Will tradesman collective wage agreement be exempted from the Hong Kong competition ordinance?

Tradesman Collective Wage Agreement (TCWA) has been used for construction tradesmen for many years. This would ensure the daily wage for qualified tradesmen will not fall below the agreed level. On 14^th December 2015, the Hong Kong first ever Competition Ordinance (HKCO) came into effect. Under the First Conduct Rule (Section 6 of the HKCO), an undertaking must not (a) make or give effect to an agreement; (b) engage in a concerted practice; or (c) as a member of an association of undertakings, make or give effect to a decision of the association, if the object or effect of the agreement, concerted practice or decision is to prevent, restrict or distort competition in Hong Kong. Moreover, Section 15 of HKCO allows exemption for agreements that fulfil certain criteria such as economic efficiency and public policy. This study finds that TCWA will likely violate the First Conduct Rule due to its price fixing effect. Moreover, TCWA can apply for block exemption under Section 15 of the HKCO on the ground of engendering economic benefits. Reference is also made to the first application for exemption under the HKCO to illustrate the key arguments.