COVID-19 and the Competition Ordinance


In light of the recent COVID-19 outbreak, the Competition Commission (“Commission”) issued a press release on 27 March 2020 on the application of the Competition Ordinance (Cap 619) (“Ordinance”) in terms of the supply of critical goods and services in Hong Kong. The Commission recognises that businesses in specific industries need additional cooperation on a temporary basis (e.g. to maintain the supply of essential goods and services to consumers). As a result, the Commission has stated that it intends to take a pragmatic approach in its enforcement and advisory functions.

Noting that the Ordinance (including the First Conduct Rule) continues to apply in full, businesses should keep in mind the following when contemplating certain cooperation arrangements in response to the COVID-19 outbreak:

  • Joint buying – The parties should check that they do not have market power in the relevant downstream market; 
  • Joint production – The parties should check that they would not objectively be able to produce a product alone; 
  • Sales-related joint ventures – The parties should check that each party could not objectively have entered a market on its own or with a smaller number of parties than actually involved in the collaboration; and 
  • Exchange of information – The parties should check that the information being exchanged is on matters such as best practices or publicly available information (rather than “competitively sensitive information”).

If your business is contemplating or engaging in the above cooperation arrangement in response to the COVID-19 outbreak, we suggest to contact us to further consider compliance with the First Conduct Rule and where necessary discuss the cooperation arrangement with the Commission.

Herman Pang

Eddie Look
Partner | E-mail
Tim Drew
Partner | E-mail
Edmond Leung
Partner | E-mail
River Stone
Partner | E-mail
Pádraig Walsh
Partner | E-mail

Disclaimer: This publication is general in nature and is not intended to constitute legal advice. You should seek professional advice before taking any action in relation to the matters dealt with in this publication.