the pricing mechanism of services and products.

Comparing prices

The proposed draft, however – after four years – has yet to be finalised.

“The Consumer Council is now a toothless tiger,” said legislator Wong Kit Cheng. “Although it has a complaint mechanism for consumers’ disputes, it does not have any power to penalise retailers for malpractices and cannot efficiently help consumers pursue compensation for any loss.”

“It seems now what it can achieve is only comparing prices [of products or services] among different retailers,” the legislator lamented. “As Macau is a tourism city, [revamping the regulations] is not only beneficial to residents but also visitors.”

According to Consumer Council figures, it handled 5,067 cases last year – down 21 per cent from the previous year – comprising 1,647 complaints, 3,397 enquiries, and 23 proposals. Of more than 5,000 cases, about 20 per cent were filed by visitors, including 574 complaints and 421 enquiries.

Lei Leong Wong, head of one of the city’s prominent grassroots groups, also urges the Administration to speed up the updating of rules.

“Although [the Consumer Council] has a complaint mechanism for consumer disputes, it does not currently have any power to penalise retailers for malpractices and cannot efficiently help consumers pursue compensation for any loss,” says legislator Wong Kit Cheng.

“The Consumer Council should have more power to access the information of import, wholesale and retail prices [of different products and services], and establish a mechanism to publicise such information,” he believes.

“Keeping the pricing mechanism [of products and services] transparent plays an important role in safeguarding the rights of consumers and striking a balance of power between merchants and consumers,” said the president of the Macau Institution of the People’s Alliance. While the watchdog has publiscised some pricing information of products on its website, many have not been updated for a while, he added.

Several delays

With all the work concerning the consultation of the relevant regulations concluded in 2015, the government announced that the drafting of the consumers’ rights protection bill would be completed in the following year but later pushed the deadline to 2017. The latest deadline was the first half of this year – pledged by Secretary for Administration and Justice Sonia Chan Hoi Fan earlier this year, who said at the time that the Consumer Council would also be revamped.

In the Policy Address for 2018, the government said it should have started restructuring the Consumer Council last year to complement the consumers’ rights protection bill in order to enhance the Administration’s governance and management in the matter.

Empty words, again.

‘The taskforce led by the Legal Affairs Bureau with the Macau Economic Services and the Consumer Council as members has been actively following up the legislative work of the law on consumers’ rights protection,’ said the Consumer Council in one of its latest statements.

The taskforce has undertaken a comprehensive review of the relevant rules in Macau and the execution of public bodies, as well as looking into the experiences of other jurisdictions, the statement reads. ‘[It] has done a large amount of work in analysis and research for drafting the bill,’ the watchdog added.

‘But a lot of content in the bill concerns more work for the businesses in their operation, while the taskforce has also gathered various opinions from representatives of consumers’ rights and the commercial sector,’ the watchdog said. ‘It is now adjusting the content of the bill, striving to introduce it to the Legislative Assembly as soon as possible.’

It did not reveal the content of the bill or a timeframe for submission.

Separate bill

Although a competition law has been enacted in nearby Hong Kong since 2015 and an anti-monopoly law in Mainland China since 2007 to ensure fair market competition in different sectors of the economy, Macau still lacks a comprehensive legal regime on the matter. During the consultation of the bill on consumers’ rights protection in 2014, the original draft consisted of clauses tackling unfair competition, price fixing, and monopoly and oligopoly – but the government later decided to legislate the topic in a separate bill due to its complexity.

“The Consumer Council should have more power to access the information of imports, wholesale and retail prices [of different products and services] and establish a mechanism to publicise such information,” says Lei Leong Wong, president of the Macau Institution of People’s Alliance.

“The government explained [at the time] that the competition bill would be a separate law because the authority-in-charge was different from the consumer protection law,” said legislator Wong: “While this helps smooth out the governance of the authorities . . . it will leave a gap in the work in safeguarding the rights of consumers as the legislative progress of the two laws will not be the same.”

Concerning the legislative progress of the competition law, the Consumer Council announced that the authorities have commissioned an academic institution to conduct a study on how to create a fairer market environment and mechanism, as well as strengthening supervision of any irregular commercial practices.

“The study will provide a basis for the policy formulation of the government,” it remarked. “It has gradually been carried out and is expected to be completed by year-end.”

But once again the government neglected to say when the final draft of the competition law would be available and introduced to the public and the legislature.

Jewellery tops consumer complaints

Issues regarding jewellery and property are the top two complaints filed by consumers so far this year, according to the latest figures from the consumer watchdog.

In the first half of this year the Consumer Council handled 2,695 cases, up 10 per cent year-on-year, including 958 complaints, 1,733 enquiries, and four proposals. Of the complaints the watchdog has received about 43.4 per cent, or 416, were filed by visitors. Coupled with 368 enquiries and proposals, tourists accounted for about 29 per cent of the total cases the watchdog has handled.


       Number of complaints the Consumer Council handled in 2017

With regard to the nearly 1,000 complaints in the first half of this year, most cases – or about 100 complaints – were about jewellery; and gold jewellery in particular. The number of jewellery complaints represented a hike of 85 per cent from the same period of last year, with 70 per cent of complaints filed by travellers, the watchdog said.

It explained that disputes were primarily about the sales practices of jewellers as well as the quality of jewellery: consumers were refunded in some cases following the intervention of the authorities.

Following jewellery, about 88 complaints in the first six months of this year concerned property purchases in Macau and Mainland China, in which most consumers bemoaned property developers had failed to fulfil some clauses in their contracts. With regard to the complaints about property purchase outside of Macau, the watchdog said: ‘[It] will try to help Macau residents during disputes about overseas property purchase through a regional co-operation mechanism, but consumers could only pursue [these] in court if negotiations fail.’

Public transportation is another leading complaint filed by residents and tourists in the January-June period, accounting for 85 cases, of which 72 concerned the malpractices of rogue taxi drivers. The watchdog emphasised it would further co-operate with other government departments to handle this type of complaint to better safeguard the rights of consumers.

Disputes also often occurred in the entertainment industry and food and beverage sector in the first six months, garnering 67 and 63 complaints, respectively.