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HK Legco to reform outdated laws for innovation and tech

Charles Mok's motion to reform outdated HK laws was passed at LegcoThe Hong Kong Legislative Council (Legco) last Thursday (6 July) passed a motion to reform outdated legislation and to promote the development of innovation and technology.

The motion, moved by Legislative Councilor (IT functional constituency) Charles Mok, followed the new Chief Executive Carrie Lam's remarks at Legco on 5 July that outdated laws should be reviewed and updated.

At Legco, Mok said that supporting innovation and upholding the rule of law are not contradictory. He urged the government to review outdated laws with an open mind, while making the promotion of innovation and technology a policy objective.

Mok added that Hong Kong's competitiveness in innovation has declined in recent years, while Singapore, China and Taiwan have all adopted progressive approaches in regulating new technology. He urged the government to be more proactive in addressing challenges from new economy and emerging technologies through broad consultation and reviewing outdated laws to send a positive message to the industries, in order to attract investment and talents from abroad.

Without suggesting a time as to when the amended laws would take effect, Mok said, "Chief Executive Carrie Lam was positive in her reply to my question during the CE Q&A session prior to the motion debate that she acknowledged the need to update laws and also pledged to bring initiatives within her tenure. So I hope she can deliver her promise as soon as possible."

Uber clashes with HK laws

To illustrate, Mok highlighted a number of cases such as online hailing service, ride-sharing, short-term home rental and fintech. He said many countries have consulted stakeholders and put forward new legislation to regulate innovative business models. Japan, for instance, has recently issued regulations on residential flats for lease on a short-term basis and Singapore is now issuing licenses for online hailing services and ride-sharing.

For instance, taxi booking service provider Uber saw five of its taxi drivers arrested by the Hong Kong Police on August 11 2015. They were later found guilty on 10 March 2017 for driving vehicles for hire without permits and third-party insurance.

"The transport law is from over 40 years ago", said Uber Hong Kong General Manager Kenneth She to reporters after the verdict. "We hope that the government does not only look at outdated laws but truly takes a step forward", he said.

More recently, on 23 May 2017, the Hong Kong Police arrested 21 Uber taxi drivers in Hong Kong under the same charges.

Policy recommendations

To properly resolve the challenges between the current regulatory framework and the development of innovation and technology, Mok recommended the Government to:

  • establish a cross-departmental working group on reviewing outdated laws;
  • extend the use of 'regulatory sandbox' to other policy areas;
  • create better communication channels with businesses; and
  • adopt Singapore's approach of conducting pilot schemes to improve regulatory regimes and foster competition to make lives better for the community.

Following the passing of the motion, Mok will facilitate the liaison between the administration and the innovation and technology community to map out necessary changes in the regulatory framework.

Extensive scope of law amendment

In an exclusive interview with Computerworld Hong Kong, Mok said the scope of law amendment to be extensive, affecting all entrenched industries.

CWHK: To effect or facilitate the development of innovation and technology, what will be likely scope of "outdated laws" to be changed or updated?

Mok: From transport, environment, finance to privacy protection, the scope is certainly extensive for laws that have to be put under review in order to cater for the development of innovation and technology. What the government has to do is to consult the public thoroughly and map out the priorities in areas that have to be tackled first.

CWHK: What changes to the "outdated laws" should we expect? Can you give one or two examples?

Mok: Online hailing services, ride-sharing and short-term home rental are only a few examples of innovations that are prevailing around the world but are forbidden in Hong Kong. The government can consider the Singapore model in issuing licenses for online hailing services and ride-sharing, and also refer to Japan which set out regulations on residential flats for lease on a short-term basis upon some conditions.

CWHK: Which industries do you think the updated laws will impact the most? E.g., car sharing, taxi-booking service provider?

Mok: I believe all entrenched industries that have failed to change will be disrupted by innovations and technology eventually. Policies should not favor protecting the status quo which often benefits the vested interests.

I urge the government to be more proactive in addressing challenges from new economy and emerging technologies through broad consultation and reviewing outdated laws to send a positive message to all industries, and to attract investment and talents from abroad.