Wait a minute – introducing mandatory cooling-off period

On 15 January 2019 the Hong Kong government issued a consultation paper to seek views on the introduction of a statutory cooling-off period for beauty and fitness services consumer contracts. The consultation period ends on 16 April 2019. We have summarized the key features of the proposal below.

While the scope of the proposal is confined to specific contracts in the beauty and fitness service industries, what are the potential wider complications?

  • The government's initiative is yet another signal that consumer rights are on the rise. In recent years, the government has introduced legislative reforms (e.g., Competition Ordinance, unfair trading practices under the Trade Descriptions Ordinance) that, to various extents, enhance consumer rights.
  • This also means businesses and trades must pay more attention to compliance with the increasingly complex consumer regulatory regime.
  • The government has left open the possibility of expanding the mandatory cooling-off period to other industries, to cater for changing market practice. Indeed, some businesses are already thinking ahead and voluntarily offer customers cooling-off periods in their contracts.
  • When introducing a cooling-off period, apart from reviewing and revising the relevant contract terms, businesses should also consider payment/refund/chargeback issues with banks and credit card companies.

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