The Hong Kong Competition Ordinance (the “Ordinance”) came into full effect in Hong Kong on 14 December 2015.  The Ordinance which covers the whole economy of Hong Kong was first introduced into the Legislative Council in 2010 and was subsequently passed on 14 June 2012.  The full force of the Ordinance was not brought into effect immediately (for three and a half years) but its full implementation was delayed to allow businesses and industries in Hong Kong to understand the new law and take necessary time and steps to comply with its requirements.  The objective of the Ordinance is to restrain anti-competitive conduct and any abuse of market power.  The Ordinance also covers merger activities but for now, the rules on merger shall only apply to participants in the telecommunications industry.

In recent years, there has been increasing scrutiny of the financial sector by competition regulators in overseas jurisdictions, and this trend is expected to continue here in Hong Kong under the new regulatory regime.  For example, the high profile investigations by anti-competition authorities in 2011 on whether some of the largest banks in the world had reached agreements to fix the London interbank offered rate (Libor) comes to mind.  This article aims to provide an overview on the key provisions of the Ordinance and consider the implications for the financial services industry: