The Hong Kong Special Administrative Region government is considering introducing a mandatory seven-day cooling-off period and a 14-day refund window for prepaid contracts with beauty salons and gyms to enhance consumer protection.

The government’s proposed amendment to the Trade Descriptions Ordinance (TDO) also includes capping the maximum contract duration at two years and requiring all contracts to take effect within three months after being signed.

The government also suggests incorporating the offence of “wrongly accepting payment” under TDO to Schedule 1 of the Organized and Serious Crimes Ordinance, an upgrade that would grant the Hong Kong Customs and Excise Department greater probe and enforcement powers.

A two-month public consultation on the proposed amendment was launched on June 29.

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In a statement, a government spokesperson said the prevalence of the pre-payment consumption mode in the beauty and fitness industries has caused problems from time to time, and the sudden closure of some chain gym and beauty groups had resulted in financial losses for many consumers.

In relevant complaints, consumers often signed long-term contracts involving substantial pre-payments after being subjected to high-pressure sales tactics, the spokesperson added.

Winsome Au Wai-sum, a deputy secretary for Commerce and Economic Development, revealed in a recent radio program that between 2020 and 2025, over half of complaints regarding improper consumption arose from the beauty and gym sectors, and about 90 percent of such complaints related to high-pressure and misleading marketing ploys.

In a written reply to China Daily, the Consumer Council revealed an individual case that a couple purchased a 30-year fitness membership from a fitness center in 2023, with each charged HK$13,000 ($1,657). Subsequently, the pair, having been persuaded by staff, purchased a total of 668 courses within three months, with a total value of approximately HK$760,000.

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In 2024, due to the closure of this fitness center, they were unable to attend the remaining 450 courses and so lost unused services worth HK$540,000.

Clement Chan Kam-wing, chairman of the Consumer Council, voiced full support for the proposed regulations. “In the long run, this will help build a healthy and sustainable market environment, further enhance the consumer protection regime, and foster a safe and reassuring consumption environment for consumers,” Chan said.

In an emailed response to China Daily, the management team at local chain gym 24/7 Fitness said that the impact of the proposed regulations on their operations would be “minimal”, given that most of their members currently choose short-term or flexible monthly plans.

The company said that establishing a reasonable statutory cap on contract length would effectively raise the industry threshold, eliminate black sheep from the market, and foster a fairer, more transparent environment for consumers, particularly vulnerable groups like students and youngsters.

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Meanwhile, the company acknowledged that executing the cooling-off and refund mandates could pose some operational challenges, including confirming the exact start and end dates of a contract's cooling-off period, standardizing a method of calculating refunds after partial usage, and training front-line staff members to explain the new regulations to customers.

Lawmaker Bill Tang Ka-piu said the local beauty and fitness industries currently lack a mandatory statutory registration system, so lawbreakers could easily escape regulation simply by changing company names and rebranding. Tang urged the government to define the target sectors precisely.

In the Chinese mainland, consumers are granted a seven-day “no-reason refund” right for prepaid consumption. Regulations are even tighter in some places. In Shanghai, gym’s monthly and annual subscription fees are capped at 5,000 yuan ($736.47) and the length of relevant contracts cannot surpass two years. For lesson-based packages such as private training sessions, the total amount of prepaid money should be limited at 20,000 yuan and should not exceed 60 sessions.

Roys Zhang contributed to this story

Contact the writer at gangwen@chinadailyhk.com