The litmus test for government's sincerity in promoting competition is whether it wants to include an anti-trust law governing mergers and acquisitions under the umbrella of a comprehensive competition law. Without such an anti-trust law, there's no effective prevention of existing cartels growing even bigger and more powerful. Also, if there is no corresponding change to existing company law, anything that the government does on the competition issue would just be perfunctory.

but with an anti-trust law, will we see that there really is no reason for businesses to be here in Hong Kong other than because they can be involved in cartels?

The ultimate objective of antitrust laws is to make illegal certain practices that are deemed to hurt businesses or consumers or both, or to generally violate ethical standards. It is the small businesses in Hong Kong that need survival space and hence protection under such laws. One such practice that immediately springs to mind is the resale price maintenance practice in the supermarket industry. Another one is the monopoly of retail shop spaces by the property cartel driving rentals skyhigh and stifling small businesses.

Interesting discussion. You might like to look at www.hkcomplaw.wordpress.com where we're trying to keep up to date on the latest developments in competition law here in Hong Kong.

Interestingly, the Government's position on M&A seems a little ambiguous at present and some people suggest it will be in the new law, but won't be activated until a while later. Don't know the truth of that yet.

Resale price maintenance seems unlikely to be covered because it was not mentioned in the 7 forms of proscribed conduct recommended by the Competition Policy Review Committee last year.

As for monopoly prices, if the Government continues to focus on conduct rather than structural issues, it's unlikely that high rents alone could trigger a competition law investigation.

Interesting times - and great to see the discussion of competition law spreading to other sites.

Keep up the good work!

Peter

I wasn't previously aware of your posting policy. Please delete my previous post as I have not intention to pay to place my comments here.

Peter

Actually Legolas, you've touched on the key point: does the government want legislation that works in the interests of consumers, in the interests of businesses, or both? It's hard to see the government willingly introducing anti-trust legislation given this city is largely run by cartels in key industries. That was my point: this legislation might look OK on paper, but it is likely not going to be backed with firm implementation or resources. I'd be happy if I was to be proved wrong.

Simon, I totally agree with you. The devil is in the details! I'll bet that it will just be another piece of toothless legislation!

Peter, thanks for pointing to your informative website.

Peter, your comment is absolutely fine. That comment is to prevent spammers, not that it does too much in that regard!

Thanks Simon.

Peter