21 February, 2016
In Hong Kong, only the Competition Commission (Commission) can commence proceedings in the Competition Tribunal (Tribunal) alleging a person or company has breached one of the conduct rules under the Competition Ordinance (Ordinance). A third party can only bring a follow-on action once there has been a determination or admission that a contravention of a conduct rule has occurred.
When you may bring or be exposed to a follow-on action
A private claim for damages and redress can only be brought against a company in the Tribunal once a company or person has contravened the first conduct rule (FCR) or second conduct rule (SCR). The Ordinance will treat an act as a contravention of a conduct rule only if:
- The Commission has brought proceedings before the Competition Tribunal and the Tribunal (or a Court of Appeal) has determined the act contravened a conduct rule; or
- A company or person has admitted to contravening a conduct rule in a commitment that has been accepted by the Commission.
- A follow-on action can only be brought after the appeal period, or an appeal has been determined, and must be brought within 3 years of the contravention being determined.
Please click on the hyperlinks should you wish to read our previous alerts on the FCR, SCR or Commitments.
Who can bring follow-on actions?
Only those that have suffered loss or damage as a result of the contravening act have a right of action. The private action may be brought against any person, company, or combination of parties, who has contravened a conduct rule or who was otherwise involved in the contravention.
What orders can the Tribunal make in follow-on actions?
A Tribunal has the power to make a wide range of orders in follow-on actions in addition to an order for damages. If bringing a private action for damages, you can also seek orders from the Tribunal requiring the company or person who has breached the Ordinance that:
- require the company or person do an act or thing, including restoring parties to the position they were in prior to the contravention;
- renders agreements void or voidable or otherwise terminates, modifies or prevents that person or company from making or giving effect to an agreement; and
- require the company or person to supply (or be prevent them from withholding) goods or services, or requiring the person or company give certain persons or classes of persons access to goods, facilities or services.
