Hong Kong consumer watchdog slams 4 pharmacies over poor sales practices amid surge in complaints after border reopening

Hong Kong’s consumer rights watchdog has named and shamed four pharmacies over their sales practices amid a surge in complaints following the reopening of the border with mainland China.

The Consumer Council on Thursday said all four were located in popular tourist area Causeway Bay and mainly sold Chinese herbal medicine and dried seafood. The pharmacies are City Medicine, Medicine Palace Living Plaza, Global Medicine Company and On Hong Medicine Company.

“The four traders are located in a prime shopping area frequented by tourists and the number of complaint cases involved has surged evidently since the borders reopened, not only greatly impacting the retail and tourism industries and affecting tourists’ experience, but also severely jeopardising the reputation of Hong Kong,” said Tony Pang Chor-fu, vice-chairman of the trade practices and consumer complaints review committee of the council.

The council received a total of 96 complaints related to the four pharmacies within the 32 months from 2021 to August this year. Among them, 80 cases involved poor sales practices, accounting for 31 per cent of the total 262 complaints of the same nature during the period.

The number of complaint cases against the four businesses surged after the border between the city and the mainland fully reopened earlier in 2023, following years of strict controls during the pandemic. A total of 49 cases were recorded for the four businesses between January and August, involving HK$586,001 (US$74,718) overall.

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Only 26 such cases were recorded for the whole of last year, according to the council.

Among the 49 cases this year, 10 involved locals, and the rest were reported by tourists. One of the visitors came from Macau, another from Singapore and 37 from the mainland.

Pang said most of the complaints involved trade malpractice. Examples included using misleading units for pricing, such as from catty to tael and from tael to mace, with signage displayed prominently but weights listed in tiny fonts or muted colours below the cost.

He noted that when asked, shop assistants would only tell consumers the price displayed but omitted or avoided saying the unit of measurement. They would also quickly grind or slice the products before consumers realised the actual price, and force consumers to complete the transaction on the pretext that the goods had already been processed.

“The fact that catty is a commonly used unit of measurement in the mainland makes it easier for mainland tourists to fall into these sales traps,” Pang said.

“Such sales malpractices might constitute the offence of misleading omissions and possibly be in violation of the Trade Descriptions Ordinance,” he said, adding the maximum penalty upon conviction was a fine of HK$500,000 and five years’ imprisonment.

The council found the site of the City Medicine shop was formerly occupied by a pharmacy named Chung Wang Tong Medicine Co, which was publicly named and reprimanded in 2015 for its sales practices. Records from the Companies Registry showed that one of the shareholders of City Medicine was Chung Wang Tong Medicine Co.

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The watchdog publicly named and condemned seven pharmacies in 2015.

Global Medicine Company, a firm shamed by the council on Thursday, had closed down and its premises had been taken over by On Hong Medicine Company, which was also named by the watchdog. Both businesses were operated by the same owner, Zenith Capital Corporation, the council said.

“It is a common industry tactic to run the business under a new company name, so as to blindside consumers,” Pang said.

The council had already approached the four businesses involved. A representative who said they managed accounting for City Medicine and Medicine Palace Living Plaza denied the accusations, but agreed to relay the council’s message to management. The person in charge of Global Medicine Company refused to meet staff from the council but promised to improve sales practices and properly handle the complaints.

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The businesses had agreed to give partial or full refunds to all customers involved in the cases recorded between January and August, according to the council.

“The council anticipates that this naming sanction will serve as a firm warning to the bad apples in the industry that such sales malpractices will not be tolerated,” Pang said.

He urged the industry to take action to curb poor sales practices, and regulatory and enforcement authorities to step up their work.

The council had signed memorandums of understanding for collaboration with the consumer bodies of several mainland provinces and cities, including a cross-border disputes referral mechanism, Pang said. Such moves allow mainland tourists to file complaints against Hong Kong traders with their local consumer body.