XN000022-1994-10-19 — Page 4

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WEDNESDAY, OCTOBER 19, 1994

PRICES OF GOODS AT AIRPORT SHOPS

*

A

IS FOLLOWING

A QUESTION BY THE HON ERIC LI KA-CHEUNG AND REPLY BY WRITTEN

THE ACTING SECRETARY FOR ECONOMIC SERVICES, MRS ELIZABETH BOSHER, IN THE LEGISLATIVE COUNCIL TODAY (WEDNESDAY):

ΚΑΙ QUESTION IS THE GOVERNMENT AWARE THAT THE RENTS OF THE SHOPS AT

TAK AIRPORT AND THE PRICES OF THE GOODS SOLD THERE ARE FAR HIGHER THAN THOSE IN OTHER DISTRICTS IN THE TERRITORY. WILL THE GOVERNMENT INFORM THIS COUNCIL :

(A)

(B)

(C)

WHETHER IT HAS CARRIED OUT ANY IN-DEPTH STUDY TO FIND OUT IF THE SALE OF SUCH HIGH-PRICED GOODS AT THE AIRPORT WILL TARNISH HONG KONG S REPUTATION AS A SHOPPING PARADISE;

WHETHER IT HAS ANY PLANS TO PREVENT SIMILAR SITUATIONS OCCURRING AT THE NEW AIRPORT; AND

WHETHER IT WILL CONSIDER SETTING RULES TO REGULATE THE GROSS PROFITS OF GOODS SOLD IN THE SHOPS AT THE AIRPORT?

ANSWER

IT IS THE AIM OF THE CIVIL AVIATION DEPARTMENT (CAD) TO PROVIDE AIRPORT SERVICES AND FACILITIES AT KAI TAK OF THE HIGHEST POSSIBLE STANDARD. THIS INCLUDES ENSURING THAT

PROVIDING CONCESSIONAIRES RETAIL SERVICES IN THE TERMINAL BUILDING OFFER MEMBERS OF THE PUBLIC QUALITY OF SERVICE AT A FAIR PRICE.

RETAIL CONCESSIONAIRES OPERATING AT THE AIRPORT ARE NOT

CONCESSIONS ARE REQUIRED TO PAY RENT TO THE GOVERNMENT.

AWARDED BY OPEN TENDER AND EVALUATED ON THE BASIS OF THE PROSPECTIVE TENDERER'S SUBMISSION, INCLUDING THE PROPOSED LICENCE FEE TO BE PAYABLE TO THE GOVERNMENT.

CAD ALSO REQUIRES ALL PROSPECTIVE TENDERERS INTERESTED IN BIDDING FOR A RETAIL CONCESSION TO SUBMIT A BUSINESS PLAN, INCLUDING DETAILS OF OPERATING COSTS AND PROPOSED PROFIT MARGINS, WHICH IS TAKEN INTO CONSIDERATION IN ASSESSING THE TENDER. UNDER THE TERMS OF THEIR CONCESSION AGREEMENTS WITH CAD, CONCESSIONAIRES ARE REQUIRED TO ENSURE THAT THE PRICE OF THEIR GOODS DOES NOT EXCEED THE MANUFACTURER'S RECOMMENDED RETAIL PRICE. FOR ITEMS WHERE THE MANUFACTURER'S

RETAIL RECOMMENDED

IS PRICE IS NOT AVAILABLE, THE REQUIREMENT

THAT GOODS SHALL NOT BE SOLD AT A PRICE HIGHER THAN THAT NORMALLY CHARGED AT THE OPERATOR'S OTHER OUTLETS OR COMPARABLE SHOPS IN OTHER DISTRICTS IN HONG KONG,

/THE ENFORCEMENT