LCQ13: HKIA's "Guaranteed Downtown Prices" scheme


Hong Kong (HKSAR) -      Following is a question by the Hon Luk Chung-hung and a written reply by the Secretary for Transport and Housing, Mr Frank Chan Fan, in the Legislative Council today (February 7):

Question:

     It has been reported thatsince 2004, the Airport Authority Hong Kong (AA) has invariably included a provision on guaranteed downtown prices in the tenancy agreements for the shops in the airport. Under such provision, the retailers pledge to AA that the prices of the items sold at the shops in the airport will not be higher than those of identical items sold at the same retailers' comparable outlets in Hong Kong operating under the same trade name. In this connection, will the Government inform this Council:

(1) whether it knows if AA regularly took random samples in the past three years for comparison of the prices of the items sold by the retailers at the shops in the airport and those of identical items sold at their other outlets; if AA did, of the number of such operations and the details; if not, the reasons for that;

(2) whether it knows the number of cases uncovered by AA in the past three years in which airport retailers had breached the aforesaid provision, and the follow-up actions taken by AA; and

(3) as AA has indicated that in the event that a consumer discovers that the price of an item bought in the airport is higher than that of an identical item sold at the same retailer's other outlets on the same day, he may send to AA information such as the original sales receipt and the item purchased within 30 days of the date of purchase and, upon validation, a refund by the retailer will be arranged, whether it knows if AA publicised such arrangement in the past three years; if AA did, of the details; if not, the reasons for that?

Reply:

President,

     To enhance travellers' shopping and dining experience at the Hong Kong International Airport (HKIA) so that they would not worry about the shopping and dining at HKIA would be overpriced, the Airport Authority Hong Kong (AA) launched the "Guaranteed Downtown Prices" scheme in 2004, which stipulates that the prices set by the retailers and catering outlets at the HKIA cannot be higher than other downtown outlets operating under the same trade name and similar nature for the same products or food and beverage items. The relevant requirements are set out in the licence agreements with the retailers and catering outlets at the HKIA. Our reply to the various parts of the question raised by the Hon Luk Chung-hung is as follows:

(1) In the past three years, an independent survey consultancy commissioned by the AA has been conducting regular surveys on the prices of retailers and catering outlets at the HKIA.  The surveys were conducted by "mysterious shoppers" covering all tenants (except for those only selling products at fixed prices or not having other outlets in Hong Kong). There are about 140 outlets in total.  As the timing for conducting relevant survey is key to its effectiveness, disclosure of such details as timing and frequency of the surveys are not appropriate. 

(2) From 2015 to 2017, the surveys covered all retailers and catering outlets at the HKIA (except for those only selling products at fixed prices or not having other outlets in Hong Kong). A total of 7 000 items were surveyed to compare the prices of these retailers and catering outlets at the HKIA with their outlets in the main downtown commercial areas.  According to the survey conducted, from 2015 to 2017, the prices of around 80 per cent of the surveyed items were the same or lower than that in the outlets in the main commercial areas. The AA followed up on each and every case of non-compliance and requested for rectification. If any concerned retailers and catering outlets do not make immediate rectification, the AA will continue to follow up until the rectification is carried out. 

     Apart from regular surveys, the AA received complaints against individual retailers and catering outlets regarding non-compliance with the requirements. During the three years from 2015 to 2017, the AA received seven, four and eight complaints respectively. Should non-compliance be found, the AA will request the retailers and catering outlets for rectification.

     To strengthen the effectiveness of "Guaranteed Downtown Prices" scheme, the AA has tightened the terms and conditions of new licence agreements. Under the new licence agreements, the AA reserves its rights to impose penalties on retailers and catering outlets which fail to comply with the requirements. The AA may terminate the licence agreement in case of serious violation.

     In accordance with the AA's current tendering procedures, the past performance of retailers and catering outlets will be taken into consideration during the tender evaluation. The AA will consider specifying in the conditions of future tenders that relevant performance and records under the "Guaranteed Downtown Prices" scheme would also be taken into consideration during tender evaluation.

(3) According to the "Guaranteed Downtown Prices" scheme, if a consumer has bought any item at the HKIA and found that the price is higher than that of an identical item at the retailers' comparable outlets in Hong Kong operating under the same trade name on the same day, one may contact the AA within 30 days from the date of purchase for follow up or refund. At present, information and details on the scheme (including the refund arrangement) can be found on the HKIA website.

The AA will publicise the scheme proactively at the shops at the HKIA and through various channels.



Published on: 2018-02-07

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