### Competition Ordinance 《競爭條例》

15. Block exemption orders
(1) If the Commission is satisfied that a particular category of agreement is an excluded agreement, it may issue a block exemption order in respect of that category of agreement.
(2) The Commission may, either of its own volition or on application by an undertaking or an association of undertakings, issue a block exemption order.
(3) The Commission may, in a block exemption order—
(a) impose conditions or limitations subject to which the block exemption order is to have effect; and
(b) specify a date from which the order is to cease to have effect.
(4) The Commission must, in a block exemption order, specify a date, being a date not more than 5 years after the date of the order, upon which it will commence a review of the block exemption order.
(5) In this section—
excluded agreement (豁除協議) means an agreement that is excluded from the application of the first conduct rule by or as a result of section 1 (Agreements enhancing overall economic efficiency) of Schedule 1.

16. Procedures regarding block exemption orders
(1) Before issuing a block exemption order, the Commission must—
(a) in order to bring the proposed block exemption order to the attention of those the Commission considers likely to be affected by it, publish notice of the proposed block exemption order—
(i) through the Internet or a similar electronic network; and
(ii) in any other manner the Commission considers appropriate; and
(b) consider any representations about the proposed block exemption order that are made to the Commission.
(2) A notice under subsection (1) must specify the period within which representations may be made to the Commission about the proposed block exemption order.
(3) The period specified for the purpose of subsection (2) must be a period of at least 30 days beginning after the day on which the notice is first published.

17. Effect of block exemption order
(1) Subject to subsection (2), an agreement that falls within a category of agreement specified in a block exemption order is exempt from the application of the first conduct rule.
(2) The immunity provided by subsection (1) to undertakings making or giving effect to an agreement applies to an undertaking only if it complies with every condition and limitation subject to which the block exemption order has effect.

### Competition Ordinance 《競爭條例》

18. Non-compliance with condition or limitation
(1) If an undertaking fails or ceases to comply with a condition or limitation subject to which a block exemption order has effect, the block exemption order ceases to apply with respect to that undertaking with effect from the date on which the non-compliance begins.
(2) If an undertaking starts to comply or resumes compliance with the condition or limitation, the block exemption order applies to that undertaking with effect from the date on which the compliance begins or resumes.
(3) Action may be taken under this Ordinance against any undertaking relating to a contravention of the first conduct rule by that undertaking, that occurs during any period in which the block exemption order does not apply to it.

19. Review of block exemption order
(1) The Commission must commence a review of a block exemption order on the date specified in the order for the commencement of the review.
(2) Despite subsection (1), the Commission may review a block exemption order at any time if it considers it appropriate to do so.
(3) Without limiting the matters that may be considered in deciding, under subsection (2), whether or not to review a block exemption order, the Commission must consider the following—
(a) the desirability of maintaining a stable and predictable regulatory environment in relation to competition;
(b) any developments that have taken place in the economy of Hong Kong or in the economy of any place outside Hong Kong that affect the category of agreement that is the subject of the block exemption order; and
(c) whether any significant new information relating to the particular category of agreement has come to the knowledge of the Commission since the block exemption order was first issued.

### Competition Ordinance 《競爭條例》

20. Variation or revocation of block exemption order
(1) If the Commission considers that it is appropriate to do so, after reviewing a block exemption order, it may issue an order varying or revoking the block exemption order with effect from a date specified in the order.
(2) Before varying or revoking a block exemption order, the Commission must—
(a) in order to bring the proposed variation or revocation to the attention of those the Commission considers likely to be affected by it, publish notice of the proposed variation or revocation—
(i) through the Internet or a similar electronic network; and
(ii) in any other manner the Commission considers appropriate; and
(b) consider any representations about the proposed variation or revocation that are made to the Commission.
(3) A notice under subsection (2) must specify the period within which representations may be made to the Commission about the proposed variation or revocation.
(4) The period specified for the purpose of subsection (3) must be a period of at least 30 days beginning after the day on which the notice is first published.
(5) An order made under this section—
(a) must specify the date on which it is to have effect; and
(b) may contain any transitional and savings provisions the Commission considers necessary or expedient.

21. Abuse of market power
(1) An undertaking that has a substantial degree of market power in a market must not abuse that power by engaging in conduct that has as its object or effect the prevention, restriction or distortion of competition in Hong Kong.
(2) For the purpose of subsection (1), conduct may, in particular, constitute such an abuse if it involves—
(a) predatory behaviour towards competitors; or
(b) limiting production, markets or technical development to the prejudice of consumers.
(3) Without limiting the matters that may be taken into account in determining whether an undertaking has a substantial degree of market power in a market, the following matters may be taken into consideration in any such determination—
(a) the market share of the undertaking;
(b) the undertaking’s power to make pricing and other decisions;
(c) any barriers to entry to competitors into the relevant market; and
(d) any other relevant matters specified in the guidelines issued under section 35 for the purposes of this paragraph.
(4) The prohibition imposed by subsection (1) is referred to in this Ordinance as the second conduct rule.

22. Object

23. Territorial application of second conduct rule
The second conduct rule applies to conduct that has as its object or effect the prevention, restriction or distortion of competition in Hong Kong even if—
(a) the undertaking engaging in the conduct is outside Hong Kong; or
(b) the conduct is engaged in outside Hong Kong.