Impact of the judgment on the implementation of the New Competition Ordinance.
On January 29, 2016, the Hong Kong Court of First Instance handed down a judgment in favour of Television Broadcasts Limited (TVB), a free-to-air broadcaster in Hong Kong, in its judicial review application against the Communications Authority (CA) and the Chief Executive in Council (CEIC) in HCAL 176 of 2013.
The judicial review concerned the CA’s censure of TVB for certain contractual practices and clauses employed by TVB with respect to its employment of artistes and TV performers. In September 2013, the CA found that TVB was engaged in anti-competitive conduct in contravention of sections 13 and 14 of the Broadcasting Ordinance (Cap. 562, the BO). By its decision, the CA had imposed a financial penalty as well as a number of ‘cease and desist’ directions upon TVB with respect to contractual practices.
In December 2013, TVB issued judicial review proceedings against the CA and the CEIC, challenging the constitutionality of the overall statutory scheme (including the adjudication by the CA and potential review of the CA’s decision by the CEIC) as well as raising other competition law issues in challenging the assessment under the CA’s decision of its dominant market position. Under the judgment it was held that the CA and the CEIC are not ‘independent and impartial tribunals’ for the purposes of compliance with the Hong Kong Bill of Rights and that the remedies imposed by the CA (the ‘cease and desist’ directions imposed on TVB) were disproportionate.
The case raised new and untested questions concerning historic competition provisions1 in the BO and related legislation in Hong Kong (which mirror the provisions recently introduced to the broader economy in Hong Kong under the new crosssectoral Competition Ordinance (Cap. 619) which came into full effect on December 14, 2015).
London Queen’s Counsel specialising in competition and administrative law appeared respectively for TVB and the CA in a four day hearing in October 2015 before the Honourable Mr Justice Godfrey Lam. His Lordship’s 150- page long judgment, which contains a detailed analysis of European jurisprudence on human rights and competition law, will serve as useful guidance in the future with respect to the implementation and enforcement of the new Competition Ordinance.
The fact that the judgment was delivered by Godfrey Lam J is significant as he has recently been appointed President of the newly formed Competition Tribunal which will be the judicial body responsible for dealing with legal proceedings concerning competition matters, including those involving contravention of conduct rules under the ordinance.
Two key areas of the judgment are explored below.