Briefing
Overview of marketing laws
and regulations in Hong Kong
Summary
Various pieces of legislation regulate
advertising in Hong Kong; they aim to protect
consumers’ rights. In this briefing we examine
those related to marketing and advertising
non‑alcoholic drinks. And we highlight
some of the main points of each – from bait
advertising to data privacy to passing off.
For further information please contact
Connie Carnabuci
Partner, Hong Kong
T +852 2846 3300
E connie.carnabuci@freshfields.com
Freshfields Bruckhaus Deringer llp
Overview of marketing laws and regulations in Hong Kong
March 2012
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Introduction
In Hong Kong, no single generic legislation
regulates advertising. Instead, there are
relevant pieces of legislation related to
advertising. This legislation prohibits false
trade descriptions of goods and prohibits
advertisements that falsely describe any
food or drug or that are likely to mislead.
It also empowers the courts to give relief
in relation to certain contracts found to
be unconscionable. The local broadcasting
authority issues codes of conduct that
provide guidelines for advertising on
television and radio.
Other areas of law that may be relevant to
advertising in Hong Kong include passing
off and malicious falsehood as well as
possible actions arising from trade mark and
copyright infringements. There are also data
privacy issues if a marketing programme
entails collecting, processing and using
personal data.
Marketing and advertising laws aim to
protect consumers’ rights. Here we focus
on consumer protection in marketing and
advertising non-alcoholic drinks. We do not
cover laws and regulations for marketing and
advertising other goods and services, and we
do not cover all marketing and advertising
laws and regulations in Hong Kong.
Trade Descriptions Ordinance (Cap 362)
The Trade Descriptions Ordinance (Cap 362)
(TDO) prohibits false trade descriptions;
false, misleading or incomplete information;
false trade marks; and misstatements of
goods provided in the course of trade or
suppliers of such goods in Hong Kong. It
covers goods, not services or real property.
In 2008, the TDO was expanded to provide
more effective consumer protection and
to deal with malpractices relating to new
products and innovative advertisements by
retailers.
‘Trade description’ is defined to include
matters relating to quantity, method of
manufacture, composition, fitness for
purpose, warranty, after-sales service
and maintenance services. Giving false,
misleading or incomplete information may
constitute an offence under the TDO.
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It is a criminal offence if one makes ‘false’
or ‘misleading’ representations to another
that he is connected with, or endorsed by,
any individual or body. The person making
the representation has a valid defence if it is
proved that he or she did not know and had
no reason to believe that the representation
was false.
Unlike the common law action of passing
off, there is no requirement to establish
goodwill or that a consumer has relied
on the reputation or has been confused
by the representation. The offence is,
however, limited to intentionally false
representations. On the other hand, the
tort of passing off can apply to innocent
misrepresentations as well.
The criminal liabilities include a fine and
imprisonment under the TDO. A director
or an officer of a company convicted shall
also be guilty of that offence. It is, therefore,
prudent when marketing or advertising
to ensure there are no false or misleading
descriptions in advertisements. The TDO
does not allow a private right of action. But
aggrieved consumers may complain to the
Hong Kong Customs and Excise Department,
which enforces the TDO.
Unconscionable Contracts Ordinance
(Cap 485)
Under the Unconscionable Contracts
Ordinance (Cap 485) (UCO), the court is
empowered to give relief in contracts found
to be unconscionable. The court may refuse
to enforce a contract, enforce the remainder
of a contract without the unconscionable
part or limit the application of, revise or
alter, any unconscionable part to avoid any
unconscionable result. At least one of the
parties to the contract must be a consumer.
The UCO lists matters the court may take
into account to determine if a contract is
unconscionable. ‘Unfair tactics’ may include
bait advertising, harassment and coercion.
Bait advertising is where a trader advertises
goods or services as a bargain – but does
not intend to supply them – to attract
consumers, then persuades them to buy
other goods or services at a higher price.
Overview of marketing laws and regulations in Hong Kong
March 2012
Public Health and Municipal Services
Ordinance (Cap 132)
There are food laws in Hong Kong requiring
general protection for food buyers. The
sale of unfit food and adulterated food will
constitute an offence. Composition and
labelling of food, food hygiene, seizure and
destruction of unfit food are examples of
such food laws. Under the Public Health
and Municipal Services Ordinance (Cap 132)
(PHMS), it is an offence to publish an
advertisement that falsely describes food
or is likely to mislead as to the nature,
substance or quality of food.
One defence is if the defendant can prove
he did not know, and could not have
ascertained, the advertisement contained
false or misleading information. Another
is if the person who publishes or arranges
publication of advertisements received the
advertisement in the ordinary course of
business.
The PHMS also provides for rules relating
to the form of advertisements, decorations
and signs that can be displayed in Hong
Kong. For example, no bill or poster can be
displayed on any private land or government
land, without the written permission of the
owner or occupier or relevant authority.
Passing off
Passing off is a tort. It does not arise under a
statutory provision.
Under the law of passing off, a defendant is
prevented from representing his goods or
services as those of a competitor. As in other
common law jurisdictions, the Hong Kong
law of passing off requires the plaintiff to
prove that:
• the plaintiff’s goods or services have
acquired goodwill/reputation in the
marketplace that distinguishes them
from those of competitors;
• the defendant misrepresents his goods
or services, whether intentionally or
unintentionally, so that consumers of the
plaintiff’s goods and services (or other
persons in the trade) believe either that
the defendant’s goods or services are
those of the plaintiff or that the plaintiff
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has a trading connection with the
defendant; and
• the plaintiff has or is likely to
suffer damage as a result of the
misrepresentation.
Malicious falsehood
Malicious falsehood is another tort
concerned with false statements published
maliciously that result in damage to the
plaintiff. In marketing and advertising,
this may arise if an advertisement makes a
malicious statement about a competitor or
its goods or services.
An action for malicious falsehood includes
false statements; statements that refer to
the plaintiff or its property or business;
statements published with malicious intent,
which can either mean the defendant knew
of their falsity, acted with disregard for the
veracity of the statements when they should
have known they were false, or failed to
take reasonable precautions to ascertain the
statements’ veracity; the plaintiff suffered
special damages, unless the plaintiff
can establish that the uttered words are
calculated to cause pecuniary damage.
In comparative advertising, there is a
distinction between ‘puffing’ one’s own good,
which is legal and will not give rise to liability
for malicious falsehood, and denigrating a
competitor’s goods. The latter may give rise
to liability for malicious falsehood. The test
is whether a reasonable man would take
the disputed statement seriously. The more
precise the claim, the more likely it would
be taken seriously; conversely, ‘the more
general or fuzzy [the claim] the less so.’ If the
facts being compared could never be justified
and are ‘obviously untruthful and libellous’,
then the advertisement may give rise to
liability for malicious falsehood.
Advertising standards
The Generic Code of Practice on Television
Advertising Standards (the TV Advertising
Code) relates to television advertising
in Hong Kong. The radio advertising
equivalent in Hong Kong is the Radio Code
of Practice on Advertising Standards (the Radio
Overview of marketing laws and regulations in Hong Kong
March 2012
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Advertising Code, together with the TV
Advertising Code, the Codes). The Hong
Kong Broadcasting Authority (BA) issues the
Codes, and the licensed broadcasters ensure
the Codes are observed.
Under the Codes, advertisements should
be presented with courtesy and good taste.
Advertisements must be ‘legal, clean, honest
and truthful’. They are prohibited from
containing disparagement of competitors
or competing products and unreasonable
imitation or approximation of the name of
competitors or their slogans.
Depending on the severity and nature of the
conduct, the BA may advise the broadcasters
that broadcast the advertisement to observe
the provisions of the Codes; warn them
against further contraventions; require
them to include a correction or apology, or
both, in their service; impose a financial
penalty on broadcasters; or in serious cases,
suspend or revoke the broadcasters’ licences.
Factual and best-selling claims must be
capable of substantiation. Claims about the
nutritional and dietary effects of products
and services should also be handled with
care. Some rules in the Codes are on
advertisements for products and services
with such claims. For example, claims
for the nutritional value of food must be
supported by sound scientific evidence
and must not mislead on the nutritional or
health benefits of the food as a whole.
Intellectual property infringement
Trade mark infringement
When marketing and advertising in Hong
Kong, it is prudent to ensure that no
registered trade mark belonging to another
is infringed. Under the Hong Kong Trade
Marks Ordinance (Cap 559) (TMO), a person
infringes a registered trade mark if he uses
it in a sign that is:
• identical to the trade mark in relation to
goods or services, which are identical to
those for which it is registered;
• identical to the trade mark in relation
to goods or services which are similar to
those for which it is registered, and this
has confused the public;
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• similar to the trade mark in relation to
goods or services, which are identical or
similar to those for which it is registered,
and this has confused the public; and
• similar or identical to a well-known trade
mark in relation to goods or services
which are not identical or similar to those
for which it is registered, and the use of
the sign takes unfair advantage of or is
detrimental to the distinctive character or
repute of the trade mark.
To determine whether a trade mark is well
known in Hong Kong, the registrar or the
court will take into account any factors
including:
• the degree of knowledge or recognition of
the trade mark in the relevant sectors of
the public;
• the duration, extent and geographical
area of any use, promotion or registration
of the trade mark, to the extent that they
reflect use or recognition of the trade
mark;
• the record of successful enforcement of
rights in the trade mark, the extent to
which the trade mark has been recognised
as ‘well known’ by competent authorities
in foreign jurisdictions; and
• the value associated with the trade mark.
Comparative advertising
Under the TMO, using a third party’s mark
to identify goods or services as those of the
third party is allowed, unless the use is not
in line with honest practices in industrial
or commercial matters, in which case it
is considered an infringement. This is a
key provision in assessing the legality of
comparative advertising. If the comparative
advertising takes unfair advantage of the
third-party mark, or is detrimental to
its distinctive character or reputation, or
deceives the public, then a claim may arise.
Copyright infringement
Similarly, care should be taken not to
infringe the copyright of another when
marketing and advertising in Hong Kong.
While a competitor’s name may not meet
the creative threshold required to qualify
as a copyright work, its logo is likely to be
Overview of marketing laws and regulations in Hong Kong
March 2012
both a trade mark and a copyright work.
It is, therefore, advisable to exclude all
branding, insignia or other materials of the
competitor that could be copyright works
from advertising.
Data privacy issues
The Hong Kong Personal Data Privacy
Ordinance (Cap 486) (the Privacy Ordinance)
governs the collecting, processing and
using personal data in Hong Kong. If the
marketing exercise entails collecting,
processing and using ‘personal data’; that is,
information relating to and identifiable with
a living individual, the use of that data is
required to comply with the data protection
principles of the Privacy Ordinance to the
extent that the marketing exercise involves
the use of personal data.
Among other obligations, when collecting
such data, one must tell the individual of
the reason for the data collection, processing
and use, to whom their data may be
transferred, their right to access and request
data correction and the contact details of the
representative to whom their requests may
be made. Once collected, the personal data
may only be used for the original purpose,
or a related purpose, and must not be used
for any other purpose without the express
consent of the individual.
There is no statutory restriction in force
on the transfer of personal data from
Hong Kong overseas. The data protection
principles of the Privacy Ordinance will
continue to apply to exported personal data.
The Personal Data (Privacy) (Amendment) Bill
2011, published in July 2011 and likely to be
implemented in due course, requires that
individuals are informed of their right to
opt-out from use of their personal data for
marketing purposes, both on first use and at
any subsequent time.
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Overview of marketing laws and regulations in Hong Kong
March 2012
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