Over 80% support legal cooling-off period for prepaid services

Following the sudden temporary closure of all locations of the PHYSICAL Fitness & Beauty in Hong Kong, individuals who had prepaid for memberships and packages suffered significant losses. This incident has sparked widespread discussion among the public and various sectors about the need for a legally mandated cooling-off period for prepaid consumer services.

In response, the New Youth Forum and Legislative Council member, Tang Ka-piu, surveyed in Sept. to explore public opinion on this issue.

The survey, which successfully interviewed approximately 700 residents by phone, revealed that half of the respondents expressed concern over the temporary shutdown of major chain fitness and beauty centers. Nearly 80% believed that current laws do not sufficiently protect consumer rights; over 80% supported establishing a statutory cooling-off period for prepaid purchases. Among these supporters, more than 60% suggested that the cooling-off period should range from 14 or 21 working days to one month.

More than half of the respondents opposed the industry's offer of a voluntary cooling-off period, preferring legislation instead. Three-quarters supported setting a maximum contract duration for prepaid services, with many favoring a limit of one year.

Tang noted that existing laws are inadequate for protecting consumer rights and advocated for the swift establishment of a statutory cooling-off period to protect consumers and sales agents.

Tang also commented on the industry's proposed voluntary cooling-off period, pointing out that due to the lack of industry standards, some businesses offer too short a period, and others impose unjustified restrictions that undermine consumers' rights to cancel contracts, rendering the practice less feasible.

Despite the majority of survey respondents supporting a maximum contract duration for prepaid agreements, the support level was lower than that for the statutory cooling-off period. Tang highlighted that such measures could impact business investment decisions, requiring a balance of interests within the industry.

Tang stated that since there has been no consultation on maximum contract durations, priority should be given to establishing a statutory cooling-off period while considering feedback from various community sectors.

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